P&L Updates – Top picks are mostly still strong

Sunway – EPS 10.59 cents – Hold with target continue above RM 4.00
Tropicana – EPS 6.43 cents – Hold with target above RM 2.00
Bonia – EPS 1.14 cents – Hold with another quarter in focus
YTL – EPS 3.27 cents – Hold with fair value above RM 1.80
Kawan – EPS 4.47 cents – Hold with target above RM 3.00
MNRB – EPS 19.80 cents – Buy with target above RM 8.00
ALAQAR – EPS 2.16 cents – Hold with fair value at RM 1.40
Allianze – EPS 37.07 cents – Hold with target at RM 15.00
Cheetah – EPS 0.39 cents – Sell on strength

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Concept and rumored stocks are worth to invest?

It is not the first time. We just do not understand why there are many cases of concept stocks or rumored stocks being chase up without fundamental good reasons. Lately PDZ which has a NTA of RM 0.10 and uninteresting earnings results from last few quarters. If even a new share holder taking over and inject assets into the stock. Will it benefit the current investors with a trading price of RM 0.400?

Another case like ECOworld with many raising the target to RM 6.00 with NTA at RM 1.2 and also uninteresting results. Again even with land injection and new explosive developments that can benefits the company. Will it benefit if you buy in now at RM 5.20? Do you think the major share holder will be generous enough to inject free land and do not capitalize on its effort to revise the company with profit?

We are not sure but is difficult to convince us buying into these stocks. Rumoring the son of this or that taking over…. We advise better stick to money on the table counter like MBSB. As merger is likely on the table with book ratio of 1.75 times. Even if the merger call off with the current PE is a straight bet to me.

KLSE and global markets are expected to range bound next week

We foresee a lackluster week for KLSE except a surprise from Selangor crisis for snap poll. The world markets staged a strong recovery after week before sold out. We do not see the momentum is going to continue very much this week. We expect most markets will be range bound and revenue will reduce further. Very much a result oriented market.

Most announced quarterly results not encouraging

In the last two weeks, there are numbers of companies announced their results. However, the results are not encouraging with mostly reported lower revenue and profit. Some widened its losses and significant reduced in revenue. If base on a much tougher environment in 2nd half due to several known issues. We are holding our optimism for KLSE for a strong run in 2015 as GST is approaching in next year.

Several structural issues in our homeland like politics, systems and resources are gradually making more impacts. We will start to review our position to reduce our holding of equities between 5 to 10% of our total portfolio. We will either hold cash or buying neighbor listed S-REITS for the time being.

We disposed all of our AAX as its losses widened

We have disposed all our AAX at RM 0.780. We decided to cut loss as we think it is a long term trend that long haul flight will continue to pressure by immense competition. Worst, AAX is struggling to opening new route that may potentially have a quick fix to them. So we decided to dispose all holdings.

We expect market to continue trending upward close at 1870 as target

We believe the market will continue trending upwards to positive closing by end of the week.   1870 is an immediate resistance but the momentum will be slower than last week.  Especially if Selangor saga is going to be an end.  Everything is stay clear for expected more buying activities ahead.  We like Cypark at below RM 2.70.  We are disposing OSK gradually and switched to our recommended portfolio.

KLCI is expected to rebound and stay positive for the week

We believe the sell off is over done for our local market. Russian counter sanctions to the West. US commanded air strikes and expected to prolong. PAS is staying with PR even has a different support view on MB of Selangor. We expect the market to rebound but will face resistance at 1260 – 1270. However, if nothing worsen from the current situation. We expect KLCI to have a positive week. In mind term 2014, we maintain our long position.

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