The government is likely to announce ceiling prices for chicken and egg supplies ahead of the Eid al-Fitr celebration tomorrow while it awaits discussions between the two ministries on Wednesday.
Personally I think PWF is one of the most potential Poultry Stock to be benefited from the Budget 2024. 1) Its has completed its extension plan, so no more capital expenditure. 2) Capacity has increase a lot compare to previous year, so its revenue will gradually increase till RM200mil per quarter. 3) It is quite cost efficiency compare to other Poultry counter, so with no more ceiling price control by government, I expected it profit margin will be higher. 4) The boss is very generous, keep on distribute cash dividend and bonus issue. Unlike other counter (i.e LAYXXXX), the boss very stingy and none of the minority shareholder can gain benefit from him.
Conclusion, I believe this counter will very soon back to RM0.80++ level (the price before it bonus issue) as remove of chicken & egg ceiling price is a very good news for this counter. This is long term good news, it is not a one shot good news for hit & run, it is a permanent long term good news as government is start removing subsidy and control, let the market price determine by the supply & demand.
For the past few years (2020-2023), many player has stop / slowdown the expansion plan, so I believe the entire market has a gap between supply & demand, and this gap will take around 1-2 years to close down. Meaning, chicken and egg price will be increase within this two years, before market is oversupply and bring the price down again.
Can’t really see much insider or deeper explanation on the business from QR, very standard & on the face explanation.
Explanation below also very suspicious: Pre-tax profit increased by RM6.84 million to RM15.31 million compared to RM8.47 million recorded in the immediate preceding quarter due to subsidies from government.
Company also never illustrates the impact of the upliftment of ceiling price of poultry, just repeat the fact in the statement where we already knew from the news.
I see, I thought you got any special insider news. I believe all proper investor (except newbie) should have taken note on Bonus issue, they won't simply buy just based on EPS without checking is there any bonus issue or share split recently.
As a fundamental investor, what we are more concern is about the business performance itself, or anything that can affect the business performance (i.e. Government policy, Nature disaster (i.e. Flood), raw material price, management direction ...etc)
I know it's very painful to hold this highly-volatile stock, but I still believe that we are in the 2015-2016 phase of the sector-wide (agriculture) bull run.
PWF Corporation Berhad Multiple green flags for Financial Analysis: - YoY net income +239% - YoY EPS +210% - QoQ net income 227% - ROE 14%
As for Technical Analysis: - 10MA has already crossed the 50MA - ATR% Multiple from MA is at 0.5, which means we're at the bottom and the price can be pushed up further (7.0 and above is peak) - Average volume 1-2M shares traded past 5-7 days, so if it's >2M, keep your eyes peeled for positive price action
Based on this, there is a good probability that there is an upside in price for this counter. Manage your risks, don't chew more than you can swallow.
This book is the result of the author's many years of experience and observation throughout his 26 years in the stockbroking industry. It was written for general public to learn to invest based on facts and not on fantasies or hearsay....
risktoreward
990 posts
Posted by risktoreward > 2021-07-23 12:33 | Report Abuse
enter @ 0.605 - 0.615