Latest news with #NCTAllianceBerhad
Yahoo
16-04-2025
- Business
- Yahoo
Those who invested in NCT Alliance Berhad (KLSE:NCT) five years ago are up 85%
Stock pickers are generally looking for stocks that will outperform the broader market. And while active stock picking involves risks (and requires diversification) it can also provide excess returns. To wit, the NCT Alliance Berhad share price has climbed 85% in five years, easily topping the market return of 14% (ignoring dividends). With that in mind, it's worth seeing if the company's underlying fundamentals have been the driver of long term performance, or if there are some discrepancies. AI is about to change healthcare. These 20 stocks are working on everything from early diagnostics to drug discovery. The best part - they are all under $10bn in marketcap - there is still time to get in early. To paraphrase Benjamin Graham: Over the short term the market is a voting machine, but over the long term it's a weighing machine. By comparing earnings per share (EPS) and share price changes over time, we can get a feel for how investor attitudes to a company have morphed over time. During five years of share price growth, NCT Alliance Berhad achieved compound earnings per share (EPS) growth of 64% per year. The EPS growth is more impressive than the yearly share price gain of 13% over the same period. So one could conclude that the broader market has become more cautious towards the stock. The company's earnings per share (over time) is depicted in the image below (click to see the exact numbers). Dive deeper into NCT Alliance Berhad's key metrics by checking this interactive graph of NCT Alliance Berhad's earnings, revenue and cash flow. While the broader market lost about 2.5% in the twelve months, NCT Alliance Berhad shareholders did even worse, losing 13%. However, it could simply be that the share price has been impacted by broader market jitters. It might be worth keeping an eye on the fundamentals, in case there's a good opportunity. Longer term investors wouldn't be so upset, since they would have made 13%, each year, over five years. If the fundamental data continues to indicate long term sustainable growth, the current sell-off could be an opportunity worth considering. While it is well worth considering the different impacts that market conditions can have on the share price, there are other factors that are even more important. To that end, you should be aware of the 1 warning sign we've spotted with NCT Alliance Berhad . For those who like to find winning investments this free list of undervalued companies with recent insider purchasing, could be just the ticket. Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on Malaysian exchanges. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Sign in to access your portfolio
Yahoo
08-03-2025
- Business
- Yahoo
NCT Alliance Berhad's (KLSE:NCT) Soft Earnings Don't Show The Whole Picture
Soft earnings didn't appear to concern NCT Alliance Berhad's (KLSE:NCT) shareholders over the last week. We did some digging, and we believe the earnings are stronger than they seem. View our latest analysis for NCT Alliance Berhad As finance nerds would already know, the accrual ratio from cashflow is a key measure for assessing how well a company's free cash flow (FCF) matches its profit. The accrual ratio subtracts the FCF from the profit for a given period, and divides the result by the average operating assets of the company over that time. The ratio shows us how much a company's profit exceeds its FCF. As a result, a negative accrual ratio is a positive for the company, and a positive accrual ratio is a negative. While having an accrual ratio above zero is of little concern, we do think it's worth noting when a company has a relatively high accrual ratio. That's because some academic studies have suggested that high accruals ratios tend to lead to lower profit or less profit growth. Over the twelve months to December 2024, NCT Alliance Berhad recorded an accrual ratio of -0.18. That indicates that its free cash flow quite significantly exceeded its statutory profit. In fact, it had free cash flow of RM177m in the last year, which was a lot more than its statutory profit of RM36.2m. NCT Alliance Berhad's free cash flow improved over the last year, which is generally good to see. Unfortunately for shareholders, the company has also been issuing new shares, diluting their share of future earnings. Note: we always recommend investors check balance sheet strength. Click here to be taken to our balance sheet analysis of NCT Alliance Berhad. One essential aspect of assessing earnings quality is to look at how much a company is diluting shareholders. NCT Alliance Berhad expanded the number of shares on issue by 17% over the last year. That means its earnings are split among a greater number of shares. To celebrate net income while ignoring dilution is like rejoicing because you have a single slice of a larger pizza, but ignoring the fact that the pizza is now cut into many more slices. Check out NCT Alliance Berhad's historical EPS growth by clicking on this link. NCT Alliance Berhad has improved its profit over the last three years, with an annualized gain of 7.3% in that time. But on the other hand, earnings per share actually fell by 54% per year. Net profit actually dropped by 4.5% in the last year. Unfortunately for shareholders, though, the earnings per share result was even worse, declining 14%. So you can see that the dilution has had a bit of an impact on shareholders. In the long term, if NCT Alliance Berhad's earnings per share can increase, then the share price should too. But on the other hand, we'd be far less excited to learn profit (but not EPS) was improving. For the ordinary retail shareholder, EPS is a great measure to check your hypothetical "share" of the company's profit. In conclusion, NCT Alliance Berhad has a strong cashflow relative to earnings, which indicates good quality earnings, but the dilution means its earnings per share are dropping faster than its profit. Considering all the aforementioned, we'd venture that NCT Alliance Berhad's profit result is a pretty good guide to its true profitability, albeit a bit on the conservative side. If you'd like to know more about NCT Alliance Berhad as a business, it's important to be aware of any risks it's facing. For example, we've discovered 1 warning sign that you should run your eye over to get a better picture of NCT Alliance Berhad. In this article we've looked at a number of factors that can impair the utility of profit numbers, as a guide to a business. But there are plenty of other ways to inform your opinion of a company. For example, many people consider a high return on equity as an indication of favorable business economics, while others like to 'follow the money' and search out stocks that insiders are buying. So you may wish to see this free collection of companies boasting high return on equity, or this list of stocks with high insider ownership. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
