Latest news with #RM1.37
Yahoo
24-03-2025
- Business
- Yahoo
Is It Too Late To Consider Buying Southern Cable Group Berhad (KLSE:SCGBHD)?
While Southern Cable Group Berhad (KLSE:SCGBHD) might not have the largest market cap around , it received a lot of attention from a substantial price movement on the KLSE over the last few months, increasing to RM1.37 at one point, and dropping to the lows of RM1.01. Some share price movements can give investors a better opportunity to enter into the stock, and potentially buy at a lower price. A question to answer is whether Southern Cable Group Berhad's current trading price of RM1.10 reflective of the actual value of the small-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let's take a look at Southern Cable Group Berhad's outlook and value based on the most recent financial data to see if there are any catalysts for a price change. This technology could replace computers: discover the 20 stocks are working to make quantum computing a reality. Good news, investors! Southern Cable Group Berhad is still a bargain right now according to our price multiple model, which compares the company's price-to-earnings ratio to the industry average. We've used the price-to-earnings ratio in this instance because there's not enough visibility to forecast its cash flows. The stock's ratio of 14.05x is currently well-below the industry average of 18.4x, meaning that it is trading at a cheaper price relative to its peers. Another thing to keep in mind is that Southern Cable Group Berhad's share price is quite stable relative to the rest of the market, as indicated by its low beta. This means that if you believe the current share price should move towards its industry peers, a low beta could suggest it is not likely to reach that level anytime soon, and once it's there, it may be hard to fall back down into an attractive buying range again. See our latest analysis for Southern Cable Group Berhad Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. Although value investors would argue that it's the intrinsic value relative to the price that matter the most, a more compelling investment thesis would be high growth potential at a cheap price. With profit expected to grow by 72% over the next couple of years, the future seems bright for Southern Cable Group Berhad. It looks like higher cash flow is on the cards for the stock, which should feed into a higher share valuation. Are you a shareholder? Since SCGBHD is currently below the industry PE ratio, it may be a great time to accumulate more of your holdings in the stock. With an optimistic outlook on the horizon, it seems like this growth has not yet been fully factored into the share price. However, there are also other factors such as capital structure to consider, which could explain the current price multiple. Are you a potential investor? If you've been keeping an eye on SCGBHD for a while, now might be the time to make a leap. Its buoyant future profit outlook isn't fully reflected in the current share price yet, which means it's not too late to buy SCGBHD. But before you make any investment decisions, consider other factors such as the strength of its balance sheet, in order to make a well-informed assessment. If you'd like to know more about Southern Cable Group Berhad as a business, it's important to be aware of any risks it's facing. For example, Southern Cable Group Berhad has 3 warning signs (and 1 which makes us a bit uncomfortable) we think you should know about. If you are no longer interested in Southern Cable Group Berhad, you can use our free platform to see our list of over 50 other stocks with a high growth potential. 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.
Yahoo
24-02-2025
- Business
- Yahoo
Estimating The Intrinsic Value Of Matrix Concepts Holdings Berhad (KLSE:MATRIX)
The projected fair value for Matrix Concepts Holdings Berhad is RM1.37 based on Dividend Discount Model With RM1.49 share price, Matrix Concepts Holdings Berhad appears to be trading close to its estimated fair value Our fair value estimate is 41% lower than Matrix Concepts Holdings Berhad's analyst price target of RM2.34 Today we will run through one way of estimating the intrinsic value of Matrix Concepts Holdings Berhad (KLSE:MATRIX) by projecting its future cash flows and then discounting them to today's value. One way to achieve this is by employing the Discounted Cash Flow (DCF) model. Don't get put off by the jargon, the math behind it is actually quite straightforward. We generally believe that a company's value is the present value of all of the cash it will generate in the future. However, a DCF is just one valuation metric among many, and it is not without flaws. Anyone interested in learning a bit more about intrinsic value should have a read of the Simply Wall St analysis model. Check out our latest analysis for Matrix Concepts Holdings Berhad As Matrix Concepts Holdings Berhad operates in the real estate sector, we need to calculate the intrinsic value slightly differently. Instead of using free cash flows, which are hard to estimate and often not reported by analysts in this industry, dividends per share (DPS) payments are used. This often underestimates the value of a stock, but it can still be good as a comparison to competitors. We use the Gordon Growth Model, which assumes dividend will grow into perpetuity at a rate that can be sustained. The dividend is expected to grow at an annual growth rate equal to the 5-year average of the 10-year government bond yield of 3.6%. We then discount this figure to today's value at a cost of equity of 12%. Compared to the current share price of RM1.5, the company appears around fair value at the time of writing. The assumptions in any calculation have a big impact on the valuation, so it is better to view this as a rough estimate, not precise down to the last cent. Value Per Share = Expected Dividend Per Share / (Discount Rate - Perpetual Growth Rate) = RM0.1 / (12% – 3.6%) = RM1.4 We would point out that the most important inputs to a discounted cash flow are the discount rate and of course the actual cash flows. You don't have to agree with these inputs, I recommend redoing the calculations yourself and playing with them. The DCF also does not consider the possible cyclicality of an industry, or a company's future capital requirements, so it does not give a full picture of a company's potential performance. Given that we are looking at Matrix Concepts Holdings Berhad as potential shareholders, the cost of equity is used as the discount rate, rather than the cost of capital (or weighted average cost of capital, WACC) which accounts for debt. In this calculation we've used 12%, which is based on a levered beta of 1.339. Beta is a measure of a stock's volatility, compared to the market as a whole. We get our beta from the industry average beta of globally comparable companies, with an imposed limit between 0.8 and 2.0, which is a reasonable range for a stable business. Strength Earnings growth over the past year exceeded its 5-year average. Debt is well covered by earnings. Dividend is in the top 25% of dividend payers in the market. Weakness Earnings growth over the past year underperformed the Real Estate industry. Opportunity Annual revenue is forecast to grow faster than the Malaysian market. Good value based on P/E ratio compared to estimated Fair P/E ratio. Threat Debt is not well covered by operating cash flow. Paying a dividend but company has no free cash flows. Annual earnings are forecast to grow slower than the Malaysian market. Although the valuation of a company is important, it ideally won't be the sole piece of analysis you scrutinize for a company. It's not possible to obtain a foolproof valuation with a DCF model. Instead the best use for a DCF model is to test certain assumptions and theories to see if they would lead to the company being undervalued or overvalued. If a company grows at a different rate, or if its cost of equity or risk free rate changes sharply, the output can look very different. For Matrix Concepts Holdings Berhad, there are three essential elements you should consider: Risks: For instance, we've identified 2 warning signs for Matrix Concepts Holdings Berhad (1 is significant) you should be aware of. Future Earnings: How does MATRIX's growth rate compare to its peers and the wider market? Dig deeper into the analyst consensus number for the upcoming years by interacting with our free analyst growth expectation chart. Other Solid Businesses: Low debt, high returns on equity and good past performance are fundamental to a strong business. Why not explore our interactive list of stocks with solid business fundamentals to see if there are other companies you may not have considered! PS. The Simply Wall St app conducts a discounted cash flow valuation for every stock on the KLSE every day. If you want to find the calculation for other stocks just search here. 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.
