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Yahoo
05-05-2025
- Business
- Yahoo
Solid Earnings May Not Tell The Whole Story For Kretam Holdings Berhad (KLSE:KRETAM)
The recent earnings posted by Kretam Holdings Berhad (KLSE:KRETAM) were solid, but the stock didn't move as much as we expected. We believe that shareholders have noticed some concerning factors beyond the statutory profit numbers. This technology could replace computers: discover the 20 stocks are working to make quantum computing a reality. Importantly, our data indicates that Kretam Holdings Berhad's profit received a boost of RM80m in unusual items, over the last year. While it's always nice to have higher profit, a large contribution from unusual items sometimes dampens our enthusiasm. We ran the numbers on most publicly listed companies worldwide, and it's very common for unusual items to be once-off in nature. Which is hardly surprising, given the name. Kretam Holdings Berhad had a rather significant contribution from unusual items relative to its profit to December 2024. All else being equal, this would likely have the effect of making the statutory profit a poor guide to underlying earnings power. Note: we always recommend investors check balance sheet strength. Click here to be taken to our balance sheet analysis of Kretam Holdings Berhad. As we discussed above, we think the significant positive unusual item makes Kretam Holdings Berhad's earnings a poor guide to its underlying profitability. As a result, we think it may well be the case that Kretam Holdings Berhad's underlying earnings power is lower than its statutory profit. Nonetheless, it's still worth noting that its earnings per share have grown at 15% over the last three years. At the end of the day, it's essential to consider more than just the factors above, if you want to understand the company properly. With this in mind, we wouldn't consider investing in a stock unless we had a thorough understanding of the risks. While conducting our analysis, we found that Kretam Holdings Berhad has 1 warning sign and it would be unwise to ignore it. This note has only looked at a single factor that sheds light on the nature of Kretam Holdings Berhad's profit. But there is always more to discover if you are capable of focussing your mind on minutiae. Some people consider a high return on equity to be a good sign of a quality business. 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.
Yahoo
21-04-2025
- Business
- Yahoo
Mobilia Holdings Berhad (KLSE:MOBILIA) Stock Has Shown Weakness Lately But Financials Look Strong: Should Prospective Shareholders Make The Leap?
It is hard to get excited after looking at Mobilia Holdings Berhad's (KLSE:MOBILIA) recent performance, when its stock has declined 13% over the past three months. However, stock prices are usually driven by a company's financial performance over the long term, which in this case looks quite promising. Specifically, we decided to study Mobilia Holdings Berhad's ROE in this article. Return on equity or ROE is a key measure used to assess how efficiently a company's management is utilizing the company's capital. Put another way, it reveals the company's success at turning shareholder investments into profits. Trump has pledged to "unleash" American oil and gas and these 15 US stocks have developments that are poised to benefit. The formula for ROE is: Return on Equity = Net Profit (from continuing operations) ÷ Shareholders' Equity So, based on the above formula, the ROE for Mobilia Holdings Berhad is: 17% = RM13m ÷ RM80m (Based on the trailing twelve months to December 2024). The 'return' is the profit over the last twelve months. That means that for every MYR1 worth of shareholders' equity, the company generated MYR0.17 in profit. See our latest analysis for Mobilia Holdings Berhad So far, we've learned that ROE is a measure of a company's profitability. Depending on how much of these profits the company reinvests or "retains", and how effectively it does so, we are then able to assess a company's earnings growth potential. Assuming all else is equal, companies that have both a higher return on equity and higher profit retention are usually the ones that have a higher growth rate when compared to companies that don't have the same features. To start with, Mobilia Holdings Berhad's ROE looks acceptable. Especially when compared to the industry average of 5.0% the company's ROE looks pretty impressive. This probably laid the ground for Mobilia Holdings Berhad's moderate 7.0% net income growth seen over the past five years. As a next step, we compared Mobilia Holdings Berhad's net income growth with the industry and found that the company has a similar growth figure when compared with the industry average growth rate of 7.3% in the same period. Earnings growth is a huge factor in stock valuation. What investors need to determine next is if the expected earnings growth, or the lack of it, is already built into the share price. By doing so, they will have an idea if the stock is headed into clear blue waters or if swampy waters await. Has the market priced in the future outlook for MOBILIA? You can find out in our latest intrinsic value infographic research report Mobilia Holdings Berhad has a three-year median payout ratio of 26%, which implies that it retains the remaining 74% of its profits. This suggests that its dividend is well covered, and given the decent growth seen by the company, it looks like management is reinvesting its earnings efficiently. Moreover, Mobilia Holdings Berhad is determined to keep sharing its profits with shareholders which we infer from its long history of three years of paying a dividend. Overall, we are quite pleased with Mobilia Holdings Berhad's performance. Specifically, we like that the company is reinvesting a huge chunk of its profits at a high rate of return. This of course has caused the company to see substantial growth in its earnings. If the company continues to grow its earnings the way it has, that could have a positive impact on its share price given how earnings per share influence long-term share prices. Not to forget, share price outcomes are also dependent on the potential risks a company may face. So it is important for investors to be aware of the risks involved in the business. To know the 2 risks we have identified for Mobilia Holdings Berhad visit our risks dashboard for free. 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
04-04-2025
- Business
- Yahoo
MGB Berhad (KLSE:MGB) Is Experiencing Growth In Returns On Capital
If we want to find a potential multi-bagger, often there are underlying trends that can provide clues. Firstly, we'd want to identify a growing return on capital employed (ROCE) and then alongside that, an ever-increasing base of capital employed. If you see this, it typically means it's a company with a great business model and plenty of profitable reinvestment opportunities. Speaking of which, we noticed some great changes in MGB Berhad's (KLSE:MGB) returns on capital, so let's have a look. We've found 21 US stocks that are forecast to pay a dividend yield of over 6% next year. See the full list for free. If you haven't worked with ROCE before, it measures the 'return' (pre-tax profit) a company generates from capital employed in its business. The formula for this calculation on MGB Berhad is: Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets - Current Liabilities) 0.12 = RM80m ÷ (RM1.1b - RM449m) (Based on the trailing twelve months to December 2024). So, MGB Berhad has an ROCE of 12%. In absolute terms, that's a pretty normal return, and it's somewhat close to the Construction industry average of 10.0%. Check out our latest analysis for MGB Berhad Above you can see how the current ROCE for MGB Berhad compares to its prior returns on capital, but there's only so much you can tell from the past. If you'd like, you can check out the forecasts from the analysts covering MGB Berhad for free. The trends we've noticed at MGB Berhad are quite reassuring. Over the last five years, returns on capital employed have risen substantially to 12%. The company is effectively making more money per dollar of capital used, and it's worth noting that the amount of capital has increased too, by 30%. The increasing returns on a growing amount of capital is common amongst multi-baggers and that's why we're impressed. All in all, it's terrific to see that MGB Berhad is reaping the rewards from prior investments and is growing its capital base. Considering the stock has delivered 16% to its stockholders over the last five years, it may be fair to think that investors aren't fully aware of the promising trends yet. So exploring more about this stock could uncover a good opportunity, if the valuation and other metrics stack up. MGB Berhad does have some risks though, and we've spotted 2 warning signs for MGB Berhad that you might be interested in. For those who like to invest in solid companies, check out this free list of companies with solid balance sheets and high returns on equity. 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.
