JCY (5161) : Stocks With Momentum: JCY International
JCY International Bhd
With the ringgit’s recent depreciation, investors are looking at companies or sectors with export exposure, as they will gain from the weak ringgit in terms of margins or export competitiveness.
One such company that has recently attracted investors’ interest is JCY International, which manufactures hard disk drive (HDD) components with factories in Johor, Thailand, Penang and China. Its shares have seen a 48.6% increase in just one month — from 46.1 sen on 16 December 2014 to 68.5 sen yesterday.
JCY has long fallen out of favour with investors, following a series of disappointing results that showed the challenges faced by hard disk drive (HDD) component manufacturers. These include competition for HDD from solid state drives, as well as squeezed margins due to cost-down pressure by their multinational customers and the previously strong ringgit.
With 78% of its sales denominated in foreign currencies, further ringgit weakness may be positive for the company, as is already evident in its latest results.
Revenue for JCY has ranged from RM 1.6 billion to RM2.2 billion over the last 4 years. However, margins have see-sawed year on year, ranging from a loss in FY2013 to a high of 19.06% before ending at 6.4% in FYSept2014. The company attributes its turnaround to better demand and the ringgit’s weakness.
JCY has also managed to increase its net cash holdings tremendously in just 2 years, starting from about RM600,000 in 2012 to RM 178.3 mil in FY2014. Dividend yield for FY 2014 was 6.79% with a historical payout once every 2 years.
The stock is trading at a trailing 12-month P/E of 11.42 times and 1.21 times book. The Edge Research rates JCY a Fundamental score of 1.8 out of 3 and a Valuation score of 1.2 out of 3.
jcy_16Jan15_theedgemarkets
This article first appeared in The Edge Financial Daily, on January 16, 2015.
This article first appeared in The Edge Financial Daily, on January 16, 2015.
http://www.theedgemarkets.com
JCY International Bhd
With the ringgit’s recent depreciation, investors are looking at companies or sectors with export exposure, as they will gain from the weak ringgit in terms of margins or export competitiveness.
One such company that has recently attracted investors’ interest is JCY International, which manufactures hard disk drive (HDD) components with factories in Johor, Thailand, Penang and China. Its shares have seen a 48.6% increase in just one month — from 46.1 sen on 16 December 2014 to 68.5 sen yesterday.
JCY has long fallen out of favour with investors, following a series of disappointing results that showed the challenges faced by hard disk drive (HDD) component manufacturers. These include competition for HDD from solid state drives, as well as squeezed margins due to cost-down pressure by their multinational customers and the previously strong ringgit.
With 78% of its sales denominated in foreign currencies, further ringgit weakness may be positive for the company, as is already evident in its latest results.
Revenue for JCY has ranged from RM 1.6 billion to RM2.2 billion over the last 4 years. However, margins have see-sawed year on year, ranging from a loss in FY2013 to a high of 19.06% before ending at 6.4% in FYSept2014. The company attributes its turnaround to better demand and the ringgit’s weakness.
JCY has also managed to increase its net cash holdings tremendously in just 2 years, starting from about RM600,000 in 2012 to RM 178.3 mil in FY2014. Dividend yield for FY 2014 was 6.79% with a historical payout once every 2 years.
The stock is trading at a trailing 12-month P/E of 11.42 times and 1.21 times book. The Edge Research rates JCY a Fundamental score of 1.8 out of 3 and a Valuation score of 1.2 out of 3.
jcy_16Jan15_theedgemarkets
This article first appeared in The Edge Financial Daily, on January 16, 2015.
This article first appeared in The Edge Financial Daily, on January 16, 2015.
http://www.theedgemarkets.com
