KUALA LUMPUR (April 2): GD Expess Carrier Bhd shares advanced in early trade today after Hong Leong IB Research said it believes that express delivery and logistic services provider GD Expesss Carrier Bhd (GDEX) should be fairly valued at RM1.80 given its strong growth potentials.
At 9.12am, GDX rose 1.82% or three sen to RM1.68 with 66,000 shares traded.
In a note today, the research house said GDEX (Fundamental: 3.00; Valuation: 0.70) has been enjoying strong earnings growth leveraging on volume growth.
It said GDEX registered FY14 pre-tax profit at RM24.3 million (6.75x of RM3.6m in FY09) and net profit of RM23.4 million (11.4x of RM2.1m of FY09).
“Management expects continued double digit growth for the next 5 years, driven by stable volume growth from conventional clients and surging volume growth from e-commerce. We have projected FY15-17 earnings growth of +23.6-38.6%.
“We believe GDEX should be fairly valued at RM1.80 based on FY17 P/E of 27.5x, given the strong growth potentials of its business model with further upside from regional expansion,” it said.
(Note: The Edge Research's fundamental score reflects a company’s profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations. Go to www.theedgemarkets.com for details on a company’s financial dashboard.)