Stock With Momentum: CCK Consolidated Holdings

This article first appeared in The Edge Financial Daily, on July 24, 2017.
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CCK Consolidated Holdings Bhd (-ve)
SHARES in poultry processing firm CCK Consolidated Holdings Bhd (fundamental: 1/3, valuation: 1.4/3) triggered our momentum last Friday.

The counter closed unchanged at 95.5 sen, with a market capitalisation of RM301.17 million. It recorded 8.33 million shares done, versus an average 1.25 million shares traded in the last 200 days. The stock is currently trading at 1.25 times its book value.

Shares in CCK hit their highest of RM1.05 in May on expectations that it may be posting a better set of results in the second quarter ended June 30, 2017 (2QFY17), which is yet to be announced.

For 1QFY17, its net profit grew 52% year-on-year to RM4.57 million from about RM3 million a year ago, as revenue grew 14% to RM142.36 million from RM124.46 million.

According to Hong Leong Investment Bank Bhd, “through its strategically located stores, CCK could fetch better margins as it complements its whole supply chain”.

In the note last Friday, the investment bank further noted that CCK has undemanding valuations and a healthy dividend policy.