Stock With Momentum: Deleum Bhd

This article first appeared in The Edge Financial Daily, on May 15, 2018.
-A +A

Deleum Bhd (-ve)
Shares in Deleum Bhd (fundamental: 1.8/3; valuation: 2/3), which triggered our momentum algorithm yesterday for the second time this year, closed 5.26% or six sen higher at RM1.20.

It saw 1.22 million shares traded, about three times its 200-day average volume of 433,694 shares.

The company mainly provides specialised products and services, like gas turbine generators, and the supply and commissioning of power plants.

Deleum posted a 22% year-on-year (y-o-y) jump in annual net profit in the financial year ended Dec 31, 2017 (FY17) to RM32.28 million, due to lower impairment charges, restructuring costs, financing costs and a more favourable effective tax rate. But revenue fell 12% y-o-y to RM534.1 million from RM608.7 million amid challenging trading conditions in the power and machinery and oilfield services segments.

At its current share price, the stock is trading at 0.59 times its book value and has a market capitalisation of RM477.12 million.