Stock With Momentum: Menang Corp

This article first appeared in The Edge Financial Daily, on July 17, 2018.
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Menang Corp (M) Bhd (-ve)

TRADING of shares in Menang Corp (M) Bhd (fundamental: 0.45/3; valuation: 1.1/3) triggered our momentum algorithm yesterday for the first time this year.

The stock closed up 2.04% or one sen at 50 sen, with 1.46 million shares done versus the counter’s 200-day average of 185,203 shares.

The company is involved in construction activities, including maintenance of facilities and infrastructure. For the third financial quarter ended March 31, 2018 (3QFY18), net profit jumped threefold to RM2.73 million from RM570,000 a year ago, thanks to lower expenses and a reversal of deferred tax.

Quarterly revenue, however, fell 17% to RM23.1 million compared with RM27.88 million in 3QFY17, due to the completion of private finance initiative projects. For the cumulative nine months, net profit dropped 45% to RM5.35 million from RM9.7 million a year ago, while revenue dropped 16% to RM69.39 million from RM82.48 million.

Menang Corp is currently trading at 0.78 times its net book value.