Stock With Momentum: Merge Energy

This article first appeared in The Edge Financial Daily, on June 29, 2017.
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Merge Energy Bhd (+ve)

SHARES in Merge Energy Bhd (fundamental: 1.15/3, valuation: 1.7/3), which triggered our momentum algorithm yesterday for the first time this year, closed 1.27% or half a sen lower at 39 sen yesterday. The counter saw 698,400 shares traded, compared with its 200-day average volume of 73,000 shares.

Merge Energy posted a net profit of RM1.05 million in the fourth financial quarter ended March 31, 2017 (4QFY17), while quarterly revenue came in at RM16.4 million. For the full financial year ended March 31, 2017 (FY17), its net profit and revenue stood at RM1.69 million and RM87.5 million, respectively.

Merge Energy noted, however, that progress billings in FY17 were lower as most of the group’s ongoing projects were close to being completed. Looking forward, Merge Energy said it is confident of securing and undertaking more jobs available for bidding in 2017 and 2018.

At the current share price, Merge Energy is trading at 0.43 times its book value.