Stock With Momentum: REDtone International

This article first appeared in The Edge Financial Daily, on July 12, 2019.
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REDtone International Bhd (+ve)
TRADING of shares in REDtone International Bhd (fundamental: 2.2/3, valuation: 0.9/3) triggered our momentum algorithm yesterday for the sixth time this year. The counter closed up 2.5 sen or 6.67% at 40 sen, after 14.76 million shares were traded, higher than its 200-day average volume of 1.18 million shares.


The group is an Multimedia Super Corridor-status company that provides data and broadband services to corporate, small and medium enterprises and government sectors. It also helps manage and build WiFi networks.


Its net profit for the fourth quarter ended April 30, 2019 climbed 53% to RM4.8 million, from RM3.13 million in the previous year, thanks to higher contributions from its managed telecommunication network service segment. Revenue jumped 132% to RM73.38 million from RM31.61 million. For its full financial year 2019, net profit was 2.6 times higher at RM15.36 million versus RM5.97 million a year ago, as revenue grew 52% to RM178.93 million from RM118.08 million.

As of yesterday, REDtone was trading at 1.94 times its net book value.