Stock With Momentum: Techfast Holdings

This article first appeared in The Edge Financial Daily, on July 17, 2018.
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Techfast Holdings Bhd (+ve)

TRADING of shares in Techfast Holdings Bhd (fundamental: 2.8/3; valuation: 0.5/3) triggered our momentum algorithm yesterday for the first time this year.

The stock closed up 7.22% or 3.5 sen at 52 sen, with 6.16 million shares done versus the counter’s 200-day average of 1.59 million shares.

The company specialises in the manufacture and distribution of high-precision computer components, electronic hardware and telecom components.

For the first quarter ended March 31, 2018 (1QFY18), net profit dropped 29% to RM606,000 year-on-year from RM858,000, despite it recording higher sales which resulted in quarterly revenue increasing 28% to RM6.95 million from RM5.45 million in 1QFY17.

The group said the lower net profit was attributed partly to higher indirect material cost and higher depreciation charges affecting gross profit margins.

Techfast is currently trading at 4.95 times its net book value.