Stock With Momentum: Velesto Energy

This article first appeared in The Edge Financial Daily, on March 7, 2019.
-A +A

Velesto Energy Bhd (-ve)
TRADING of shares in Velesto Energy Bhd (fundamental: 1.25/3, valuation: 0.9/3) also triggered our momentum algorithm yesterday for the first time this year.

The counter closed up one sen or 3.85% at 27 sen for a market capitalisation of RM2.22 billion, after 80.18 million shares were traded, higher than its 200-day average volume of 17.82 million shares.

Velesto participates in upstream activities of the oil and gas industry by providing drilling and oilfield services. It was formerly known as UMW Oil & Gas Corp Bhd.

Last month, Velesto bagged a US$38 million (RM155 million) contract extension to provide high-pressure high-temperature jack-up drilling rig and services for North Malay Basin, Malaysia, from Hess Exploration and Production Malaysia BV.

Velesto said it will assign one of its rigs, NAGA 8, for the 18-month contract extension, which also comes with an option for further extension. As at yesterday, its shares were trading at 0.79 times its net book value.