Evergreen Fiberboard Bhd
Evergreen (Fundamental: 0.75/3, Valuation: 1.2/3) was picked by The Edge Market’s Stocks with Momentum three times since December 31, 2014. Its share price has risen a whopping 46.3% over this period while volume has also far exceeded its 200 trading days average.
Evergreen is one of the world’s largest producers and exporters of wood-based medium density fibreboard (MDF) and particleboard, with annual production of over 1.3 million cubic metres. It has manufacturing plants in Malaysia, Thailand and Indonesia.
With export — mainly to the Middle East and Southeast Asia — accounting for over 70% of sales, the company is likely seen as a beneficiary of the strengthening US dollar.
It bears to note though that the industry is very competitive. Despite having a strong management team, Evergreen made a net loss of RM43 million in 2013 and cumulative losses of RM14 million in 9M2014. It has net debt totaling RM252 million.
This article first appeared in The Edge Financial Daily, on January 27, 2015.