FIGURE 1: AMMB HOLDINGS BERHAD
LAST 5 YEARS SHARE PRICE TREND
**analysis
based on 2019 annual report.
1.
GENERAL INTRO: This counter core business is on various
banking services. Am Bank is one of the major banks in Malaysia. Am Bank's last
five years earning per share decreased overall from 63.8 to 50sen. At current
share price, P/E ratio is at relatively low level (8.09). Total annual dividend
payout was 20sen per share, at current share price dividend yield is around
4.81%, which is lower than fixed deposit rate. Am Bank did not perform well
compared to other banks in Malaysia, return on equity around 8.5% only,
cost-to-income ratio, relatively high at more than 50%. Management should
improve efficiency more to match the performance of other major banks in
Malaysia. Dividend payout ratio is at around 40%, which is similar to other
banks. Overall, shares investment in Am Bank are less attractive compared to
Maybank, CIMB Bank and Public Bank.
2.
NOTABLE POINTS:
a. in
2019 report, highlights include cost to income ratio 54.3%, return on equity
8.8%, dividend payout ratio 40%
3.
IS THIS COUNTER A STRONG GROWTH STOCK?
a. REVENUE
RANGE (million): ~3922 million in 2019 annual report, this is a high revenue
company.
b. SHARE
PRICE: from 2013-2019, share price on decreasing trend from RM8.00 to around RM4.20.
c. EARNING
PER SHARE (EPS): earning per share in last 5 years were decreasing from 63.8 to
50.0 sen per share.
d. FUTURE
POTENTIAL/PROSPECTS: quite dependable and reliable counter, share price expected
to be stable.
e. CAPITAL
EXPENDITURE (CAPEX): spending on purchase of new fixed assets is RM 31 million,
around 0.02% of total assets.
4.
IS THIS A STRONG DIVIDEND STOCK?
a. DIVIDEND
YIELD: in 2019 report, Am Bank Bank declared a total dividend payout of 20 sen
per share, amounts to dividend yield of 4.81 % based on current share price.
b. CONSISTENCY:
consistent dividend payout, last five years (2015-2019) dividends declared range
from 15 to 27.3 sen per share.
5.
OTHER INDICATORS:
a. CASH
FLOW: cash flow is positive, around RM 7269 million, equivalent to RM 2.41 per
share
b.
SUPPORT BY INSTITUTIONAL INVESTORS: this counter
is well supported by institutional investors, there are 30 institutional
investors at top 30 major shareholders list, including EPF (6.92%), Amanah
Saham Bumiputera (2.64%), ANZ Funds Pty Ltd (23.78%), SOCSO (0.63%) and few
insurance companies and investment funds.
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