FIGURE 1: RHB BANK BERHAD LAST
5 YEARS SHARE PRICE TREND
**analysis
based on 2018 annual report.
1.
GENERAL INTRO: This counter core business is on various
banking services. RHB Bank is one of the major banks in Malaysia. RHB Bank's
last five years earning per share fluctuated from 43.6 to 79.7sen. At current
share price, P/E ratio is at relatively low level (9.72). Total annual dividend
payout was 20.5sen per share, at current share price dividend yield is around
4.4%. Overall, shares investment in RHB Bank are less attractive compared to
Maybank, CIMB Bank and Public Bank.
2.
NOTABLE POINTS:
a. RHB
Bank is not one of the top performing banks in Malaysia, return on equity
around 10% only, cost-to-income ratio, relatively high at 49.3%. Management
have room for improvement to match the performance of other major banks in
Malaysia. Dividend payout ratio is at 35.7%, also on average lower than other banks,
which have payout ratio of more than 40%.
3.
IS THIS COUNTER A STRONG GROWTH STOCK?
a. REVENUE
RANGE (million): ~3447 million in 2018 annual report, this is a high revenue
company.
b. SHARE
PRICE: from 2013-2019, share price steady at around RM5
c. EARNING
PER SHARE (EPS): earning per share in last 5 years were fluctuating between 43.6
to 79.7 sen per share.
d. FUTURE
POTENTIAL/PROSPECTS: very dependable and reliable counter, share price expected
to be stable.
e. CAPITAL
EXPENDITURE (CAPEX): spending on purchase of new fixed assets is RM 113
million, around 0.05% of total assets.
4.
IS THIS A STRONG DIVIDEND STOCK?
a. DIVIDEND
YIELD: in 2018 report, RHB Bank declared a total dividend payout of 20.5 sen
per share, amounts to dividend yield of 4.40 % based on current share price.
b. CONSISTENCY:
consistent dividend payout, last five years (2014-2018) dividends declared range
from 6 to 20.5 sen per share.
5.
OTHER INDICATORS:
a. CASH
FLOW: cash flow is positive, around RM 12552 million, equivalent to RM 3.13 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 (40.62%), Amanah
Saham Bumiputera (4.87%), Kumpulan Wang Persaraan (3.24%), Permodalan Nasional
Berhad (0.51%), Aabar Investments (14.75%), OSK Holdings (5.6%) and few
insurance companies and investment funds.
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