FIGURE 1: UNITED MALACCA BERHAD
LAST 5 YEARS SHARE PRICE TREND
**analysis
based on 2019 annual report.
1.
GENERAL INTRO: UNITED MALACCA is one of the main
oil palm plantations in Malaysia.
2.
NOTABLE POINTS:
a. In
2019 report, reported losses of -18.61 sen per share in current financial year
due to low crude palm oil prices and new adoption of the Malaysian Financial
Reporting Standards.
b. The
Group has three mills with a mill total processing capacity of 80 MT/hour
3.
IS THIS COUNTER A STRONG GROWTH STOCK?
a. REVENUE
RANGE (million): ~207.3 million in 2019 annual report, this is a low revenue
company.
b. SHARE
PRICE: from 2015-2019, share price fluctuated from around RM5.00 to RM7.00
c. EARNING
PER SHARE (EPS): earning per share in last 5 years fluctuated from -18.6 to 40.4sen
d. FUTURE
POTENTIAL/PROSPECTS: share price may drop further if company continue to make
losses.
e. CAPITAL
EXPENDITURE (CAPEX): spending on purchase of new fixed assets is RM 90.5
million, around 4% of total assets.
4.
IS THIS A STRONG DIVIDEND STOCK?
a. DIVIDEND
YIELD: in 2019 financial year, UNITED MALACCA declared a dividend payout of 8 sen
per share to shareholders, despite facing losses. The dividend yield amounts to
1.5%.
b. CONSISTENCY:
consistent dividend payout, last five years (2015-2019) dividends declared range
between 8 to 23 sen per share, whereby the dividend yield ranged from 1.5 to
3.7%.
c. DIVIDEND
PAYOUT RATIO: in 2019 financial year, UNITED MALACCA paid out -42.99% of its
earnings to investors in the form of dividend.
5.
IS THE MANAGEMENT PERFORMANCE GOOD?
a. RETURN
ON EQUITY (ROE): in 2019 financial year, UNITED MALACCA achieved a low return
of shareholders’ equity, at 3%. The ROE in last five years ranged from 1.6 to
4.8%.
b. COST-TO-INCOME
RATIO: cost-to-income ratio is negative at about -517%, due to losses in the
financial year.
6.
OTHER INDICATORS:
a. CASH
FLOW: cash flow is positive, around RM 46.8 million, equivalent to RM 0.22 per
share
b.
SUPPORT BY INSTITUTIONAL INVESTORS: this counter
is not well supported by institutional investors, there are only 20 institutional
investors at top 30 major shareholders list, including EPF (0.82%), OCBC BANK
LTD (14.11%), GREAT EASTERN LIFE ASSURANCE (13.44%), PROSPER PALM OIL MILL SDN
BHD (10.72%), insurance companies and investment funds.
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