OCNCASH - OCEAN full of CASH~ such an elegant name... I still remember i first written about OCNCASH in 24 September 2015. OCNCASH is my first stock-pick for my blog. At that time, the price is around 0.345, after 1.5 years, the price is now 0.435, a 26% in 1.5 years, which is seemed a quite fair result. Along the way, i kept track of its result. You can take a look at my previous post below:
Now let's dig in straight at the Q4 2016.
1. Fundamental Analysis
 |
| Revenue and Net Profit in Malaysia Stockbiz[1] |
OCNCASH announced their Q4 2016 result. Both revenue and net profit shown positive improvement in qoq and yoy. Revenue increased +13% qoq and +32% yoy respectively while net profit increased +4% qoq and +75% yoy respectively. If you notice from the snapshot above, this Q4 2016 shown the highest revenue and net profit during the displayed 3 years[1]. For me, this is definitely a growth stock. For the whole year, FY2016's revenue improved +5%, while net profit increased +14% when compared with FY2015. All in all, FY 2016 is a good year for OCNCASH.
If you like my way of analysis and you haven't join me in my facebook, appreciate if you could like my FB page, https://www.facebook.com/gainvestor10sai/?fref=ts
Thank you^^
 |
| Revenue and Net Profit in Chart Form |
 |
| Geographical Analysis by Revenue |
If we compare FY 2015 and FY 2016, Malaysia's revenue had increased the most (14%), followed by Japan (9%) and next is Thailand (8%). Malaysia and Japan covered around 65% of the revenue. Similar to previous years, OCNCASH also proposed a dividend of 0.7sen.
2. Technical Analysis
 |
| OCNCASH Daily Chart |
As for technical chart, i still maintain my view. There is an inverted head and shoulder, and normally it is a reversal pattern. How high it can go? From the tip of the head to the neckline, that will the the estimated distance to go up, which there is another 25% to go. For an inverted head and shoulder breakout to really happen, the volume at the right shoulder is the most important. The volume must be more than the volume at the right head, in which at the moment, it is still not happening yet. Since the revenue and net profit is already new high, next i think the chart should be able to break the resistance of 0.48. Once broken, then sky is the limit. But it also depends on the current market and also the market consensus. But for me, i am confident that OCNCASH will be able to break it.
3. Projection Analysis
The current PE is for OCNCASH is 9.56, with the EPS of 0.0455. Lets assume if the PE is 10, hence the share price should be around 0.455, which coincide with my resistance drawn in the technical chart.
If PE = 10, Price = 0.455
If PE = 15, Price = 0.680
If PE = 20, Price = 0.910
Since OCNCASH is still a growth company, lets assume the EPS in 2017
EPS in 2014 = 0.0220
EPS in 2015 = 0.0391 (increased 77%)
EPS in 2016 = 0.0455 (increased 16%)
EPS in 2017, assume it increased by 10% = 0.050
By then, with the EPS of 0.050, the estimated PE:
If PE = 10. Price = 0.50
If PE = 15, Price = 0.75
If PE = 20. Price = 1.00
I am not so ambitious at the moment, but hope OCNCASH is able to break the resistance of 0.455 and next target is to break 0.50.
Main Board Transfer Soon?
Another thing that interest me is OCNCASH is already able to transfer to Main Market. Why do i say so?
 |
| Revenue and Net Profit By Year |
The criteria from ACE Market to switch to MAIN Market is:
a) Uninterrupted profit after tax (“PAT”) of 3 - 5 full financial years (“FY”), with aggregate of at least RM20 million; and
b) PAT of at least RM6 million for the most recent full FY
By looking at the criterias, OCNCASH is already eligible, in fact, if i am not mistaken in 2015, i think OCNCASH is already eligible to transfer to Main Board. Now after a year, they even prove the business growth and i hope to see whether the management wants to transfer to Main Market, the ambition of the management towards future and is there any increment of fund houses through their Annual Report, which will be released before April.
If they really want to transfer to Main Market, it will be a super good news, as what i had shared in my SALUTE post about INARI and ELSOFT.
Summary:
OCNCASH continues to surprise me and hopefully will continue to have OCEAN full of CASH mindset:
- The revenue and net profit for Q4 is all time high, same goes to the full financial year. FY2016 is also all time high.
- Not a net cash company yet.
- Malaysia and Japan revenue had increased a lot due to hygiene and insulation section. As mentioned in the Annual Report 2014, hygiene section will record double digit growth. Seems that this promise is realized and hope to maintain it in the next coming years.
- In Technical Analysis, it formed an inverted Head and Shoulder, with the neckline at 0.425, support at 0.375, potential resistances are 0.455 and 0.48.
- With the Projection PE of 10, the target price should be around 0.455, which is aligned with our technical analysis's resistance.
- But if looking at longer term, if the company continue to grow, we target a 10% in EPS and PE of 15, the long term target price should be around 0.75.
- Currently, the company is eligible to transfer to Main Market, however there are still no pledge from the management whether to transfer or not.
- So in the coming Annual Report 2016, we should monitor a few things: Transfer to Main market, ambition and vision of the management towards the future and the numbers of fund houses.
If you like my way of analysis and you haven't join me in my facebook, appreciate if you could like my FB page, https://www.facebook.com/gainvestor10sai/?fref=ts
Thank you^^
Let's Ride the Wind and Gainvest
Gainvestor 10sai
24 February 2017
7.50am
Sources:
[1]: http://www.malaysiastock.biz/Corporate-Infomation.aspx?securityCode=0049
[2]: http://www.bursamalaysia.com/market/listed-companies/company-announcements/5344853
[2]: http://www.bursamalaysia.com/market/listed-companies/company-announcements/5344853
No comments:
Post a Comment