InvestIdeas

Top Glove plunges 70 cents on alleged $240 mil overstatement of Aspion acquisition
https://www.theedgesingapore.com/top-gl ... cquisition

Not all gloom and doom for Top Glove

Considering the alleged overstatement of assets and valuations, Top Glove may have paid double the value of Aspion, given the purchase price of RM1.37bil.

According to TA Securities Research, under the worst case scenario, Top Glove may have to impair the goodwill of possibly up to RM640.5mil, if the group loses the legal case.

“For best case scenario, where Top Glove wins the legal case, which will result in potentially RM714.9mil or more claims.

TA Securities Research has reiterated its “buy” call on Top Glove.

Source: The Star

https://www.thestar.com.my/business/bus ... C1ZesIp.99

not vested

Top Glove (TOPG MK)
4QFY18: Weaker-than-expected Earnings; Priced To Perfection

Top Glove’s 4QFY18 core earnings decelerated 9% qoq, mainly due to higher raw material, interest and tax costs.

Also, forward orders remained softer than 10 months ago.

We stay bearish on the stock as valuations are rich and risk-reward profile is unfavourable.

Within our coverage, Top Glove is the second priciest proxy to the sector.

Also, it is trading at more than +2SD its five-year forward PE.

Maintain SELL and target price of RM8.20.

Source: UOBKH

https://research.uobkayhian.com/content ... 76f1b75451

Malaysian authorities to take action against Top Glove over migrants' illegal overtime
https://www.theedgesingapore.com/malays ... l-overtime

Top Glove reports 4.4% higher 1Q earnings of $36 mil on strong global demand
https://www.theedgesingapore.com/top-gl ... bal-demand

not vested

RHB Research lowers target price for Top Glove to RM5.80

RHB Research Institute Sdn Bhd has maintained its “Buy” rating on Top Glove Corp Bhd at RM4.60 with a lower target price of RM5.80 (from RM6.75) after Top Glove announced on 4 Mar that it had listed exchangeable bonds (EBs) – principal amount: US$200 million – on Bursa Securities (under the exempt regime) and Singapore Exchange Trading.

RHB Research said its new target price values the stock at FY20F P/E of 23.9x, or 1.1SD above its mean valuation.

“We believe the premium valuation is justified due to the counter’s recent inclusion into FBM KLCI (effective 24 Dec 2018), as well as strong double-digit earnings growth for FY19F-20F.

“Key downside risks: industry overcapacity, currency movements, and volatile raw material prices,” it said.

Source: The Edge

https://www.theedgemarkets.com/article/ ... love-rm580

Top Glove posts 2.9% lower 2Q earnings of $35.3 mil despite strong revenue growth
https://www.theedgesingapore.com/top-gl ... nue-growth

not vested

Top Glove (TOPG MK)

Headwinds Likely To Drag Earnings In The Near Term

Sustained competition and spike in latex prices impacting latex gloves are likely to weigh on Top Glove’s near-term earnings.

Furthermore, industry expansion in Malaysia could be deferred should the demand-supply imbalance persist.

Positively, over the longer run, Top Glove will pursue a meaningful automation drive which is expected to reduce labour dependency.

Maintain HOLD. Target price: RM4.10. Entry price: RM3.70.

Source: UOBKH

https://research.uobkayhian.com/content ... 761b5979cc

Top Glove: Maintain HOLD but with a higher target price of RM4.70 (from RM4.10), pegged to 25x 2020F PE, a slight premium to the sector PE.

The alignment is fair as:
a) Top Glove has been making steady headway into the faster-growing nitrile glove space; and
b) despite the negative development at Aspion, the group is still touted as the no.1 surgical
glove player globally.

Entry price is RM4.40.

Source: UOBKH

not vested

Top Glove's net profit slides 36.5% to RM74.67m

KUALA LUMPUR: Top Glove Corp Bhd's net profit fell 36.5% year-on-year (y-o-y) to RM74.67mil in the third quarter ended May 31, 2019, amid rising natural rubber latex prices and strong competition.

This came despite sales revenue growth of 8.1% to RM1.19bil on the back of a 9% increase in sales volume.

The board of directors declared an interim dvidend of 3.5 sen per share, payable on July 16, 2019.

According to the statement, raw material prices were mixed in 3Q with natural rubber latex price rising 22% to RM4.42 per kg and hitting a peak of RM5.105 on April 9, 2019.

The average nitrile latex price decreased 3.1% to US$1.05 per kg.

As a result of the rising cost, Top Glove has increased the average selling prices of its products, the impact of which will be reflected in Q4 due to a time lag in the cost pass-through mechanism.

Source: The Star

https://www.thestar.com.my/business/bus ... TuckxlB.99