not vested
On June 3 above, Koon was pricing in Forward PE 20 and Forward PE 26.
It's interesting to note that he has now (June 22) reduced his Forward PE to 20 and 15 now.
For Commodity products, shouldn't the PE be reduced further to 10 or even 7, especially when they have controlled Covid19 (possibly in 2021) and when there's over-capacity in the industry?
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June 22, 2020
Supermax: my target price
by Koon Yew Yin
I refer to the above report, total issued shares is 1,300 million.
1st quarter revenue Rm 447 million, NP 71 million, EPS 5.42 sen.
Since the company has its own sale outlets in US and other countries, it can easily increase its selling price for gloves. Any price increase is pure profit.
It is quite safe to assume it can increase gradually 100% minus 30% tax = 70% by the end of the 4th quarter. That is 70% of Rm 447 million = Rm 313 million divided by 3 = Rm 104 million or 8 sen EPS in each quarter.
2nd quarter EPS 5.42 sen + 8 sen = 13.4 sen
3rd quarter EPS 13.4 sen + 8 sen = 21.4 sen
4th quarter EPS 21.4 sen + 8 sen = 29.4 sen
Total 70 sen
Assuming P/E 20 target price Rm 14
Assuming P/E 15 target price Rm 10.5
(At P/E 10, the target price will be RM 7; At PE 7.5, the Target Price will be RM 5.25)
https://klse.i3investor.com/blogs/koonyewyinblog/