BACKGROUND...
Mitra(9571)is a KLCI counter in my portfolio, this post is simply serve as my record keeping for stock analysis. The report was written back in March 2014 and haven't been updated since then.
FUNDAMENTAL ANALYSIS...
MITRA, with existing stock price at RM0.59 P/E is trading lower @ 7.67X than industry average of 14.35X, however net profit margin is at the low side of ~8% if compared to industry average of 13%. In addition to that, NTA is significantly lower than the trading price indicates the stock is undervalued.
With current ratio of ~2.1X Mitra is healthy financially, however Cash: Short Term Loan ratio of 0.12x shows that the company will be running into cash problem shall the macro economy deteriorates. Anyway, it survive 2009 crash with same cash position … Magic
Judging by the recent contract secured worth RM430 million from Malaysian government, and potential revenue of RM1.6 billion from launching two properties projects in prime area of Wangsa Maju and Puchong, expect the net income for Mitra will boom exponentially from the next 2 years.
TECHNICAL ANALYSIS...
Bullish trend confirmed, and with floating shares of close to 40% the price swing is going to be wild.
COMPETITIVE ANALYSIS...
Comparing to companies in same field and with similar market cap, P/E ratio for Mitra is lower than industry average. Net profit margin is in mid-range
INSIDER TRADING...
Guess who is accumulating ?? The average price of his current transaction is ~RM0.53 ...
PROSPECT ANALYSIS...
Some mathematics works here …...
- Construction, Properties & Health Care should continue to contribute EPS 7.43 cents.
- New contract worth RM427.9M should contribute 1.5 cents to EPS, factor in down payment, progressive payment of 30% in 2014 and profit margin of 8%.
- Assume no new contract secured through year 2016 (worst case scenario)
Simulations result shown in table below ...
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