Phillip Securities Research in a Feb 21 research report says: "Ziwo issued profit guidance that financial results for 4Q11 and FY2011 will be substantially lower compared to 2010. This is due to slower sales of products, lower gross profit margins and increases in operating expenses.
"The company also mentioned the potential impairment of trade receivables. We are projecting FY2011 revenue and net profit to fall 7.5% and 39.2% respectively. In 3Q11, receivables spike up 27% despite sales dropping 15% sequentially. Share price had run up from its trough along with the small cap rally before the profit warning announcement which we think is unjustified.
"On a P/B basis, stock appears cheap at 0.5x with zero debt on its balance sheet and high cash balance of approximately 12 cent per share. Unchanged target price of 9.5 cents. MAINTAIN SELL."
"The company also mentioned the potential impairment of trade receivables. We are projecting FY2011 revenue and net profit to fall 7.5% and 39.2% respectively. In 3Q11, receivables spike up 27% despite sales dropping 15% sequentially. Share price had run up from its trough along with the small cap rally before the profit warning announcement which we think is unjustified.
"On a P/B basis, stock appears cheap at 0.5x with zero debt on its balance sheet and high cash balance of approximately 12 cent per share. Unchanged target price of 9.5 cents. MAINTAIN SELL."
No comments:
Post a Comment