GKENT (3204) - Technical and Fundamental Analysis

Technical Analysis


- After 14th General Election on 9 May 2018, GKENT shares price slashed by 63% from RM3.845 to RM1.415 within three working days.

- Then, it entered a long term consolidation phrase for around 1.5 years (Upper Line: RM1.315; Bottom Line: RM0.910)

- Recently, GKENT break-out the Triangle Pattern on Nov 29, 2019, and It tried to re-bounce back to RM0.985.

- It failed to sustain above RM0.985 and continue the downtrend after the Q32019 financial announcement.

- RSI becomes null status which indicates high selling pressure on GKENT shares.

- As long as shares prices unable to trade above MA20, we still consider GKENT shares price still in a downtrend.

- Resistance (2): RM0.985

- Resistance (1): RM0.910

- Support (1): RM0.835

- Support (2): RM0.735

Fundament Analysis


- GKENT corporate value at RM1.186 and estimated shares price with the lowest PE + last 4Q EPS is RM0.693

- If we are value investor, we should put on hold to invest in GKENT counter with consideration as below:-

(1) Record lower low in Cash & Cash equivalent in past Q4 (Y2019: 250.96M)

(2) Negative cash flow from operating activities

(3) Negative growth rate in Revenue + COGS + EBIT

(4) Deteriorate in Days' sales in inventory in the past 4 years (2.6 mths)

(5) Increase in Account Receivable Turnover ratio in the past 4 years (3.9)

- However, GKENT management shows a high commitment and great confidence in their business model with increasing total equity steadily in the past 4 years and initiate shares buyback campaign since June 20, 2018, to support shares price.


©2019 by Dividend Investor.

Email: hongweigiet222@gmail.com

Location: Malaysia

Capital Investment