PublicInvest maintains outperform on Magni-Tech, TP at RM6.45

KUALA LUMPUR: Magni-Tech Industries Bhd continues to be a compelling investment owing to its net cash position of RM232.1mil, attractive dividend yield and earnings growth, says PublicInvest research.

The research house maintained its outperform call on the group with an unchanged target price of RM6.45.

In its recent 3QFY19 results announcement, the group declared a dividend of eight sen per share, bringing total dividend year-to-date to 18 sen per share.

FOr the recent quarter, the group’s revenue fell 1.4% although core net profit rose 7.6% year-on-year (y-o-y) due mainly to foreign exchange gain and lower operating expenses.

The garment segment continued to be the largest contributor to Magni-Tech, contributing 90.3% to its total revenue.

Over a nine-month period, core net profit came in line with PublicInvest’s expectations at 74.9% of its full-year forecast.

The research house added that Magni-Tech has recovered strongly from its recent 12-month low of RM3.86.

Moving forward, the group is expected to receive contribution from its new plant, which commenced operations in mid-March this year, said PublicInvest.

Meanwhile, a second plant is currently under construction and expected to commence operations in mid-2019.

Source : TheStar