Smart money has been pouring into Vivocom Intl Holdings Berhad (stock code: 0069) with expectations for the share price to ascend even further.
Yesterday (18 August), Vivocom closed at a ten-week high of 31 sen with more than 90 million shares traded, a 40 percent rise from its 22 sen levels in late June.
In a commentary based on Vivocom’s share price, RHB Research described it as such: “VIVOCOM has been trading above its upward sloping 20-Day Moving Average which is a good sign.”
“In addition, the price just broke the resistance of 0.295 reinforcing the bullishness in the recent price movement. This breakout was accompanied by a higher than average traded volume which shows the enthusiasm of the traders to push the price higher and past this resistance hence giving a higher probability of a successful breakout,” added RHB Research.
Averaging up and making a killing from Vivocom!
Says an industry observer: “Investors who’d bought the share at the 22 and 23 sen levels would have made a killing. However, I know of quite a number of investors who are not selling and betting on the company’s extremely bright long term prospects.”
(Earlier this year, Business Today had highlighted about how Vivocom is a “Construction Giant in the making”.)
“Some investors are actually averaging up to further maximize profit as such a sustainable run is previously unseen of in the stock market,” he further said.
This probably explains why Vivocom’s shareholding base had increased from 12,250 investors (as at February 2016) to 16,358 (as at end-July).
As we reported earlier this month, fresh funds had entered the stock in recent weeks and increased the company’s shareholders base.
Based on its annualised 1st quarter results, it is worthwhile noting that Vivocom is currently only trading at less than 10 times price-earnings multiple whilst its peers with similar market capitalisation are currently trading at price-earnings multiples ranging from 14 times to 17 times.
Even at current levels, Vivocom shares represent great value for bargain hunters especially in view of the Bonus Issue reward for shareholders, and research houses’ “fair value” of the stock of between 63 sen (MIDF) and 78 sen (CIMB Research). In other words, expectations are for Vivocom’s share price to double or more in time to come.
Vivocom continues bagging one lucrative contract after another
Vivocom’s “rising star” status had not gone unnoticed by the market.
CIMB Research has an “Add” rating on Vivocom – with a re-rating catalyst being strong Q2 results. As mentioned earlier, CIMB has a target price of 78 sen for Vivocom, an upgrade from its original 72 sen target price.
MIDF has also upgraded Vivocom’s target price to 63 sen (from 59 sen previously).
Given the numerous BUY calls, the general consensus is that at present levels, Vivocom shares represent great value for bargain hunters.
Meanwhile on its order book front, Vivocom continues to bag one lucrative contract after another.
In an announcement to Bursa Malaysia this evening, the company said that it had received a Letter of Award from Green Ventures Development Sdn Bhd for the appointment as Turnkey Contractor for the construction of 2 block of 18 storeys of 1 Malaysia Housing Projects for Civil Servants (PPA1M) on Lot 151768 , Wilayah Chepor Batu 10, Mukim Hulu Kinta, Perak.
The provisional contract amount is RM100,000,000 (Ringgit Malaysia One hundred million) and further swells Vivocom’s burgeoning orderbook to an incrediblel RM2 billion.
As often said by Vivocom executive director to investors: “We pride ourselves on our pursuit of excellence in our core businesses, and we intend to be wealth creators on a sustainable basis for all our loyal shareholders.”
Editor’s Note: This is not a recommendation to buy or sell stocks. Please consult your stockbroker and/or financial advisor before making any investment decision.