– IJM Corporation (IJM MK; RM4.54, SELL) – Unload on strength.
– Gamuda (GAM MK; RM2.70, BUY) – A rebound should take place soon.
– Top Glove Corporation (TOPG MK; RM9.19, SELL) – Chart looks toppish.
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IJM Corporation (IJM MK; RM4.54) – SELL
FY10P/E: 19.2x, P/BV: 0.9x
• The recent rise lifted IJM towards its resistance channel but we think it is likely to take a breather soon. Sellers near its key SMAs at around RM4.63-RM4.68 would likely keep the bulls at bay.
• As its 30-day SMA is now below the 50-day SMA, we believe it is time to take some profits off the table. Our strategy here is to unload on strength. Unless the candles can swing back above RM4.74, probability is favouring the bears.
• MACD remains in the red while RSI is turning flattish. Support is seen at RM4.35-RM4.30, followed by RM4.14 and RM3.98 next.
IJM Corporation Berhad is an investment holding company that provides construction services. The company, through its subsidiaries, operates in property development, provides quarrying services, manufactures and sells premix products, cultivates oil palm, and provides education services.
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Gamuda (GAM MK; RM2.70) – BUY
FY10P/E: 16.3x, P/BV: 1.7x
• Earlier selldown was steep but we believe there is a window to make quick buck. As long as prices stay above its recent low of RM2.61, we believe a based-building trend is in the making. Thereafter, a rebound should take place.
• Although MACD is still in the red, momentum is slowly picking up. Also, RSI has ceased to fall further, suggesting that buyers are slowly coming back. First resistance is seen at RM2.80-RM2.83, followed by RM3.02 next.
• Despite our bullishness, always place a stop at RM2.61 in case this is merely a dead cat bounce.
Gamuda Berhad is an investment holding and civil engineering construction company. Through its subsidiaries, it provides earthwork construction, manufactures and supplies road surfacing materials, and operates quarry and road laying projects. Gamuda also has operation in hiring and rental of plant and machinery, develops properties, and manufactures and sells paper.
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Top Glove Corporation (TOPG MK; RM9.19) – SELL
FY10P/E: 14.8x, P/BV: 3.3x
• Top Glove’s uptrend is still intact but we think a correction is imminent. Prices have been gyrating near its trend line resistance over the past few days, suggesting that the bears are gaining a bit of traction here.
• MACD has staged a Dead Cross while its histogram bar also slipped into the red, which likely points to more downside ahead. The easing RSI is also supportive of our view that the stock looks toppish.
• Although prices could still move a tad higher, we think sustainability is a concern. Near-term gains are likely to be capped at RM9.33-RM9.42 while support is at RM8.73, RM8.35 and RM8.00.
Top Glove Corporation Bhd manufactures a wide range of latex gloves. The company's products include latex examination powdered, latex examination powderfree, nitrile examination gloves,soft nitrile examination gloves, vinyl examination gloves, surgical gloves, and other related products.
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