– AMMB Holdings (AMM MK; RM4.99, BUY) – A rebound may take place soon.
– Kump Hartanah Selangor (KHSB MK; RM0.44, SELL) – Cluster of resistances ahead.
– Kencana Petroleum (KEPB MK; RM2.27, SELL) – 50-day SMA support is weak.
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AMMB Holdings (AMM MK; RM4.99) – BUY
FY10P/E: 15.3x, P/BV: 1.7x
• Since our Sell rating on 23rd Nov, prices have drifted lower towards the support channel. We are now turning bullish again as its technical landscape is looking appealing from a trading perspective. AMMB is a good trading stock as its prices swing between a trading zone.
• Although MACD is still falling, it is dwindling at a slower pace. Coupled with the improving RSI, we see a rebound taking place soon. There is a mild resistance at RM5.12, followed by RM5.32 next.
• As long as the candles stay above its 50-day SMA, we think the uptrend is intact. Traders however must keep stop tight at either RM4.90 (support trend line) or RM4.70 (50-day SMA) depending on the risk tolerance.
AMMB Holdings is an investment holding company. Through its subsidiaries, it provides merchant and commercial banking, retail financing, stock and futures broking, and investment advisory. AMMB also underwrites general insurance, provides asset and unit trust management, and nominees services.
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Kumpulan Hartanah Selangor (KHSB MK; RM0.44) – SELL
FY10P/E: N/A, P/BV: 0.5x
• The stock is still gyrating in a declining channel. Despite numerous attempts, the candlestick bars failed to inch past its key SMAs. This suggests that momentum is still weak. There is a cluster of resistances near RM0.47-RM0.48 zone.
• Even if RM0.48 is taken out, it needs to pierce above the RM0.525 downtrend channel to reverse the trend. We think such expectation is a tall order but if it comes true, then a stronger bull is in the picture, likely pushing the stock towards RM0.54 next.
• The current recovery mode could last for a few more days. However, we think any rebound is a good chance to lock in profits as this could be a dead cat bounce. Support is seen at RM0.42 and RM0.405. Sell into strength.
Kumpulan Hartanah Selangor Berhad is a property development and investment company. Through its subsidiaries, the company provides hotel management services, operates club, and invests in property. Kumpulan Hartanah Selangor Berha also has operation in project management.
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Kencana Petroleum (KEPB MK; RM2.27) – SELL
FY10P/E: 13.4x, P/BV: 4.8x
• The stock is hanging by a thread now. Although late buying support prevented it from easing below the support trend line yesterday, we see room for a deeper correction. If the 50-day SMA gives way, next downside targets are RM2.14 and RM2.01.
• Although we do not discount the possibility of stronger upswings ahead, we believe such gains are likely to be short-lived. Therefore, we continue to advocate a sell-into-strength strategy. Sellers are likely to surface at RM2.37 and RM2.47 resistances.
• MACD is falling fast while its histogram bars have also turned negative. This is a reflection of weak underlying. Coupled with a falling RSI, it appears that the bears are gaining a bit of strength here. .
Kencana Petroleum Bhd provides integrated engineering and fabrication of production facilities for the oil and gas industry. The company provides engineering and fabrication of modules, process skid systems, EPCC Services, supporting services, and specialized fabrication.
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