The share price of MYEG has been trending downwards following a head-and-shoulders formation in early January 2022,
plotting a sequence of lower lows subsequently before touching RM0.80 yesterday, which is near the 52-week support level.
Kenanga anticipates that MYEG’s share price may stage a technical rebound soon as the stock price is set to cross back above the lower Bollinger Band and bounce off from the lower range of its negative sloping channel while the stochastic indicator reverses from the oversold position.
A technical rebound could then pave the way for the shares to climb towards the resistance thresholds of RM0.925 (R1) and
RM0.99 (R2), translates to upside potentials of 16% and 24%, respectively. Kenanga’s stop loss price level is set at RM0.69 (or a 14% downside risk).
A SaaS group that offers solutions in the development and implementation of Electronic Government Services and has a presence in Malaysia, Philippines, Bangladesh, and Indonesia, MYEG has announced a net profit of RM316m (+17.8% YoY) in FY December 2021. The robust earnings momentum subsequently carried over to 1QFY22 when its bottomline soared to RM84.6m (+11% YoY).
Following this, a consensus is currently projecting the group would post net profit of RM349.1m for FY22 and RM381.6m for
FY23, translating to forward PERs of 17x and 15.7x, respectively
