CIMB Securities has maintained its REDUCE call on Amway (Malaysia) Holdings Bhd with an unchanged target price of RM4.05, saying price adjustments have improved margins but ongoing consumer downtrading continues to weigh on the earnings outlook.
Amway posted a 335.8% year-on-year jump in 2QFY26 core net profit to RM6.2 million, while revenue edged up 1.9% as promotional sales of cellular health products and higher selling prices provided support. Gross profit margin expanded two percentage points to 21.5%.
CIMB said the stronger margin, combined with lower selling and administrative expenses and a lower effective tax rate, drove the sharp increase in quarterly profit. However, revenue for 1HFY26 declined 4.8% year-on-year as sales weakened across most product categories.
Core net profit for the first half rose 9% to RM16 million, which CIMB considered broadly in line with expectations. Amway also declared a five sen dividend for 2QFY26, bringing its first-half dividend to 10 sen, unchanged from a year earlier.
Looking ahead, CIMB expects earnings to strengthen in the second half, supported by new products including AmCell, targeted marketing initiatives and promotional opportunities from Amway Malaysia’s 50th anniversary celebrations.
However, the research house expects full-year core profit to decline 6.3% as consumers continue to prioritise essential spending over discretionary purchases. It said higher-priced categories such as home appliances and personal care remain particularly exposed to weaker demand.
CIMB retained its RM4.05 target price, noting Amway trades at 16.6 times CY26 earnings, above its five-year and 10-year averages.
As of 12.13 pm, the stock price gained 0.90% to RM4.50.
