MORNING CALL 18 May
2012
FLOWS;
BUYS: Benalec, Genting, PChem
SELLS: KNM, Maybank, WCT
Technical Stock Alert;
QL (RM3.13) - Breaking below RM3.11 neckline could see
stock fall to RM2.80 short term target. MACD has cut down. Any
significant break below 200MA of MR3.05 could form a bearish signal. Valuation
remains rich despite its defensive qualities as Share price is trading at
18.7xFY12PE and 16xFY13. 5-year historical PE average is only 15x. Possible
downside risk to earnings estimates given the recent pullback in CPO where 20%
of revenue is from this segment.
GENTING MSIA (RM3.60) - RSI crossing into the low 20's
with a wide divergence in MACD. A further sell down especially to its initial
support of RM3.30 levels should be seen as a strong buying opportunity due to the
relatively recession proof nature of the gaming business and its added
attraction from exposure to the US. Upside bounce back capped at RM3.70/80 levels.
