Result Update
For QE310/4/2019, Redtone's net profit dropped 11% q-o-q but rose 53% y-o-y to RM4.8 million while revenue rose 62% q-o-q or 132% y-o-y to RM73 million. Revenue rose q-o-q mainly due to higher revenue from Managed Telecommunication Network Services ("MTNS") segment.
Table: Redtone's last 8 quarterly results
Graph: Redtone's last 33 quarterly results
Financial Position
As at 30/4/2019, Redtone's financial position is healthy with current ratio at 2.5 times and gearing ratio at 0.5 time.
Valuation
Redtone (closed at RM0.305 yesterday) is now trading at a trailing PE of 15 times (based on last 4 quarters' EPS of 2.01 sen). At this PE, Redtone is still deemed attractive for a turnaround stock with room for further growth.
Technical Outlook
Redtone is trying to stay above its long-term downtrend line, RR as well as its intermediate uptrend line, RR- both at RM0.29.
Chart 1: Redtone's weekly chart as at Jun 25, 2019 (Source: Malaysiastock.biz)
Chart 2: Redtone's daily chart as at Jun 25, 2019 (Source: Malaysiastock.biz)
Conclusion
Based on improved financial performance, healthy financial position and mildly bullish technical outlook, Redtone could be a good stock for long-term investment.
Note:
I hereby confirm that I do not have any direct interest in the security or securities mentioned in this post. However, I could have an indirect interest in the security or securities mentioned as some of my clients may have an interest in the acquisition or disposal of the aforementioned security or securities. As investor, you should fully research any security before making an investment decision.
http://nexttrade.blogspot.com/2019/06/redtone-revenue-and-pbt-continued-to.html
