Shares of EcoWorld have gained nearly 70% so far this year, tracking broad gains in the property sector. The stock has also benefited from news flow related to data centre and industrial properties.
KUALA LUMPUR (Sept 20): Shares of Eco World Development Group Bhd (KL:ECOWLD) rose on Friday to their highest in seven weeks after the property developer reported better-than-expected third-quarter results.
EcoWorld climbed three sen or 1.7% to RM1.77, its highest since Aug 1, 2024. The stock was trading at RM1.76 at 9.06am, giving the company a market capitalisation of RM5.19 billion. Trading volume totalled 594,400 shares so far.
Core net profit for the nine months ended July 31, 2024 accounted for 82% of the consensus full-year estimates, and the company had also surpassed its own full-year sales target, prompting analysts to raise their earnings forecasts.
UOB Kay Hian, which raised its net profit forecast by up to 12% for FY2024-FY2026, estimates that sales will likely hit RM3.8 billion by the financial year end in October 2024.
The research house also raised its target price to RM2.10 from RM2.05 and kept its ‘buy’ call on the stock, citing the company’s improving balance sheet and return on equity, dividend yields of 4%-5% as well as its “leading position in the property sector”.
Shares of EcoWorld have gained nearly 70% so far this year, tracking broad gains in the property sector. The stock has also benefited from news flow related to data centre and industrial properties.
A majority of six out of nine research houses have ‘buy’ calls on the stock and two have ‘hold’ ratings while one recommends ‘sell’. The consensus 12-month target price is RM1.88, according to Bloomberg, implying a potential return of 7% from its last price.
EcoWorld is now expected to rake in a RM289 million net income for FY2024, according to estimates from seven analysts on Bloomberg.
CGS International, which maintained its ‘add’ call on EcoWorld, likes the stock for the robust earnings outlook, potential monetisation of land bank, and compelling dividend yields of 3.5%-3.7% for FY2024-FY2026.
The company also reported that it has hit the full-year sales target of RM3.5 billion within the first 10 months of FY2024. EcoWorld, however, did not raise the target, according to analysts who attended the company’s post-earnings briefing.
All in all, cumulative net profit rose 18.32% to RM220.12 million from RM186.03 million over the same nine months in the previous year while revenue grew 17.17% to RM1.62 billion from RM1.38 billion.
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Source: EdgeProp.my
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