May 12, 2011

PETRA - CIMB Research has Buy on Petra Perdana at 99.5 sen

Stock Name: PETRA
Company Name: PETRA PERDANA BHD
Research House: CIMB

KUALA LUMPUR: ''CIMB Equities Research has a Buy on Petra Perdana at 99.5 sen, at which it is trading at a price-to-book value of 0.9 times and FY12 price-to-earnings of 14.4 times.

It said on Thursday, May 12 Petra has been consolidating in a wedge pattern for the past few weeks. This consolidation phase appears to be at its tail end.

'As long as prices can hold steady above its recent swing low of RM0.925, we think stronger rebound is imminent,' it said.

CIMB Research said the technical landscape is improving. MACD histogram bars are falling at a slower pace while RSI has also turned upward. There is a minor hurdle at the 30-day SMA (now at RM1.02) while further upswing should push prices towards RM1.06 and RM1.15 next.

'Our strategy here is to buy on weakness. Prices must not fall below the 92.5 sen low to keep the bulls intact. Be quick to cut losses if prices violate the wedge support,' it said.

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