Hot Stock Ecoworld shares trending downwards, analysts urge 'buy on weakness'

by **Cals** Thu 14 Aug 2014, 01:24

Hot Stock Ecoworld shares trending downwards, analysts urge 'buy on weakness'

Business & Markets 2014

Written by Jonathan Gan of theedgemalaysia.com

Wednesday, 13 August 2014 17:06

KUALA LUMPUR (Aug 13): Ecoworld Development Bhd share price has been trending downwards for the past three weeks on short-term profit taking.

Shares of the property developer were among Bursa's top losers today, shedding 9 sen or 2% to trade at RM4.89 a share.

The company's share price has seen a decline of 7% since July 30th from RM5.25 to RM4.89 yesterday.

An analyst familiar with the stock told theedgemalaysia.com:“The company’s recent decline in stock price could be due to short term profit taking activities as many institutional investors are still looking at the stock.”

He encouraged investors to seize the opportunity to buy on weakness.

Technical analyst Khoh Wei Keen of Kenanga Research also advocated a similar strategy, saying: "The stock is nearing an oversold level but we foresee that the long term interest for the stock remains largely intact.

"We think investors should take this opportunity to buy on weakness,” said Khoh.

Alliance Research Bhd in its recent initiation note of Ecoworld Development Bhd placed a target price of RM6 per share on the company.

“We arrive at our TP of RM6.00, based on a 20% discount to our revalued net asset valuation methodology (pre-share split). On ex-all basis, we value ECW at RM2.00 (excluding 7-yr warrant dilution).

“We expect ECW’s earnings to grow substantially to RM77million in FY15 from RM24million in FY13, thanks to the unprecedented property sales boosted by the management team’s undisputed brand name,” said Quah He Wei, property analyst at Alliance Research.