Technology stocks has been hammered down since beginning of February. Nasdaq 100 Index had retreated by 6.90% for the past month and as for our local technology benchmark index of FBM Technology Index, had shown a retracement up to 3.97%.
Investors now might have one question in mind – does this spells game over for technology stocks?
In the longer term, the retracement was healthy as majority of the technology stocks had enjoyed a over-premium pricing of 60-70 times of PER. Now it is the time for retracement.
However, one company had remained resilient despite some of the big names such as D&O (7204), MI (5286) and PENTA (7160) had dropped more than 20% from its peak. And this company would be ARB Berhad (“ARBB”).
Despite the fear in the market, ARBB did not drop despite the high volume today. This might be caused by its solid fundamental and low-compared to peer comparison. Most do not aware that ARBB is trading at single digit PER of 4.16 times!
As you can see, ARBB’s profit and revenue are growing steadily recently. Since their ultimatum transformation of timber company to a ERP & IoT play, the stock price had rallied; but not to its fair value yet! Not to mention the company had such good fundamentals to support its pricing, unlike some technology companies who are solely base on sentiment.
Long story short, this is a new chapter and / or beginning of a new engine to kickstart ARBB to RM 1.00 in the near future.
Stay strong, and follow through the growth of this company!