There is an English saying “Exception makes the rule”. If there is no exception, there is no rule.
My share selection golden rule is that the company must show profit growth is the last 1 or 2 quarters to make sure that the company can make more profit in the current year than last year before I decide to buy the share.
Although Gamuda does not show profit growth in the last quarter, why its share price is going up higher?
It is going up higher and higher because all the financial analysts who cover this stock have a target price of around Rm 5.70 because they anticipate Gamuda’s good profit growth from all its existing projects and from the new projects which it expects to receive.
TA Securities research says that Gamuda will start its earning cycle in 2017.
Readers should see my previous article “Gamuda WE is a safe good bet”.
The advantages of buying Gamuda WE:
Instead of buying one Gamuda mother share at Rm 4.90, you can buy 4 Gamuda WE at the current price of Rm 1.22. The price of the warrant will move up in tandem with its mother share price because its conversion price is fixed at Rm 4.05 and you will make more profit.