KUCHING: Resilient businesses such as fertility services and data/document processing companies are stretching their winning run and are expected to experienced another strong year going forward.
OSK Research Sdn Bhd (OSK Research) in its 2010 Invetsment Strategy report also observed that companies like TMC Life Sciences and Efficient are on track to achieve 10 consequetive years of revenue growth.
It said that Efficient’s net profit is also expected to increase for the seventh consequetive year.
TMC Life Sciences’s earnings could also improve in tandem with revenue growth but its winning strecth was broken in FY2008 due to start-up losses from its Tropicana Medical Centre.
It pointed out that Efficient’s FY 2010 price earnings ration (PER) was still attractive, while TMC Life Sciences’ bottomline was still pressured by the new hospital’s gestation period.
The research firm forsaw mixed performance from other technology businesses. It projected that CBS Tech should be able to grow its FY2010 earnings by 27 per cent as approximately 40 per cent of the contribution was expected to be derived from the acquisition’s profit guanrantee.
JobStreet it pointed out was a world-class e-recruitment company expected to see low earnings growth in Fy2010 as unemployment may remain high for a longer period in spite of a recovery in the world economy.
It also noted that cyclical technology business was bottoming out with worldwide shipments of semiconductors and hard disk drives (HDDs) having increased since first quarter of 2009 amidst improvement in the world economy.
The semi-conductor Industry Association (SIA) was projecting worldwide sales of US$195.6 billion for 2009, down 21 per cent from US$248.6 billion in 2008 but sales are expected to rebound in 2010, with a projected 6.5 per cent year-on-year (y-o-y) growth to US$208.3 billion followed by 6.5 per cent growth in 2011 to US$221.9 billion.
Overall, OSK Research noted that the share prices of technology companies have done well.
It projected that if the optimism in the equity market remains high in 2010, these technology companies would be able to continue to expand their PERs.