PetDag Shares Jump 6% After Earnings Blow Past Estimates

PetDag Shares Jump 6% After Earnings Blow Past Estimates - Shares of Petronas Dagangan Bhd

 (PetDag) surged as much as 6% in early trade after the company announced its earnings jumped three times.

The stock was up 6.48%, or RM1.40 at RM23 in early trade. It is the top gainer of the day. In the year to date, the company’s market shares has depreciated about 5%.

PetDag’s net profit in 3QFY17 jumped three times year-on-year to RM761.73mil, on higher sales volume, better margins and a gain on the disposal of a subsidiary;

During the quarter, the group sold its 100% interest in Petronas Energy Philippines Inc and a 40% interest in an associated company, Duta Inc, to P-H-O-E-N-I-X Petroleum Philippines

Revenue jumped 22.1% to RM6.69bil, thanks to 3% higher sales volume and an 18% jump in average selling price following the increase in Mean of Platts Singapore prices, it told Bursa Malaysia.

Hong Leong Investment Bank Research said PetDag’s earnings was above its expectations.

“3Q17 core net profit came in at RM330.5mil, bringing 9M17 core net profit to RM819.6mil, accounting for 83% of HLIB and 86 % of consensus,” it said.

It has upgraded PetDag to a “buy” call following the recent share price retracement. Nonetheless, it maintained the target price of RM24.64 pegged to 24x FY18 PER.