$MAGNI (7087.MY)$
It is better to distribute special dividends when there is too much money and nowhere to spend it.
Many companies in the Malaysian stock market need to raise funds through rights issues and private placements due to lack of operating funds. However, there are also a few dozen companies that have the happy problem of not having enough places to spend money, and MAGNI is one of them, with a borrowing and cash level exceeding RM471 million.
MAGNI's latest quarter broke a 52-week high in stock price due to its excellent performance. Observing that NIKE's performance outlook in December last year was not as expected, I believe that MAGNI would also be affected. However, the performance in March was astonishing, which is likely due to the Paris Olympics this year, resulting in an Olympic boost that occurs every four years. With the growth in profitability, it is expected that the dividend for FY2024 will be between 11-13 cents. However, I still think that MAGNI can be more generous and distribute special dividends of 5-10 cents to shareholders, with the potential for stock price performance similar to HLIND and APOLLO.
Overall, Nike's outlook for March is an estimated 1% increase in FY24 revenue, mainly due to a slowdown in the Chinese market. It is expected that MAGNI's full-year profit for FY24 will be the highest in three years. Due to the higher base in 2024, the growth rate for FY25 is likely to be single-digit percentage based on NIKE's guidance.
MAGBI at present doesn't need to do too much Cape...