(Kuala Lumpur News on 2nd) Recently, Malaysian stocks have shown weakness, especially since a continuous decline after August. Galaxy International Securities believes that considering the current valuation is still historically low, it is an excellent buying opportunity.
Galaxy International Securities pointed out in their latest report that the market performance has been rather flat recently, but they expect the overall P/E valuation to expand by 2025.
"Our recommended 20 preferred stocks have a P/E valuation of 12.8 times in 2025, providing an 18% two-year average compound annual growth rate (CAGR) and a 4.1% dividend yield."
Looking back at the Malaysian stock market trend, after experiencing three consecutive years of decline, the FTSE Bursa Malaysia KLCI rose by 15% year-on-year in the first eight months of this year, while the FTSE Bursa Malaysia All Share Index rose by 16%.
However, in the following three months, the Malaysian stock market has experienced a significant decline. As of the end of November, the composite index's rise narrowed to 10%, while the all share index rose by 13%.
Analysts believe that despite the 2025 budget continuing to emphasize the continuation of the prosperous economic reform and growth agenda, double-digit profit growth, the prospect of a stronger ringgit (despite the volatility caused by the possibility of Trump's second term), and accelerated domestic demand, the market performance is still lagging.
Stock prices have not kept up with profit growth.
Although the stock price has risen compared to the end of last year, the valuation still remains at the lower end of the historical range, yet to keep up with the pace of profit growth.
As for the just-ended third-quarter earnings season, analysts believe that the Ringgit against the US Dollar, which started at 4.72 at the end of June, rose significantly to the end of September...