DXN Holdings Bhd eyes global expansion with a positive outlook for future growth, driven by robust revenue projections and strategic market expansions, according to CGS International Stock Broking House in their recent report (July 15, Monday).
CGS said it has resumed coverage on DXN with an Add recommendation and an unchanged GGM-based target price of RM0.85, following a thorough review of their estimates. The firm anticipates a 3-year EPS CAGR of 13% of the fiscal year 2024–2027 forecast (FY24–27F), underpinned by expanding membership, new product introductions, and penetration into new markets.
CGS maintains a GGM-based target price of RM0.85, highlighting DXN's undemanding valuation at 7.7x calendar year 2025 with price per earnings (CY25 P/E), a 25% discount compared to global peers. The stock also offers an appealing FY25-27F dividend yield ranging from 7% to 10%, further enhancing its investment attractiveness.
DXN's revenue trajectory remains strong, projected to achieve a 12% CAGR over the next 3 years (FY24-27F). This growth will be supported by a growing active membership base of 5.4 million across 180 countries and sustained expansion into high-growth markets like Brazil, Argentina, Algeria, and Ghana. Additionally, the fortified food and beverage segment is expected to contribute significantly, following a robust 21.8% CAGR from FY20 to FY24.
CGS identifies potential catalysts for DXN, including accelerated membership growth and stronger-than-expected earnings performance, which could drive a re-rating of the stock in the near term.
