*NOL* 1QFY10 net loss improved by 60% y/y and 53% q/q to US$98m. The performance was notably driven by improvement in the container shipping business in Europe and Intra Asia. Despite the economic problems in Europe, some of these pressures can be offset by the US Transpacific contract freight renewals in April-May this year, which have been pegged at rates that are 80-100% higher than last year based on anecdotal evidence.
Likelihood of a stronger quarterly results in 2QFY10 is high. NOL is currently trading at 1.5x P/B.
The ongoing trade recovery could justify 1.7x P/B, which would imply a fair value of $2.47.
*NOL Technicals* For the past 2 months, NOL was range‐bound within the decending channel but the recent breakout above the resistance indicates that the pullback may have come to an end with the the previous resistance now becoming a support.
• From the daily chart, momentum appears to be gaining strength in the near term with the RSI punching above the reading of 50.
Price action is rather flat over the past 2 trading days but it is still trading
above the 200‐day EMA suggesting more upside ahead.
• Immediate support level lies at $2.08 with overhead resistance
levels at $3.60 and $3.79
No comments:
Post a Comment