Gloves still pique interest

Rakuten Trade’s head of equity sales Vincent Lau says there are trading opportunities for investors. “Valuations of glove stocks have come down reasonable levels. So when prices drop to a certain level, you see investors bargain hunting again, ” he tells StarBizWeek.

SHARES of glove makers, which were the hottest stocks at the height of the Covid-19 pandemic, have been heading south – sending valuations to “reasonable” levels.

As Covid-19 vaccination progresses in many parts of the world and investors shift to recovery plays in anticipation of things normalising, glove stocks continue to see price volatility.

But while some are fleeing, others are picking shares in this cluster of stocks following the price weakness and possibly the appeal of their dividend-related windfall earnings.

Rakuten Trade’s head of equity sales Vincent Lau says there are trading opportunities for investors.

“Valuations of glove stocks have come down reasonable levels. So when prices drop to a certain level, you see investors bargain hunting again, ” he tells StarBizWeek.https://sites.thestar.com.my/tsolnewsletter/default_story.aspx?s=business%2Fbusiness-news&k=corporate%20news&ku=tag%2Fcorporate%2Bnews

He said companies’ earnings will remain good, better than pre-pandemic levels even though average selling prices (ASP) are coming down.

In the month of March for example, the Employees Provident Fund (EPF) have been buying shares of Hartalega Holdings Bhd, whose shares are down by about a quarter year-to-date to RM8.98 yesterday.

The provident fund now owns 7.41% in the glove maker, up from 6% it held early in the year.

Likewise, the fund has also been seen picking up shares of Kossan Rubber Industries Bhd, bringing its stake in the company to 9.13% as at end-March.

 

Source : https://www.thestar.com.my/business/business-news/2021/04/03/gloves-still-pique-interest

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