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It rosed as it commemorated the ground-breaking for its first rig order yesterday. There are also rumours that it may announce the contract win of another 2 sets of oil rigs.
moving again after the bull has rested and battled the bear. Worth punting. expect upward movement very soon
Extracted from my blog http://kelongstocks.blogspot.com
[B]Technical Analysis[/B]
After gapping up to $1.32 on 13 Mar 06 on news that it was entering the rig building business, Labroy had been trading within a tight range within $1.43 to $1.55. Chart shows an ascending triangle formation, with prices testing the resistance at $1.59 on two occasions.
Today's candlestick was a small spinning stop but volume was extremely low, prices held above immediate support at $1.55. A breakout above the resistance at $1.59 on strong volumes could see prices heading towards a technical target of $1.75. Invalidated if prices break below $1.50.
...........continued at my blog
Extracted from my blog http://kelongstocks.blogspot.com
[B]Fundamental Analysis[/B]
Labroy reported a 40% rise in net profits for 1Q FY06 compared to 1Q FY05 largely due to a gain of $5.2m from disposal of fixed assets. However, compared to 4Q FY05, gross margins and net margins improved significantly (see table for restated P/L after stripping out "noises" such as lower provision of warranties, lower provision of doubtful debts and stock obsolescence).
This rise is attributable to improved shipbuilding revenue and lower effective taxes paid for the current quarter which helped to offset higher cost of sales. Shipbuilding revenue will continue to be the main contributor to the Group's turnover (outstanding order book of $540m) while growth will come from progressive recognition of two jack up rig construction contracts worth US$292 million for delivery in 2008/2009.
Labroy mentioned that its shipping division is expected to see stable freight rates but I rather be conservative and reduce revenue expectations from this business segment.
...........continued at my blog