KUALA LUMPUR: Rakuten Trade suggests that Dayang Enterprise Holdings Bhd is primed to sustain its upward trajectory following a breakout from its three-week ascending triangle pattern.
Notably, the stock surged past the immediate resistance level of RM2.16, marked by a significant long white candlestick formation observed on Tuesday.
In a note today, Rakuten Trade underscored the stock's accomplishment of reaching a new 52-week high, accompanied by a sequence of four consecutive white candles, indicative of a positive outlook.
Furthermore, the robust bullish candlestick recorded recently was bolstered by heightened trading volume, signaling renewed buying interest.
Year-to-date, the stock has experienced an impressive surge of 43.75 per cent. The company's market capitalisation stood at RM2.66 billion at yesterday's closing price of RM2.30.
Rakuten Trade anticipates the continuation of this upward momentum, projecting the stock's potential to challenge the next resistance levels of RM2.44 (R1) and RM2.56 (R2) in the near term. A strategic stop-loss level has been set at RM2.02, positioned below the low recorded on February 8.
From a fundamental perspective, Rakuten Trade expresses a favourable view towards Dayang, citing its robust earnings growth.
This growth is underpinned by recent contract wins and renewals, anticipated enhancements in vessel utilisation and charter rates, particularly through its association with Perdana Petroleum Bhd, and an anticipated increase in offshore activities driven by Petronas Carigali.
Last month, Dayang announced that it won a three-year contract from Petronas Carigali for rectification works and associated services for Asset Integrity Findings (AIF), Package A, Sarawak Oil Asset. The contract runs from December 2023 to December 2026 and is estimated to be worth RM1.2 billion, boosting the company's orderbook to RM2.15 billion.
As a result, Rakuten Trade concludes that Dayang's earnings outlook and growth prospects remain promising.