MKLAND - SPECULATIVE BUY



MKLAND is a property development company in Malaysia, with its main projects concentrated in Damansara Perdana and Damansara Damai.

It is priced at 0.53, with EPS of 0.39 (taken from Annual Report 2006, have not been adjusted to reflect the true economic position of the earnings), and ending with a PE ratio of 13.

Before the Annual Report is release in November 2006, we could observe a relatively high volume long candle spike which could be indicating probable insiders or savvy investors buying before the release of information (from a technical charting perspective, without strong evidence). After the release of the Annual Report 2006, the volume increase dramatically with price trending up. It is now speculated that the price correction is reaching a strong support level according to Fibonacci retracement ratio. This price and volume action is the main reason which draw me to conclude MKLAND as a speculative buy.

Investors should also be informed that the overall trend for the stock is moving downwards. Fingers could be cut or burn if the reversal force couldn't withstand the fast falling knife momentum. Therefore, a stop loss is necessary.

Extra: The property development is a competitive business in Malaysia. While the Annual Report 2006 of the company argue that the company having competitive advantage because they are developing properties in strategic location (Damansara area, near IKEA, 1-U and etc.), it shouldn't be used as a signal to reflect that the stock is safe. After all, the cash flow for the company in 2006 is a big negative of 13 millions. Besides, i am issuing the BUY comment without truly scanning through all the information in the Annual Report. Thus, investors should never treat this investment opportunities as a risk free or safe and sound.

Thank you and wish you a profitable trade with MKLAND.