Key Takeaways Renewed US-Iran tensions pushed Brent crude briefly above US$80 , reigniting concerns over global energy supplies. Despite geopolitical uncertainty, Wall Street avoided a sharp sell-off , suggesting investors believe the conflict remains manageable for now. Higher oil prices have revived expectations of a Federal Reserve rate hike , as markets worry about renewed inflation. Technology stocks remained relatively resilient , showing that AI continues to provide underlying support for equities. The next move in oil prices could determine whether market volatility returns. Market Insight When news broke that the US had launched fresh strikes on Iran , investors immediately rushed into the oil market. Brent crude briefly climbed above US$80 a barrel , as fears grew that escalating tensions could disrupt supplies through the Strait of Hormuz , one of the world's busiest energy shipping routes. Yet the reaction in equities was far more measured. Although the S...
Shares of Homeritz Corp Bhd (KL) surged to their highest level in six weeks following the furniture manufacturer's better-than-expected third quarter results, despite analysts maintaining a cautious outlook.
Key Highlights:
Share Performance:
- Homeritz shares rose by 3.4%, or two sen, to 60.5 sen, the highest since June 18, 2024.
- Trading volume totaled 210,900 shares at 9:20 am.
- The company’s market capitalization stood at RM280.63 million at the last price.
Analyst Ratings:
- Public Investment Bank and Hong Leong Investment Bank (HLIB) maintained ‘hold’ calls on the stock due to limited upside potential.
- Public Investment Bank raised its earnings forecast by 6%, now expecting Homeritz to make RM33.1 million in core net profit, with a target price of 61 sen.
- HLIB’s target price for Homeritz is 62 sen, noting that the current valuation is “fair,” trading close to its five-year mean of eight times forward earnings.
Market Conditions:
- Analysts remain conservative about Homeritz’s near-term trajectory due to high interest rates and persistent inflationary pressure.
- An uptick in sales volume is expected during the upcoming year-end festival season.
Potential Rate Cuts:
- Shares of Homeritz have risen nearly 18% year-to-date as investors speculate on potential rate cuts by the Federal Reserve (Fed), which could spur demand for homes in the US, a major market for Homeritz’s exports.
- HLIB noted that a potential recovery in the US housing market, driven by Fed rate cuts in the second half of 2024, could lead to higher furniture demand and benefit local furniture makers.
Financial Health:
- Homeritz’s strong balance sheet, with net cash of RM189.1 million or 40.8 sen per share, supports its share price, accounting for nearly 70% of its market capitalization.
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