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Frencken Group (SGX) Dated 21 July 2022


Frencken Wuxi Corporate Office



Frencken Monthly Chart, 10-year

Chart Source: tradingview.com



Frencken Group (SGX) had corrected close to 60% from its recent high of $2.45 in Sep 2021. Attached above is the monthly chart of Frencken using our Price Multiples Cycle strategy.


You can see that around every 3 years, the stock price of Frencken would experience about 12 months of sell-down before resuming its uptrend. Using this strategy, we can see that all 3 Price/Book, Price/Earnings & Price/Sales Cycle Indexes are indicating that the share price of Frencken is looking attractive again after the correction. Back in 2015 and 2018, we had witnessed its share price rising by 360% and 630% respectively.


Other than a attractive valuation, Bloomberg Analytics had also forecasted that its revenue and net income to continue growing at 10% to 15% p.a. over the next 3 years. Thus, we have a favorable combination of growing fundamentals and low valuation for Frencken.


On a short-term basis, price of Frencken had been consolidating sideways since late May 2022. Volume analysis had pointed to possible accumulation over the past 2 months. Hopefully, recent up move can spark off the momentum for the stock to restart its bullish trend.


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Disclaimer:

This is an opinion piece. Please always do your own due diligence on the company's fundamentals & assess if the Fundamental / Technical analysis opinions are applicable to your trading/investing needs.


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