Masterskill Education Group Berhad (MEGB, 5166) was incorporated in1997. It was listed in Bursa Malaysia Main Market on 18th May 2010 at an IPO price of RM3.80. The shares price drop to below RM1.70 in March 2011 due to heavy share disposal by their foreign investor.
Regardless, on why foreign investors decided to dispose their shares, MEGB has a recession proof business with a good growth prospect.
They are going to pay good dividend yield too. In the IPO prospectus, MEGB specify that they intend to pay in between 50% to 60% from net profit as dividend. For financial year end 31st December 2010, they keep their promise and pay 60% of net profit as dividend. This translate to 14.9 sen & dividend yield of 7.2 %. This clearly more than double of current fixed deposit rate. Share price recover improve after 2010 final dividend announcement.
There are a few research house make buy recommendation for MEGB. The table below are the latest fair value or target price.
|Research House||Target Price (RM)|
The table below is the financial summary of MEGB for the past 3 years.
|Net Profit (‘000)||72,070||97,382||102,143|
|PE Ratio (x)#||21.61||16.00||8.31|
|Dividend Yield (%) *||N/A||N/A||7.20|
*Based on price on last trading day of the year
#Based on IPO price
On 21st April 2011, MEGB share prices close at RM2.12.
On 30th March 2011, MEGB declared 7.9 sen final dividend with an ex-date of 12th May 2011. At last trading price, the dividend yield for 2010 is 7%.
MEGB is a leading operator in Nursing and Allied Health education in Malaysia, principally engaged in the provision of higher education and training.
Among the key highlights from MEGB are,
- Steady cash flow
- Lower PE Ration when compare to peers. SEGi trading at 20 times while HELP trading at 12 times.
- Recession proof business with a good growth prospect.
- Approved to set up new campuses in Kuching and Seri Alam, Johor.
- Venturing to Indonesia and recently buy a stake in Indonesia’s Mayapada Hospital