Top Glove’s Uphill Climb: Can It Regain Investor Confidence?
Once a pandemic darling, $TOPGLOV (7113.MY)$ is facing a tough reality. Its latest quarterly results have sparked renewed concerns, with shares sliding ~45% YTD and hitting near 2023 lows.
The Headwinds:
1. Earnings Disappointment: Q3 FY25 net profit dropped 31% YoY to RM34.7M, missing full-year consensus forecasts.
2. Intense Competition: Chinese rivals are aggressively targeting non-U.S. markets with competitive pricing.
3. Bearish Analyst Sentiment: Only 4 out of 21 analysts rate the stock a "buy," with most on "hold" or "sell."
Bright Spots & Strategic Moves:
1. Still Profitable: Remained in the black for the third consecutive quarter.
2. U.S. Market Momentum: North American sales are a bright spot (26% of total), benefiting from lower costs and a temporary tariff advantage over Chinese imports.
3. Cost Parity: Has matched Chinese rivals' breakeven cost for nitrile gloves (~$14-15/1,000 pcs) through aggressive cost rationalization.
The Investor Outlook:
Top Glove's turnaround is in motion, but it's slow. The company is showing improvements in efficiency and U.S. market positioning, but the overall landscape remains brutal with intense pricing pressure.
Investors are likely to remain cautious. While the valuation is beaten-down, a sustained earnings recovery and a more balanced supply-demand environment are needed before confidence fully returns.
Is Top Glove a long-term recovery play, or are the headwinds still too strong? #BursaMalaysia #GloveStocks #Investing
Disclaimer: Community is offered by Moomoo Technologies Inc. and is for educational purposes only.
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103524630 : can buy now?
103457641 103524630 : why you want to buy? game over years ago. before covid there were very few manufacturers. even top glove capacity was small. price of glove was cheap. then covid 19 came. deadly....demand far exceeded supply. price shot up very high. all glove manufacturerd increase capacity. profit was a multiplier effect. many players from diff countries came in ..pandemic became mild. demand drop drastically. all factories now over capacity. price war. future bleak.
i am writing this to tell you to move on. dont cling to the past cash cow.
there are many other better stocks to buy.
if you have this stock. RUN