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This Company Is Currently Trading Near A 52-Week High

I like to run a screen regularly to find companies with share prices that are near their respective 52-week lows.

Some great investors – such as John Neff and John Templeton – scour lists of beaten down stocks for potential investing opportunities. That’s because they believe that stocks that have fallen hard may be priced at lower than their real values.

But sometimes, I like to screen for companies that are near a 52-week high as well. This may seem counterintuitive at first.

Why am I looking for companies with climbing share prices? Thing is, over the long-term, a stock’s price tends to be heavily influenced by the performance of its business. So, companies with a rising stock price could be enjoying growth in their businesses.

With this in mind, let’s take a look at one company I chose at random from a list of companies that are currently near a 52-week high. The company in question is mm2 Asia Ltd (SGX: 1B0).

mm2-asia-52-week-high-share-price
Source: S&P Global Market Intelligence

mm2 Asia is a producer of films, television, and online content. It has three business segments, namely, Core business, Post-production, and Cinema operation.

The Core business segment is engaged in the production and distribution of motion pictures, video and television programs, and sponsorship. Meanwhile, Post-production comprises the company’s three dimensional (3D) stereoscopic animation, 3D animation, and visual effects services. Lastly, Cinema operation relates to the sale of cinema tickets, hall renting, and screen advertising.

The company has been aggressively pursuing growth since its listing in December 2014, such as by acquiring a cinema operator in Malaysia and signing a license to bring the singing competition program, “The Voice,” to Singapore and Malaysia.

In the six months ended 30 September 2016, mm2 Asia reported a 176% year-on-year spike in revenue to S$35.0 million. This drove a 97% jump in profit to S$8.85 million.

In the earnings release, mm2 Asia commented that Vividthree Productions, its 3D animation arm, “have shown their capability to develop intellectual property… that can be monetised over long periods across territories and various platforms.” mm2 Asia thinks that this has helped it to expand its library of content and improve its sources of recurring income.

The company added that it “will also continue to aggressively expand in the area of new media content.”

From the close of its first day of trading to today, mm2 Asia’s stock price has risen by an astounding 660%.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Lawrence Nga doesn’t own shares in any companies mentioned.