Timber Industry

As everyone should know, the timber industry in Malaysia is going through a boom for quite sometime. Share prices of all timber counters have shot up by a huge percentage, some have even gone up more than 100% over the last 12 months. Big timber companies, for instance, TAANN have shot up from RM5.60 a year ago to currently trading at above RM10.00. Table above shows some of the timber related companies that I manage to extract. Do tell me which would be your best pick?

Mine would be CYMAO, first, the share price is currently at a consolidation stage (for quite sometime already IMO), secondly, its kind of undervalued compared to it peers. I think CYMAO can easily trade above RM2.00 based on its latest results. First 3 quarters CYMAO's EPS almost surpass the EPS for the entire year of 2005. Of course, many can say commodity prices is always fluctuating depending on demand - supply equation but can one guarantee the price to drop back to their all time low? If the high price is here to stay, now would be the best entry for CYMAO as it is undergoing consolidation.

Since CYMAO its more into plywood products, do go through the graph below. Hope it will change the minds of those who are pessimistic on CYMAO. Even JAVA which has a similar business structure as CYMAO has shot up RM0.38 last Friday. Latest plywood prices is between USD397 - 503 per m3 as of mid January 2007 as compared to USD340 - 448 per m3 a year ago. I am sure it is just a matter of time when CYMAO will get the attention similar to its peers.