Here, we focus on identifying stocks that have experienced (and perhaps will soon) a 10% price pullback from recent highs, presenting potential buying opportunities. This 10% pullback strategy is based purely on technical analysis, especially price action, without delving into the underlying fundamentals of the companies. We aim to uncover stocks that are showing signs of recovery or consolidation, offering traders a chance to enter at a potentially discounted price. Please refer How to Choose Stocks for the 10% Pullback Strategy to choose stocks that are safer for using the 10% pullback strategy, ensuring that you’re buying into companies with solid fundamentals and long-term growth prospects.
Weekly Analysis
*Updated: 15 Mar, 2025
Buy Stock During Market Correction
| TENAGA 5347 | Stock Price | Remarks |
|---|---|---|
| Recent High | 15.24 | 4 Sep, 2024 |
| 10% | 13.72 | 1/3 of capital, set TP: 14.58 |
| 20% | 12.20 | 1/3 of capital, set TP: 13.72 |
| 30% | 10.66 | 1/3 of capital, set TP: 12.20 |
| Target Price | 14.58 | sell remaining stocks |
| Support 1 | 9.63 | |
| Support 2 |
Why Buy TENAGA Stock
Investing in Tenaga Nasional Berhad (TENAGA) can be an attractive option for several reasons, especially if you’re looking for stability and long-term growth. Here are five main reasons why TENAGA stocks might be worth considering:
1. Stable Revenue from a Monopoly in the Energy Sector
TENAGA is the dominant electricity provider in Malaysia, with a near-monopoly status in the transmission and distribution of electricity. This monopoly status provides a predictable and stable revenue stream, as most households and businesses rely on its services. Even in times of economic uncertainty, electricity consumption tends to remain relatively stable, ensuring consistent demand.
2. Regulated and Strong Cash Flow
The energy sector in Malaysia is highly regulated, and TENAGA operates within a structured tariff system. This regulation helps ensure a degree of profitability and stability, as tariff adjustments are made periodically to reflect rising fuel costs or inflation. Additionally, TENAGA has strong cash flow due to its substantial customer base, providing the company with the financial flexibility to invest in new projects or distribute dividends.
3. Diversification into Renewable Energy
TENAGA is actively diversifying its energy generation portfolio by investing in renewable energy sources, including solar, hydro, and wind power. This strategic shift aligns with global trends toward sustainability and decarbonization, providing TENAGA with growth opportunities in the green energy sector. As governments around the world push for a cleaner energy transition, TENAGA is positioning itself to benefit from these long-term changes in the energy market.
4. Government Support & Infrastructure Investments
The Malaysian government has consistently supported TENAGA through policy measures that ensure energy security and the development of infrastructure. TENAGA is also central to Malaysia’s energy transition plan, with projects focused on modernizing the grid and increasing energy efficiency. These government-backed initiatives help reduce risks for investors and offer long-term growth prospects.
5. Attractive Dividends and Strong Track Record
TENAGA is known for providing attractive dividends, making it an appealing stock for income-focused investors. Over the years, the company has demonstrated consistent profitability and has maintained a solid dividend payout ratio. Its ability to deliver regular dividends, coupled with a track record of stable performance, has made TENAGA a favorite among long-term investors seeking steady returns.
Of course, like any investment, there are risks to consider, such as fluctuations in global fuel prices, regulatory changes, or the potential for slower growth in the domestic market. However, TENAGA’s strong position in the energy sector, focus on sustainability, and stable financial performance make it a potentially solid long-term investment in Malaysia.