PETALING JAYA: MyNews Holdings Bhd’s growth still appears intact despite near-term cost pressures, with earnings recovery expected by the second half of financial year 2026 (2H26), says CGS International (CGSI) Research.
In a report, the research house said it expects a continued earnings growth trajectory for the financial years 2025 (FY25) to FY28 core net profit at a compounded annual growth rate (CAGR) of about 40%.
“This will drive investor confidence and a re-rating of MyNews shares, which trade at an undemanding 13.8 times 2026 price-to-earnings ratio compared with its peers, which are trading at 15 to 25 times,” it added.
At a recent briefing, MyNews management explained that one-off repair costs in its first quarter ended Jan 31, 2026 (1Q26) arose from an unexpected leakage at headquarters, while most of the higher administrative expenses were due to software investments and restructuring
The management also confirmed that footfall at its store in Kuala Lumpur International Airport was negatively affected post the start of the Middle East conflict on Feb 28.
It noted that the resulting reduction in tourist arrivals from the Middle East and Europe was mitigated by stronger arrivals from China and domestic travellers.
Management guided that admin costs would stay elevated in coming quarters, albeit at a lower level than that of 1Q26.
CGSI Research noted that it has also imputed a higher effective tax rate due to lower profit estimates at MyNews’ CU stores stemming from lower tourist arrivals.
“As 2Q26 should be seasonally weaker due to Ramadan, we expect earnings to pick up in 2H26,” the research house added.
Following MyNews’ 1Q26 briefing, CGSI Research said it cut FY26, FY27 and FY28 core net profits by 22%, 5% and 2%.
However, MyNews’ revenue is estimated to rise at a three-year CAGR of 8.3% over FY25 to FY28, on the back of new store additions (about 60 new stores per annum versus over 30 stores in 2024), focused on higher-traffic locations, alongside the closure of weaker stores.
“The ready‑to‑eat offerings are gaining traction and driving higher basket sizes, which should support revenue growth, in our view,” said CGSI Research.
The research house has reiterated an “add” call on MyNews at a target price of 98 sen per share.
For 1Q26, MyNews’ net profit rose to RM4.07mil from RM3.87mil in the previous corresponding period, while revenue improved to RM238.44mil from RM215.87mil a year earlier.
In a note on its latest financial results, MyNews said the sequential growth in revenue was primarily driven by continued contributions from newly opened outlets and sustained consumer demand during the period under review.
However, the company said gross profit margin declined by 1% to 37.4% from 38.4% previously, primarily due to promotional activities.
