PETALING JAYA: Pentamaster Corp Bhd
’s earnings outlook faces near-term pressure given the weaker showing of the company’s automated test equipment (ATE) segment in the first quarter ended March 31, 2026 (1Q26) as well as the newly commercialised healthcare segment.
Its 1Q26 earnings came in below both Phillip Capital Research and UOB Kay Hian (UOBKH) Research’s expectations.
Phillip Capital Research downgraded its call for Pentamaster to a “hold” from a “buy”, albeit with a higher target price of RM4.10, as it believes the company’s earnings recovery story has largely been priced in at a forward 31 times 2027 earnings per share, with fundamentals running ahead of valuation.
It said the 1Q26 core net profit of RM15mil was below the house’s and consensus expectation, with the shortfall due to larger-than-expected losses from the newly commercialised healthcare segment.
Moreover, the research house believes the healthcare segment would likely be loss-making for the rest of the financial year ending Dec 31, 2026 (FY26), given its early-stage commercialisation phase.
The company’s outstanding order book rose 20% quarter-on-quarter in 1Q26 to RM480mil, with medical contributing 55%, consumer and industrial products (24%), followed by automotive (11%), opto-electronics (6%), and others (5%).
UOBKH Research noted that by end-market sales, the medical and electro-optical segments rebounded strongly, driven by recovering demand for factory automation solutions (FAS) and test handling solutions.
However, the automotive segment – previously the largest contributor in 2025 – saw its revenue plunge 50% year-on-year, mainly due to the timing of project deliveries.
UOBKH Research maintained its “hold” call on Pentamaster with a higher target price of RM4.20 (from RM3.50), as the share price has staged a notable rebound from the March trough of RM2.84, underpinned by improving industry sentiment and sustained optimism surrounding artificial intelligence (AI)-driven demand.
Kenanga Research said the company’s FY26 should remain anchored by FAS, expected to contribute over 50% to revenue, while ATE could benefit from AI/high-performance computing demand and the commercialisation of its “9 Samurai” advanced packaging projects.
It downgraded its call to “market perform” from “outperform”.
