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1. Cyclical base effects: The glove cycle is normalising from a depressed earnings base; single‑year growth rates can look optically high and may not be sustainable. The Star/Phillip Capital note underscores recovery timing (FY27) but also continued pricing pressure near term.
2. Yield term is nil right now: Lynch’s PEGY variant gives some credit for dividends; with ~0% TTM yield, there’s no uplift to fair value from income at present.
3. Use multiple lenses: Lynch FV is a “heuristic”. Cross‑check with other methods (e.g., normalised P/E on mid‑cycle EPS, EV/EBITDA on FY27–28E, or DCF) before making decisions. (ValueSense and StableBread both present it as a quick screen, not a standalone intrinsic value.)
Glove stocks are cyclical. The market sometimes prices the rebound 12–18 months early.
Since earnings expected to recover FY27, the “value window” may close in FY26.
If your horizon is long (2026–2029):
Buying at RM0.80–0.95 may still deliver strong multi‑year upside
But buying below RM0.70 offers a much better margin of safety
