Capital Group hikes stake in ComfortDelGro

The group bought 1.65m shares at $2.94 each.

ComfortDelGro now has a new substantial shareholder. The mainboard-listed firm yesterday revealed that Capital Research Management Company, a unit of Capital Group of Companies, purchased 1.6475 million shares at $2.94 per share last week.

Capital Research Management Company now holds a 5.04% stake in CDL.

Data from CMC Markets show that CDL pulled back more than 10% after they announced their earnings in the middle of February. At these levels, the stock is priced at 22.3 X current PE.

“Recent news surrounding an increase in local ridership, together with a likely regulatory restructuring of their bus operations, will keep this stock under the spotlight of many traders. Although the stock pulled back from a high of $3.28 to around the $2.80 level after their results last month, the low of this move was still above their November high of $2.74, which would lend support that the uptrend move that started in January is still on track. A firm break of the $3.01 level may lead to a retest of the $3.28 high. Conversely, support for the stock remains around the $2.80 level. Failure to hold this may see Comfort pulling back to around the $2.47 level,” stated CMC Markets.