Picture: Ivan Alvarado, Reuters

Johannesburg - Murray & Roberts, South Africa’s second-largest construction company, gained for a sixth day in its longest winning streak in two years as some investors see value in a stock that was among the worst performers in 2015.

“These guys had been sold off over the last year; people are seeing perhaps an opportunity with it being oversold,” Roelof Brand, an analyst at Avior Capital Markets, said by phone from Cape Town. “They are reporting results now towards the end of the month and people are taking this opportunity to hope for better-than-expected trading statements and buying on the weakness.”

Murray & Roberts rose 4.6 percent to R9.60 by the close in Johannesburg, the highest level since November 16. The stock has advanced 22 percent in the last six days, its longest winning streak since February 2014.

The stock slumped 62 percent last year, the sixth-worst performance among the 164 members of Johannesburg’s benchmark FTSE/JSE All Share Index, as falling commodity prices slowed growth in the South African economy, reducing demand for construction. The company is due to report first-half results on February 24.

Murray & Roberts is the best-performer in South Africa’s seven-member FTSE/JSE Africa Construction & Materials Index, gaining 20 percent this year. The gauge fell for the first time in 10 days on Monday, dropping 1.3 percent. The index is down 6.9 percent in 2016, compared with the 2.5 percent retreat in the benchmark.

The rally in Murray & Roberts may not have much further to run, one measure used by technical analysts suggests. The 14-day relative strength index has reached 75, the highest since June 2011, above the 70 level that signals to some analysts that a security may be overbought.

“They are going to continue to struggle in this commodities environment where they’re very exposed to oil and gas and other mining products,” Avior’s Brand said. “Murray’s is probably one of the most exposed to that and if capex doesn’t come back, which I don’t think they will in the short term, their order book is going to continue to deteriorate and they’re going to continue to struggle.”