kcchongnz blog
i3investor Stock Pick Challenge 2017: Fibon Berhad kcchongnz
In 2017 i3investor stock pick challenge, I have chosen Fibon, when it was trading at 55.5 sen on the last day of year 2016, as one of my five stocks in a portfolio as shown in the link here:
http://klse.i3investor.com/servlets/pfs/71070.jsp
On 17th February, it closed at 74 sen. The gain for this one and a half months is 30%.
Here was a good question posted in the link above:
[Posted by fatty_tang > Jan 10, 2017 08:42 PM | Report Abuse
mr. kcchongnz why fibon btw?]
Someone has answered in my behalf in the same link, albeit partially:
[Posted by Op3rs > Jan 3, 2017 09:32 AM | Report Abuse
all cash cow.]
Since I have posted Fibon as a stock pick for 2017 in i3investor, as usual, I would like to share the reasons why I have chosen it for sharing purpose.
The business
Fibon is a technology company that formulates and produces advanced polymer matrix fibre composites and manufacturing and sales of electrical insulators, electrical enclosures and meter boards. Its main markets are in Malaysia, Singapore and Australia.
Fibon has acquired a factoring company not long ago. However, its whole business doesn’t really grow much since it was first listed in Bursa in the year 2008, with group revenue and earnings peaking at just RM18.14m and RM5.77m respectively for the last twelve months ending 30th November 2016.
Share price performance
Fibon was listed in Bursa in 2008 at an IPO price of 84.5 sen. Its share price went up to RM1.10 in early 2010 due to the initial good financial performance. However, due to a drop in its net profit by more than 50% for the year ended March 2012, its share price plummeted by more than 40%. Since then it never seems to be able to recover and remained as a fallen angel for a long time. On 2 August 2013, its share price stayed at its low level at 32.5 sen as shown in Figure 1 below.
That was when I picked Fibon for my “Stock Pick Challenge 2013 2H” as shown in this link.
http://klse.i3investor.com/blogs/stock_pick_challenge_2013_2h/34374.jsp
Immediately after that, its share price shot up to 60 sen within about three months, and then retreated to 40 sen in the third quarter of year 2015, before going up again and close at 55.5 sen at the end of year 2016 when I selected it again as one of my stock picks. It closed at 74 sen last Friday on 17th February 2017 as shown in Figure 1 below.
Figure 1: Historical share price of Fibon
Selection criteria for Fibon
I have deliberated my selection criteria of the 5 stocks for the 2017 i3investor stock pick challenge as published in i3investor in the link below.
http://klse.i3investor.com/blogs/kcchongnz/113511.jsp
Fibon’s business is nothing great in term of growth as mentioned above. The selection of Fibon was based on the principle my favourite Magic Formula Investing of choosing good stock selling at cheap price as discussed in the above link. The goodness is manifested in its high return on invested capital, ROIC, of 48%, 4 times its cost of capital. This “Return” of just a few million Ringgit a year, is nothing to shut about, but it is consistent. It also has consistent free cash flows, and a healthy balance sheet with no debts, but plenty of cash, in excess cash amounting to half of its market capitalization then.
A good company is not necessary a good investment. It all depends on what price it is offering.
Investors who are just looking at the simplistic price-to-earnings ratio may not see it as an attractive investment as at 55.5 sen, the PE ratio was closed to 10, not cheap for a small capitalized and little growth company. However, if one takes away its excess cash and look at the core PE ratio, or the enterprise value of its core business, it was selling very cheap at a Ebit multiple of less than 5.
A high ROIC, good FCF, and zero debt company, with consistent earnings and FCF, zero debt and plenty of excess cash, selling at that ebit multiple, is very cheap.
That was why I choose Fibon as one of the stocks in the i3investor 2017 stock pick challenge.
“It is not necessary to do extraordinary things to get extraordinary results.”. Warren Buffet
I am still teaching investors who wish to find as well as providing good companies selling at cheap prices to invest in for building long-term wealth. If you are interested, please contact me at
ckc13invest@gmail.com
KCChong
Related Stocks
| Chart | Stock Name | Last | Change | Volume |
|---|
Market Buzz
More articles on kcchongnz blog
Insas Warrants WC and Its Valuation kcchongnz
Created by kcchongnz | Jan 22, 2024
Which to buy, Insas or Insas WC?
Isn’t this the most undervalued stock in Bursa?: Insas Berhad by Kcchongnz
Created by kcchongnz | Jan 15, 2024
2024 New Year Reflection Investing in the Stock Market: Timing the Market
Created by kcchongnz | Jan 01, 2024
2023 Christmas reflection on pitfalls of investing in the Malaysian stock market kcchongnz
Created by kcchongnz | Dec 25, 2023
Introduction: The Complete Dividend Investing Guide That Works by K C Chong
Created by kcchongnz | Oct 02, 2022
Discussions
8 people like this. Showing 50 of 93 comments
Thats why raider say u NO business sense loh....!!
Last year mkt down should have more confidence to sailang compare with mkt up this year loh....!!
W.BUFFET SAYS U SHOULD BE MORE AGGRESSIVE TO BUY WHEN PRICE DOWN AND NOT WHEN PRICE UP MAH....!!
2017-02-20 13:53
raid
my confidence is internal......its me and my own experiences, nothing to do with you ........
of course, if you have been losing money, you should slow down.......
2017-02-20 13:57
This is the America I like
http://pix11.com/2017/02/19/historians-rank-obama-as-12th-best-us-president-in-new-survey/
and Obama is one of the Great Presidents, Hillary would have been fine.
2017-02-20 14:01
ranked by historians........these are educated people......
but raid...you are uneducated.
http://pix11.com/2017/02/19/historians-rank-obama-as-12th-best-us-president-in-new-survey/
2017-02-20 14:12
HISTORIAN ARE USELESS....THEY ALWAYS STICK TO THE NORM LOH...!!
TRUMP IS NOT NORM LOH....!!
TRUMP IS THE GREAT GAME CHANGER MAH...!1
HE DARE TO BE DIFFERENT LOH....!!
2017-02-20 14:15
raid
I know...all Trump people have no respect for education or knowledge..............just like you.
2017-02-20 14:17
WHO SAYS ??....TRUMP WANTS TO MAKE USA GREAT....!!
EDUCATION & KNOWLEDGE AND TECHNOLOGY VERY IMPORTANT LOH....!!
BUT TRUMP UNDERSTAND PURE ACADEMIC KNOWLEDGE NO USE...U NEED APPLIED KNOWLEDGE MAH....!!
JUST LIKE BILL GATES...A DROP OUT...NO DEGREE... BUT HE IS USA ONE OF THE GREATEST ENTERPRENEUR....BCOS HE USE APPLIED KNOWLEDGE...NOT JUST ACADEMIC THEORY LOH...!!
2017-02-20 14:21
Raid...a Trump parrot like you do not impress me, just makes your self look like an idiot.
2017-02-20 14:29
no need to impress u...loh...!!
Just take note Trump good for mkt mah...!!
2017-02-20 14:33
raid
who likes dictators and narcissist Presidents?
I guess raiders and people of weak characters pray for dictators...white idiots and white cowboys too.
2017-02-20 17:07
Trump is not dictator...he is democratically elected loh....!!
In fact, he is the President of the most democratic country in the world.
Trump has great leadership and strong will to carry thru american people wish loh.....!!
2017-02-20 18:05
raider
I know of no educated person who speaks of Trump the way you do. Serious.
In the run to the elections, no major newspaper in America endorse the Donald. There is no Ivy League university Professor who has a kind word for the Donald.
The Donald is the butt of jokes in educated society.
2017-02-20 18:42
Mammy,
That means ur circle of friends all stucked up loh....!!
A person who dare do thing differently from the norm....alot of people will misunderstand initially loh.....!!
Give him time....u will see great result loh....!!
For a start stockmarket already up loh...!!
2017-02-20 19:14
birds of same feather flock together.....I sure have no interest in any idiots.
2017-02-20 19:21
U r very naive & low standard loh....very hard to progress loh....!!
Let be broad minded....& u will progress better loh...!!
2017-02-20 19:46
Progressive, reformist, transformer are type of people who want changes for the better....these are the visionary people that supported trump loh.......!!
2017-02-20 20:19
one respectable name.
one name that means educated and intellectual and Trump supporter.
2017-02-20 20:46
anyway
I am not surprised as you are a very poor judge of character.
raid, you are just a phony.
an uneducated phoney
2017-02-20 20:54
one respectable name.
one name that means educated and intellectual and Trump supporter.
one name that is not a politician, not a right wing extremist Christian nut.
2017-02-20 21:47
Paul Ryan, well reaspected speaker mah....!!
He support trump loh....!!
Most american Churches support trump mah...!!
GoldMan Sach also like Trump....!!
Most importantly Warren Buffet started to like Trump loh...!!
2017-02-20 22:18
crazy la.....Politicians (Paul Ryan) words you can trust?
Warren Buffet.....in the campaign, WB volunteers to drive at least 50 voters to vote for Hillary......
Strong dedicated campaigner for Hillary. WB wannabes should have the same values as WB.
Now, that the election is over......WB go back to become business man. What choice he has?
the previous post, I mean educated intellectuals, not politicians, not Christian right wing nuts, respectable independent chaps....thousands of them.....thousands around the world....name one that likes Donald Trump.
2017-02-20 22:35
raid... I am a reading man...and you are a phoney and a very poor judge of character.
2017-02-20 22:42
Posted by stockmanmy > Feb 20, 2017 10:35 AM | Report Abuse
kc
If you say Dynamic Investing is gambling.
ME:DID I SAY ANYTHING ABOUT "DYNAMIC INVESTING" IS GAMBLING?
WHAT I AM ASKING IS WTH IS YOUR THIS "DYNAMIC INVESTING"? HOW YOU MAKE MONEY? PLEASE ELABORATE WITH EXAMPLES.
I'd say buying a share monthly revenue is slightly more than $ 1 million is excessive gambling.
ME: WHAT IS INVESTING, AND WHAT IS GAMBLING?
TO ME, STUDY THE BUSINESS OF THE COMPANY WELL, HOW IT MAKES MONEY, HOW IS THE RETURN ON CAPITAL, WHETHER EARNINGS AND CASH FLOWS ARE GOOD, BALANCE SHEET, ETC. IS INVESTING, WHETHER THE COMPANY IS BIG OR SMALL.
WTH "DYNAMIC INVESTING", WTH "PIVOTAL MOMENT", "FOCUS AND MARGIN", "SAILANG" ETC. ARE WHAT? INVESTING? NOT EXCESSIVE GAMBLING?
Such a small company, where got stability? predictability?
ME: LOOK AT HOW FIBON HAS BEEN DOING THE LAST FEW YEARS. AREN'T THEY MAKING CONSISTENT EARNINGS AND CASH FLOWS?
PREDICTABILITY? WHERE DID I USE THE WORD "PREDICTABILITY"
I don't know la....I have never bought shares of such a small company before.
ME: THAT IS WHY YOU HAVE NOTHING TO SHOW SO FAR. ABSOLUTELY NOTHING!
Uncle K even worse....there is no way such a small company share can provide the liquidity for him.
ME: OF COURSE A SMALL COMPANY LIKE THAT IS HARD TO MANIPULATE.
2017-02-21 12:58
ME: OF COURSE A SMALL COMPANY LIKE THAT IS HARD TO MANIPULATE.
kc...you stock market man or not?
how can you say such a sentence?
TEnaga and Maybank la....even billionaires cannot manipulate.
2017-02-21 13:09
Kf, how about flbhd? Look like a little bit slow compared to others... Mind to share?
2017-02-21 13:32
Posted by stockmanmy > Feb 21, 2017 01:09 PM | Report Abuse
ME: OF COURSE A SMALL COMPANY LIKE THAT IS HARD TO MANIPULATE.
kc...you stock market man or not?
how can you say such a sentence?
TEnaga and Maybank la....even billionaires cannot manipulate.
I thought you are s street smart guy. but you don't seem to understand what I was trying to tell you.
2017-02-21 13:51
Kc
To evaluate a company with small $1 million a month revenue.....
First be prepared to break all rules normally used in evaluating other shares.
I means all formulas and accounting ratios so loved by you.
The accounting information is quite meaningless.
How you say it? The butterfly effect and a small breeze the house also come down.
2017-02-21 14:00
Posted by stockmanmy > Feb 21, 2017 02:00 PM | Report Abuse
Kc
To evaluate a company with small $1 million a month revenue.....
First be prepared to break all rules normally used in evaluating other shares.
I means all formulas and accounting ratios so loved by you.
The accounting information is quite meaningless.
Can you tell us the truth, what did you do for a living before you retire?
2017-02-22 06:52
To be super investor, stay focused.
To be value investor
Stay Focused Lumber
One enough, no need to spray all over the place.
$1 million revenue per month sounds like a coffee shop
Not a listed public company for value investor.
2017-02-22 08:42
crazy la.....Politicians (Paul Ryan) words you can trust?
Warren Buffet.....in the campaign, WB volunteers to drive at least 50 voters to vote for Hillary......
Strong dedicated campaigner for Hillary. WB wannabes should have the same values as WB.
THESE ARE OLD NEWS...W BUFFET ARE SINGING PRAISES ON TRUMP LOH...!!
BCOS HE UNDERSTAND TRUMP IS A GREAT LEADER WHO WILL STEER USA TO GREATNESS...IN WHICH NO OTHER PRESIDENT DARE LOH...!!
Now, that the election is over......WB go back to become business man. What choice he has?
WB A MAN OF PRINCIPLE MAH...HE NO NEED TO CARRY TRUMP'S BALLS WITH HIS STATURE LOH..!!
IT IS GENUINE FONDNESS LOH...!!
the previous post, I mean educated intellectuals, not politicians, not Christian right wing nuts, respectable independent chaps....thousands of them.....thousands around the world....name one that likes Donald Trump.
PAUL RYAN IS A GOOD NAME & GOLDMAN SACH N GANG ARE ALL VERY POSITIVE LOH...!!
2017-02-22 09:10
raid
you want to be Warren Buffet student
WB wannabe
but do not have WB values.
it does not work that way
that is not the way it works.
2017-02-22 09:14
raider, u are too ego to accept and admit that u r wrong.. Human make mistakes..
2017-02-22 09:41
superma,
How can raider be wrong ?....after trump elected mkt booming loh...!!
Just that public uncomfortable bcos trump do not follow the norm loh..!!
Trump need to be like that...bcos in order to steer USA to greater heights mah....!!
The rest of the past presidents just follow norm...don dare to do anything different much...even they know something is wrong loh...!!
2017-02-22 09:46
so why value investing don't work?
its because cheap stuffs got no good stuffs
good stuffs are not cheap.
There is no better example of value investing than Focus Lumber with such low PE and high returns on invested capital. If it does not work, you have to re examine the whole theory of value investing.
2017-02-22 12:22
haha... stockman is again showing his "KYY-PLP'ing" skill to us... haha
2017-02-22 13:18
Dynamic investment had caused many many losers like FLB, Gadang and now CSC loh.....!!
Dynamic investment is nothing more than pump & dump loh...!!
Just that KYY package like he is a great sifu loh...!!
Value investment is sustainable success formula loh...!!
2017-02-22 16:05
Posted by kcchongnz > Feb 22, 2017 06:52 AM | Report Abuse X
Can you tell us the truth, what did you do for a living before you retire?
Posted by stockmanmy > Feb 22, 2017 08:32 AM | Report Abuse
I think I will let you guess
Snake oil salesman?
2017-02-22 16:44
Post a Comment
Featured Posts
Latest Videos
MQ Trading Signals
Time
Signal
Duration
Type
2024-11-15 15:00:00
OBV
30 Mins
SELL
2024-11-15 09:00:00
EMA 5
10 Mins
SELL
Apps
Top Articles
1
6
7
8
BFM Podcast
#
Stock
Score
Daily Stocks
Stock Name
Last
Change
Volume
Stock Name
Last
Change
Volume
Stock Name
Last
Change
Volume
Featured Advertisers / Partners
Ride The Bull Short The Bear
CS Tan
4.9 / 5.0
This book is the result of the author's many years of experience and observation throughout his 26 years in the stockbroking industry. It was written for general public to learn to invest based on facts and not on fantasies or hearsay....
stockmanmy
jon....
I am happy right now....the future not yet here.
But, I certainly have more confidence to sailang than last year.
2017-02-20 13:49