Another stock comparable to FLBhd is Liihen which possess cash of RM 120.4mil in cash and FD with a borrowings of just RM 6.9mil. The cash yield of LiiHen is 18% much more than our banks FD.
when the share price drop until it has no logic, the return on average capital employed is 25%, the X factor of the company has become negative, it is time for the Company to issue some clarifications.
ROCE is profits divide by assets employed. High ROCE means high profits for every $ employed.
it reflects the fact that is a very neat and simple operation.
problem with this kind of company...what happens after 1 or 2 good years?
it will be the same sawmill, with the same machineries and subject to the same limiting factors such as raw logs and market conditions.
has there been any transformational change? what steps taken to put the company to the next level? expansion plans? steps taken to reduce the company risks and fluctuations?
we call that, the negative X factors that quickly come to people's mind when share price drop until no logic.
Meaning that for expansion plans in future,it has to increase its CAPEX which may eat into its FCF. However with its so much cash that it has currently, I think FLBhd can grow aggressively.
pros and cons...very important. That tests the analytic abilities.
all share prices have two components....valuation of existing business plus the X factors. X factors can be positive or negatives, it is market's valuation of the Company's growth or negative growth discounted backwards.
everyone should pay equal attention to the X factors, not just the results announced.
Successful people are quick to make decisions ( I include KYY in the category of successful people) slow to reverse decisions made.
Successful people have a bad habit they have to watch out for. They loath, hate to change decisions as doing that is an attack on their ego. ...in the stock market, this can be very painful.
For common people, we have to push them to make decisions,
For KYY, we have to push them before they can reverse their decisions.
Agreed that IQ is cash-rich with no borrowings. But its 3rd Qtr earning is a poor show when compared to the corresponding period of the previous year. It has dropped 31.85%. It's a good stock to monitor. Watch the chart for a good entry point.
Dear rosmah yes i think lii hen can pare down the debt fast. Lii hen net cash 90mil meaning 50c per share net cash. EPS 10c last 3 months. Liihen shud be able to earn 30-40c per share this year. Applying pe of 10x lii hen is worth 3.00 to 4.00
Rosmah, where you get news min wages impose in West only. East Msia also impose min wages, just the different is Sabah have too many Foreign worker until Immigration unable to take action in most sector. Even Kopitam also employ foreign worker
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....
shareinvestor88
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Posted by shareinvestor88 > 2016-03-20 17:50 | Report Abuse
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