Why focus on a stock where you know for sure the profits and selling prices will go back to pre-pandemic levels...it doesn't matter if its this year or next...and where the longer you hold, the closer we get back to normalcy and the lower the value...
Where something that sold for USD 20 is now sold for USD 200 with no fundamental change - gloves are still gloves, they cant make you fly - and where supply is unlimited, you can keep making them - unlike land which is finite...
My sincere advice is to switch to recovery stocks, top pick Genting Berhad. FA, TA/Chart are all aligned. Its still early days and if you get in now I'm sure you can make back what you have foregone in Supermax and Top Glove
Looks like a bear trap. The glove stocks are in downtrend mode. Never catch a falling knife regardless of how good earnings are in the short term. It won't last as their ASPs were mediocre before the pandemic. It will retrace once the vaccine is distributed and given within the next 12 months. Gullible traders got carried away thinking the party will last forever.
Posted by emsvsi > Jan 5, 2021 10:01 PM | Report Abuse
Dear Koon Yew Yin,
Why focus on a stock where you know for sure the profits and selling prices will go back to pre-pandemic levels...it doesn't matter if its this year or next...and where the longer you hold, the closer we get back to normalcy and the lower the value...
This paragraph sums up all - the disconnect between profit n price as markets are never rational since day 0.
Buying stocks is based on opportunity cost..you buy into weakness and sell on strength...it is not that the glove stocks are not good it is that there are better alternatives when it comes to investing. we are talking about investing and not discussing gloves in perspective, hope this is clear to you?
Long term economics of glove stock undeclared: you buy something when it is useful to other people, investing is not about eps because eps already factored into share price or blown out of proportion. you buy something because you expect business to grow because of other factors outside the company. The company can grow and grow but this should not be the account for you to buy its shares. business growth comes from outside company not the company's own growth (not the company's own business expansion), you get this clear or not.
For the gloves to experience forever growth: it means you are predicting the pandermic to go out of hand..... that the pandermic situation will go out of control (business growth depend on development outside the company and not the company's own factories' growth). this is less lightly to happen because our life is going to go back to normal not in the same way like before of course.
This gloves does not have new role in people's life..how growth outside company going to come. electric cars is car transformation...petrolium is the amount of car on the road...see it all depends on factors outside the company to determine whether we buy a stock or not. The stock itself...whether selling gloves or what it is eps is not really a matter to consider for buying a stock for an investors because we are investors and not doctors who do the innoculations for people..we are investors not doctors. common, please don't mislead people especially when you are malaysia's stock icon like warren buffett of malaysisa.
in brief....The two situations: 1. you need pandermic patients to grow forever, this is not going to happen because by then we all already kena ourselves.. . what for we need to buy any more stocks right. 2. new role for gloves..you can not wear gloves on your legs or not on your head...that is called condoms. even condoms experience stagnation because you can not find new roles for condoms.
The conclusion....This is called junk bonds especially they issues so much shares to dilute the company's existing net assets per share. please dont ask people to buy junk bonds.
TG 28 factories just resume operation. If Tan Sri said the impact of 1 month partial shutdown to the Revenue and profit in AGM? Will today EPF selling again due to political unstable?
Now glove stock come back lo..cheap that time dun want to buy? Pandemic out of control in many countries already. Have to face reality la..Like it or not no one know haw many times virus will mutate you want wait TOP 4 up 10% only buy meh. Palm oil already all time high still chase for what?
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....
abcb
3,096 posts
Posted by abcb > 2021-01-05 21:23 | Report Abuse
Keep on promotion his own portfolio of Supermx