RGB (closed at RM0.22 yesterday) is trading at a trailing PER of 12.6x (based on last 4 quarters’ EPS of 1.74 sen). However, the company has cash of RM70 million as at 30/6/2016 (or 5.3 sen per share). If the cash is deducted from the share price, RGB’s trailing PER is only 10x.
The two gaming stocks listed on Bursa - GenM and Genting – are currently trading at trailing PER of 21x and 26x respectively. One can make a case that RGB should trade at similar PER as GenM or Genting. Assuming that RGB can command a PER of 20x, then its fair value would be RM0.35 (even ignoring the cash in hand of 5.3 sen per share).
Technical Outlook
1. Long-term Potential The chart below shows RGB breaking above the horizontal line at RM0.20. Its next resistance is at RM0.35. If the current rally can touch the horizontal line at RM0.35, RGB would give us an upside of 75%.
2. Short-term Risk The stock has risen quite substantially from RM0.17 to RM0.22 in the past 6 weeks. It has surpassed the line, XY at RM0.215. Failure to stay above this breakout level could lead to a correction to the horizontal-cum-psychological line of RM0.20.Below this level, the next support would be the line, BC at RM0.175.
dudu... unfortunately, RGB is no longer considered a "因低调而被市场忽各" share... it is a hot counter now... if you were buying RGB when it was trading around 10sen... then you can say : 在别人不买时从容买进,长期持守,可获厚利... now? hehe.. hoho.. hihi.. haha..
When gadang's price up tripple from RM1.2 to RM3.30 within 14 months, still got a lot of people buying. No body says it is over value and high chance to be trapped. Whereby gadang is a construction company, construction income margin is not stable. So PE should no be high, even PE10 is consider high.
look at P/BV and enterprise multiple of RGB, obviously it is overvalued at current share price... u buy now, very high chance to be trapped......
Referring too many investment bank analysis, where they usually look at P/BV. P/BV can not apply to all field of business. 投资分析不能死死用 P/BV。而且这个P/BV在投资上不是很有用的分析指标。随便几拿只股好像Nestle,Dlady,QL,Kawan来说,用P/BV来做标准,根本是盲点处处。
P/BV and EV/EBIT is a good way to calculate its intrinsic value... even for a good share, if you are buying at the high side, you are unlikely to make good profit... u are using Nestle, Dlady, QL & Kawan these bluechips to compare with RGB? is it fair? haha... ppl are willing to give higher valuation to these counters due to their consistent results... and... i agree that these bluechips are not cheap anymore so I will not buy any of them too... if you are buying Nestle, Dlady and QL today, do you think you will make much profit? unlikely, right?
publawyer678 : NTA of nestle RM2.81, share price RM79.00 If Nestle were to trade at the same P/BV as RGB, the share price should be <RM5.00 and not RM79.00. Understand?
Yalor, unbelievable !! Nowadays still got smart investors using P/BV to evaluate company meh?
if you want to apply P/BV, I recommend you Kekseng, Planitude, GOB, Asiapac, E&O, Orient, OSK, FACB, KSL, Trop, bjland and landmark. All these fulfil your requirement. But you invest at your own risk.
can u teach me how to know all auntie uncle discuss about wat share? don tell me those auntie uncle = ur father mother. really laugh die me. do u know how to draw chart? or c auntie uncle = drew it chart kikikiki
iloveshare128 : P/BV and EV/EBIT is a good way to calculate its intrinsic value... ========================================================================= Even though Cold eye 77 years old, he keep on improving investment method. Still using P/BV for calculate its intrinsic value ?? Laugh die people lo...
dudu, thanks for your sharing... i did mention about enterprise multiple (EV/EBIT) but you seem to ignore that... both P/BV & EV/EBIT are good methods to know if a share price is overvalued or not.. i agree that cash flow, dividends and growth are important too.. did i say they are not important? they are equally important.. but what I wanted to say is, I prefer to look for shares that fulfill as many criteria as possible (good cash flow, low EV/EBIT, low P/BV, good dividend, etc)... Note that I never mention about PE as i think EV/EBIT is much better to use than PE ratio as it takes into account of net cash & debt... even for net cash company like RGB, the EV/EBIT is still not low... do your maths yourself and you will find out...
many experts here claimed they are better than KC Chong.. that is funny.. haha... does KC Chong use EV/EBIT or EV/EBITDA a lot? the answer is definitely yes... so you guys are smarter than KC Chong sifu in terms of calculating intrinsic value...
P/BV & EV/EBIT are good methods to know if a share price is overvalued or not.. i agree that cash flow, dividends and growth are important too.. did i say they are not important? they are equally important.. but what I wanted to say is, I prefer to look for shares that fulfill as many criteria as possible (good cash flow, low EV/EBIT, low P/BV, good dividend, etc)...
================================================================== 1) I want to ask you what share fulfil your above all criteria? 2) Your sell call is just because EV/EBIT and P/BV no fulfil? If that is the story, you are based on EV/EBIT and P/BV to decide your investment. And seems like all math teacher is super investors. Hihi......
hi dudu, investment is a combination of sciences (maths) and art (judgement)... a maths teacher without proper judgment may not be a successful investor.
Did i call for a "sell". No, i did not. Perhaps the share price still has some more room to grow. Just that I would not recommend others to blindly buy at current price. I think that the upside is limited but the downside has higher risk... just that...
I don't know who is KC Chong. But I know investment is not only mathematic. I share my sifu investment philosophy as below , no difficult mathematic, simple calculations, but can do successfully in share market. But can you?
冷眼先生选股精髓就在以下。这已经排除了NTA。
G – Growth 成长 D – Dividend 股息 P – Price (PER) 价值 P – Profit 盈利 R – ROE 股东回酬 C – Cash Flow 营运现金流
Give you this baby..... “复杂的事简单做,简单的事正确做,正确的事常常做。”
iloveshare 128, I am so curious to know what share worth to buy now? And what share you have in hand? Do you mind to share? Then I will know better your position.
Perhaps the share price still has some more room to grow. Just that I would not recommend others to blindly buy at current price. I think that the upside is limited but the downside has higher risk... just that...
sound like a gambler for me, 70% open big 30% open small after continuously 3 times open small...
Sifu's big theory very geng but don't understand la ... I only know that, Tony bought Airasia for RM1 n now worth billions ... MAS used to worth billions but shareholders all pokgai now ... cheers ...
dudu, we are talking about RGB here so I am not going to talk about other shares here... since you cannot accept my opinions with open mind, I will stop here... i hope you and the rest have a successful investment in RGB. Thank you
Iloveshare128, of couse i won't talk about others share here. We can talk the share you recommend in that particular share platform. Show us your opinions is working and convince us to accept? We even don't know who you are and you didn't even recommend a single good share for us.
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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....
GoodBoy
6,594 posts
Posted by GoodBoy > 2016-11-01 17:23 | Report Abuse
After some profit taking could see price go higher .... cheers ....