1) Future Wealth is represented by a young graduate fresh from School. Usually a young man in his mid twenties.
He is still young and yet to buy his own house. He might own an affordable car or just a motorbike.
What has he got? HE HAS HOPE. HE IS FULL OF DETERMINATION TO SUCCEED & FULL OF IDEAS!! But he has yet to make any real monies. His Wealth is Yet in The Future!
This is represented by a very young company. Management is full of ideas, ventures & mergers. Full of energy & hope. Lots of enthusiasm during IPO. See how many write up to promote this newly listed company. Gullible people are chasing. But the stock is yet untested. Business yet to prove itself. All hype and hope for Wealth still in the future!
Calvin rarely invest in this type of company. Better avoid.
Why avoid?
See this
Most Start-up Businesses Fail in the First Five Years, Myth or Reality? Starting up a new business is proving to be a hard task for most of the entrepreneurs across the business world. The rate of failure within the first five years of business operations is still debatable and is said to be different from one economic zone to another. This is said to be depending on the various internal and external environmental forces operating in different industries. According to Griffith (2014), he postulates that over 60% to 70% of start-ups cannot survive beyond their first five years. Yes! More than 50% of all new businesses will fail within the 1st five years That is why Calvin generally avoid buying new unproven stocks. I need at least 3 years after listing to read its yearly Annual Reports before buying. Or else wait or give it a pass. In real life Established Companies will only look for qualified workers with proven experience & skill with real results or testimonies of good performance from his previous companies. They don't hire you by what you claim. They only hire proven results from skill & qualifications
2) Present Wealth.
Represented by Growing Companies with Proven Income. Usually healthy PRESENT Growth that is visible. This is like a mature man in his 30s to 40s. He has bought his house & car. But the bulk of his monies still invested in his growing business.
So his wealth is still being generated in the present.
This is popular growth stocks.
Calvin will buy some. On one condition. He looks for a fair price to enter. Best is during a market crash or overlooked by the market.
BUT CALVIN WON'T PAY A HIGH PRICE FOR THEM WHEN PRICES ARE INTO OVERVALUATION. IF YOU OVERPAY FOR ANYTHING. CHANCES ARE THEY WILL UNDERPERFORM THE MARKET FOR A LONG TIME TO COME LATER.
3) Past Wealth.
This is an old matured person in his 50s, 60s, 70s or even 80s
He once was a young graduate with Vision. He moved on to be a very successful businessman in his prime. So he has used his earnings to buy lots and lots of Assets like Lands, properties, warehouses, shophouses & other investments of Value. CASH OR EARNINGS CONVERTED TO REAL GOOD SOLID ASSETS - SO HIGH NTA REFLECTED IN BOOK VALUE.
As he is already old he slows down. He takes less risk. He looks for Capital Preservation First with a View to Growth. But usually things are more settled as he is no longer as hungry like he was as a fresh graduate once.
So I avoid buying stocks with "future growth" hype. Selectively buying Present Growth Stock if I SEE VALUE. And love buying into PAST WEALTH STOCKS OF IMMENSE VALUE SELLING AT DEEP DEEP DISCOUNT
I avoid the young man company with hope of future wealth. I will buy some (only selectively) the mature company of present wealth if they sell at reasonable prices. I concentrate on Deep Value Stocks of PAST ACCUMULATED WEALTH SELLING AT DEEP DISCOUNT
E.g. Accounting may require you to recognise an income this year, cos you EARNED it this year But under Income Tax rules, you will only be taxed when you receive payment (cash) for that
So you have a mismatch here
So let's say the income is 1m 24% tax is 240k
U pay no tax this year. Current tax = 0 But you need to recognise something called DEFERRED TAX = 240k So total tax expense this year is 0+240k=240k
Then next year u sold nothing, did absolutely nothing But you received that 1m cash
Current tax=240k (1m x 24%) Deferred tax (reversing the expense last year)=-240k Total tax expense this year=240k-240k=0
Complicated? That's why you need your accountants! 😁😂🤣
@Save to answer your question, JTiasa accounts this quarter have a deferred tax CREDIT. See the 2nd part of my example above. It's a REVERSAL credit/income
Taking out Income Tax Expense (Credit reversal) still very decent profit of more than 4 sen profit. annualised 16 sen and at 71 sen Jtiasa P/E only 4.43
Moreover, Its debts now pared down further from Rm200 millions only Rm93 millions
NAV (NTA) best
NTA up 12 sen from Rm1.31 to Rm1.43
A nice dividend (second interim) of 1.7 sen
Well done! Jtiasa!
Resounding Success!
Standing ovation!!
All round applause!!!
JAYA TIASA: THE MOST OUTSTANDING RESULTS OVERALL!!!
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....
calvintaneng
56,561 posts
Posted by calvintaneng > 2023-07-31 00:06 |
Post removed.Why?