analysis indicates that every 10 sen appreciation in ringgit against the US$ will decrease Hevea’s profit by 11% assuming a constant ASP. By HL Reseach
Paktua73, if you keep on buying in order to average down your cost, sooner you will become a substantial shareholder. Later you will have to issue offer letter to buy all the balance of that you do not own. Hahaha
Last qr profit dropped 58%, next qr will be worse with Ringgit dropped even lower now. There is a possibility it will incur losses next quarter so not a good time to hold. If losses is reported, get ready for it to drop further.
@saltedfish, not all people who bought this counter past 12 months lose big time. OK? Remember Specter? Your 'buddy', I think he made handsome profit from this counter.
Posted by grong > Jan 27, 2018 09:36 AM | Report Abuse
Should I keep or Cut? Confuse...
This is a very good question. They ride on the appreciation of USD which i think is luck. They manage to generate cash due to sudden higher surplus of ringgit. The USD keep strengthening, translate to higher and higher cashflow which enables them to pay off debt and translate them into net cash company.
But. What if it's the other way around? Their cost is in RM whereas they get paid in USD. Unless they have a way to hedge against currency risk which i think they are very vulnerable to. Their turnover is just going to get eaten slowly and slowly until it's not a profitable business anymore.
Hevea survivability will depends highly on how the management transfer the cost to their client.
run first guys, even EPF buying does not indicate any signal. Some more, MYR is keep on appreciate and this will erode profit, affect dividend as well. Re enter when the USD appreciate is better
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....
free2invest
1,748 posts
Posted by free2invest > 2018-01-25 14:11 | Report Abuse
USD vs MYR achieved new low 3.89 since two years ago.
Heveaboard share price also achieved new low 1.05 since two years ago.
What's a correlation!