Tuesday, November 24, 2015

CWT Limited

This post was sparked by a post on valuebuddies.

The post was

"Well, wasn't CWT around 1.50-1.60 two months ago? And its chairman have heavily bought its shares at around 1.50-1.60. 

Since the chairman will know more about CWT than most people, I can just follow him and start adding at 1.50-1.60 and below. No need to think so much."

I wanted to examine whether this is the case.

Here is a look at all the insider transactions in CWT Ltd in 2015


DateTimeCompany NameSecurity NameAnnouncement Title
14 Apr 201506:50:01 PMCWT LIMITEDCWT LIMITEDDisclosure of Interest/ Changes in Interest of Director/ Chief Executive Officer::DISCLOSURE OF INTEREST/ CHANGES IN INTEREST OF DIRECTOR
14 Apr 201506:48:02 PMCWT LIMITEDCWT LIMITEDDisclosure of Interest/ Changes in Interest of Substantial Shareholder(s)/ Unitholder(s)::DISCLOSURE OF INTEREST/ CHANGES IN INTEREST OF SUBSTANTIAL SHAREHOLDER
02 Apr 201506:17:35 PMCWT LIMITEDCWT LIMITEDDisclosure of Interest/ Changes in Interest of Director/ Chief Executive Officer::DISCLOSURE OF INTEREST/ CHANGES IN INTEREST OF DIRECTOR
02 Apr 201506:15:18 PMCWT LIMITEDCWT LIMITEDDisclosure of Interest/ Changes in Interest of Substantial Shareholder(s)/ Unitholder(s)::DISCLOSURE OF INTEREST/ CHANGES IN INTEREST OF SUBSTANTIAL SHAREHOLDER(S)
01 Apr 201505:56:05 PMCWT LIMITEDCWT LIMITEDDisclosure of Interest/ Changes in Interest of Director/ Chief Executive Officer::DISCLOSURE OF INTEREST/ CHANGES IN INTEREST OF DIRECTOR
01 Apr 201505:52:27 PMCWT LIMITEDCWT LIMITEDDisclosure of Interest/ Changes in Interest of Substantial Shareholder(s)/ Unitholder(s)::DISCLOSURE OF INTEREST/ CHANGES IN INTEREST OF SUBSTANTIAL SHAREHOLDER(S)/ UNITHOLDER(S)
13 Mar 201505:42:55 PMCWT LIMITEDCWT LIMITEDREPL::Disclosure of Interest/ Changes in Interest of Substantial Shareholder(s)/ Unitholder(s)::Disclosure of Interest/ Changes in Interest of Director/ Chief Executive Officer
13 Mar 201505:38:01 PMCWT LIMITEDCWT LIMITEDDisclosure of Interest/ Changes in Interest of Director/ Chief Executive Officer::Disclosure of Interest/ Changes in Interest of Director/ Chief Executive Officer
13 Mar 201505:35:03 PMCWT LIMITEDCWT LIMITEDDisclosure of Interest/ Changes in Interest of Substantial Shareholder(s)/ Unitholder(s)::Disclosure of Interest/ Changes in Interest of Director/ Chief Executive Officer
11 Mar 201505:15:01 PMCWT LIMITEDCWT LIMITEDDisclosure of Interest/ Changes in Interest of Director/ Chief Executive Officer::Disclosure of Interest/ Change in Interest of Director/ Chief Executive Officer
24 Feb 201506:02:32 PMCWT LIMITEDCWT LIMITEDDisclosure of Interest/ Changes in Interest of Director/ Chief Executive Officer::DISCLOSURE OF INTEREST/ CHANGES IN INTEREST OF DIRECTOR


You will see that the transactions happened between Feb-April 2015.

Now, here is a look at the prices in terms of charts.


The first big purchase was on Feb 24 at 1.615 per share.

Similarly, the next big purchase was on March 11 at 1.54 per share.



Also, there was a big buy in April at 1.605 per share



A simple strategy which is what the comment  had alluded to, i.e. follow the chairman, would have paid off in the form of roughly a 20% return on capital assuming one bought at SGD 1.61 and sold today at 1.92 SGD.

As one can see, the share price is trending down. Hence, there may be some chance of the Chairman deploying his war-chest to scoop up some more shares.

However, it looks like 1.5-1.6$ is where he sees value.

Full Disclosure : I will be keeping an eye out for any insider transaction in CWT Ltd and deploying some cash to piggy-back


Disclaimer :- 

I am not an investment professional.

I encourage you to do your own independent "due diligence" on any idea that I write about, because I could be and probably am wrong.

Nothing written here is an invitation to buy or sell any particular stock.

At most, I am handing out an educated guess as to what the markets may do.

The market will always find a new way to make a fool out of me (and maybe, even you!).

Even the best strategies of the past fail, sometimes spectacularly, when you least expect it.

I am not immune to that, so please understand that any past success of mine will probably be followed by failures

Thursday, October 1, 2015

Metro Holdings - Will (Recent) History Repeat in 2016?



This post is to outline a trading idea on Metro Holdings Ltd (M01.SI on Yahoo Finance)

Here below is a look at Metro over the trailing one year.



Now, take a look at the year before that i.e. from 2013 to 2014.



You might say, what is the similarity, because the charts look different, well yes and no.

They are similar as the trend is broadly up from Oct to Jun/Jul and then it crashes down.

Did this occur from 2012 to 2013?



The answer is a resounding yes.

It is either fast and furious or slow and steady, but history suggests that it will crash to at best a low of between 0.8 - 0.85 cents in the rest of the year and rise to around 1 by Jul 2016.

The trading idea is

a) Buy if and when when it falls to below 85 cents before end Nov.
b) Sell when it reaches $1.

Without trading friction, that is a return of 18% for a holding period of around 8 months.

Full Disclosure : I intend to buy a position in Metro when it hits below 85 cents and will likely trade out when it hits $1.

Disclaimer :- 

I am not an investment professional.

I encourage you to do your own independent "due diligence" on any idea that I write about, because I could be and probably am wrong.

Nothing written here is an invitation to buy or sell any particular stock.

At most, I am handing out an educated guess as to what the markets may do.

The market will always find a new way to make a fool out of me (and maybe, even you!).

Even the best strategies of the past fail, sometimes spectacularly, when you least expect it.

I am not immune to that, so please understand that any past success of mine will probably be followed by failures

Wednesday, September 30, 2015

A Low Enterprise Value EBITDA Portfolio for Singapore - Performance Update

I had done a post on a low enterprise value ebitda portfolio for Singapore.


Details are there at this link


The original investment hypothesis was that

a) This portfolio will outperform the market
b) It will exhibit lower volatility and draw-down.

Looking at the volatility in the market, I wanted to check how this portfolio is holding up.

The portfolio is amazing as it significantly outperforms and shows lower volatility and lower draw-down.


It is amazingly up, 1.38%, while the benchmark STI ETF is down 17%.

That is 18% out-performance in the last 8 months.

Full Disclosure : I own positions in BRC, CDW, Keong Hong, Lee Metal, Nam Lee and PEC.

Disclaimer :- 

I am not an investment professional.

I encourage you to do your own independent "due diligence" on any idea that I write about, because I could be and probably am wrong.

Nothing written here is an invitation to buy or sell any particular stock.

At most, I am handing out an educated guess as to what the markets may do.

The market will always find a new way to make a fool out of me (and maybe, even you!).

Even the best strategies of the past fail, sometimes spectacularly, when you least expect it.

I am not immune to that, so please understand that any past success of mine will probably be followed by failures

Tuesday, September 29, 2015

Asian Pay TV Trust - Catching The Top



I initially looked at APTV (S7OU.SI) when I was screening for investment opportunities in April 2015.

The investment thesis was

a) This is a defensive investment
b) One gets dividend income
c) The counter is on a steady uptrend, which is juiced by the quarterly dividend

A good link to explain the investment thesis backing the uptrend was this investopedia article.

Buying When Stocks are above Moving Average

Here is a look at the stock chart for the year leading up to April 24, 2015



In terms of dividends, the trend is below


ASIAN PAY TELEVISION TRUSTDIVIDEND18 Mar 201520 Mar 201527 Mar 2015011014 - 311214 SGD 0.0213 TAX EXEMPT
ASIAN PAY TELEVISION TRUSTDIVIDEND10 Dec 201412 Dec 201419 Dec 2014010714 - 300914 SGD 0.02 TAX EXEMPT
ASIAN PAY TELEVISION TRUSTDIVIDEND17 Sep 201419 Sep 201426 Sep 2014010114 - 300614 SGD 0.0412 TAX EXEMPT
ASIAN PAY TELEVISION TRUSTDIVIDEND19 Mar 201421 Mar 201428 Mar 2014010713 - 311213 SGD 0.0413 TAX EXEMPT
ASIAN PAY TELEVISION TRUSTDIVIDEND23 Aug 201327 Aug 201324 Sep 2013290513 - 300613 SGD 0.048 TAX EXEMPT
As you can see from the dividend table, slight change in dividend from half yearly to quarterly, more or less similar dividends for trailing two quarters as for previous half year.

What could go wrong?

In one word, a lot. (Okay, that's two words!)

Here is a chart of the performance from then till date.


 
In short, it is a 14% decline in prices since entry.

What about the dividends?

Well they have declined, as well, by 6%.


TypeEx-DateRecord DateDate Paid/PayableParticulars
ASIAN PAY TELEVISION TRUSTDIVIDEND15 Sep 201517 Sep 201525 Sep 2015010415 - 300615 SGD 0.02 TAX EXEMPT
ASIAN PAY TELEVISION TRUSTDIVIDEND17 Jun 201519 Jun 201526 Jun 2015010115 - 310315 SGD 0.02 TAX EXEMPT

The question now is whether to average down.

The hypothesis if you look at the long term chart (below) is that 



APTV Trust ranges from 0.75 to 0.91 and buying around now will give one an opportunity to exit at around 0.91, if history is any guide.

If you look at the additional two pictures.



We do seem to be in the opportunity curve, however, chances are a lower low is needed before entry.

Another way to look at it is



Buy now and sell when it reaches a higher high.

However, as I see it, this investment has breached my investment expectation.

Adding on more to it is a case of Sunk Cost Fallacy

There is no need to sell as I do not really need to sell.

However, there is no need to add to the counter / average down.

Full Disclosure : I own a small position and am likely to exit when the position reverts to break-even

Disclaimer :- 

I am not an investment professional.

I encourage you to do your own independent "due diligence" on any idea that I write about, because I could be and probably am wrong.

Nothing written here is an invitation to buy or sell any particular stock.

At most, I am handing out an educated guess as to what the markets may do.

The market will always find a new way to make a fool out of me (and maybe, even you!).

Even the best strategies of the past fail, sometimes spectacularly, when you least expect it.

I am not immune to that, so please understand that any past success of mine will probably be followed by failures



Yanlord Land : An Evaluation after a year

I had posted about Yanlord a year back.

Old Post on Yanlord

The summary is

"This essentially means that the value for Yanlord Land is pessimistically 76 cents and optimistically 144 cents. The upside potential seems to be 24% and the downside risk seems to be 35%."

Looking back at the performance over the period from my post till date, one can see that if anything the downside was only till 90 cents and the upside was 130 cents.




Chances are this will serve a position in the portfolio where are investing in a hated sector i.e. Property in China is being cooled, no point investing, so, you are taking a contrarian approach.

The bull thesis is that, all you need is for majority share shareholders to privatize this and pay out a small premium to traded price of say 20% and you have made your 20%.

One can take a patient approach and wait for the counter to hit 90 cents anytime from now till March 2016.

There is likely to be a run up in April or May 2016 at which time one has an exit price of say $1.2.

As always, I will evaluate this in a year's time.

Full Disclosure : I have no position in this stock and I may initiate one, since i do not have a Y counter.

Disclaimer :- 

I am not an investment professional.

I encourage you to do your own independent "due diligence" on any idea that I write about, because I could be and probably am wrong.

Nothing written here is an invitation to buy or sell any particular stock.

At most, I am handing out an educated guess as to what the markets may do.

The market will always find a new way to make a fool out of me (and maybe, even you!).

Even the best strategies of the past fail, sometimes spectacularly, when you least expect it.

I am not immune to that, so please understand that any past success of mine will probably be followed by failures

Wednesday, September 16, 2015

A look back at Nam Lee

I had posted about Nam Lee last year.


Is this an investment blog or a fitness post might be your take?

On that day, the big news was Defence Minister says IPPT to be reduced

An attempt at levity, to get you to relax and read this post.

To read up more on Nam Lee, it would be a good idea to refresh your memory with this link below.

Old Post on Nam Lee

One key element in my entry point was that it does not seem like there is much room to fall further.

Here is a look at Nam Lee from then till now.



That part was more or less true as Nam Lee did not really fall by much from 29 cents.

From 29 cents, it is now at 28 cents, which in the context of the overall crash and correction seen in the STI, is not much, as you can see from the chart below.



So, in that sense a good defensive stock, plus you would have made up the one cent fall in dividend which they paid out this year.

In the last post, the key statistics showed a low EV/EBITDA.

Market Cap (intraday)5:69.97M
Enterprise Value (Jul 23, 2014)3:44.05M
Trailing P/E (ttm, intraday):10.36
Forward P/E (fye Sep 30, 2015)1:N/A
PEG Ratio (5 yr expected)1:N/A
Price/Sales (ttm):0.41
Price/Book (mrq):0.61
Enterprise Value/Revenue (ttm)3:0.26
Enterprise Value/EBITDA (ttm)6:4.53

If at all anything, it has gotten cheaper since then.

Valuation Measures 
Market Cap (intraday)5:68.76M
Enterprise Value (16 Sep, 2015)3:48.29M
Trailing P/E (ttm, intraday):6.79
Forward P/E (fye 30 Sep, 2016)1:N/A
PEG Ratio (5 yr expected)1:N/A
Price/Sales (ttm):0.46
Price/Book (mrq):0.57
Enterprise Value/Revenue (ttm)3:0.32
Enterprise Value/EBITDA (ttm)6:2.75

And in a way, it has become at least 39% cheaper in terms of the value placed against its shares.

My original position is valid and I am still long.

IMHO, it is worth adding to this as the stock has got appreciably more valuable by close to 40% and the market has not appreciated it.

Compared to the STI, it is likely to provide better returns as it has become more valuable as a company.

Secondly, my hypothesis is that the market will slowly start appreciating the additional value created and mean reversion itself will take the stock up by at least 15-20%.

Lastly, the downside is limited.

As always, only time will tell on whether this is the correct decision.

The way to examine this is as follows:-

a) Does Nam Lee continue to provide better risk adjusted returns than the STI in the coming year ?
b) Does the stock appreciate by at least 15% in the coming year?

 Disclaimer :- 

I am not an investment professional.
I encourage you to do your own independent "due diligence" on any idea that I write about, because I could be and probably am wrong.
Nothing written here is an invitation to buy or sell any particular stock.
At most, I am handing out an educated guess as to what the markets may do.
The market will always find a new way to make a fool out of me (and maybe, even you!).
Even the best strategies of the past fail, sometimes spectacularly, when you least expect it.
I am not immune to that, so please understand that any past success of mine will probably be followed by failures

Monday, September 14, 2015

Overhead Supply

This post was inspired by an article in TRB.

Josh on Overhead Supply


Chances are one is going to hear this term from Technical analysts over the coming year in Singapore.

If you want a quick primer on this, please go to this link.


"Okay, good picture, nice trivia, so what does it mean for me in Singapore?" is what I hear you thinking.

Here is a look at the STI over the last one year.


The overhead supply for the STI is in the 3280-3300 range.

Essentially, what it means is that anyone who has been long stocks will get to break-even when the STI reaches 3,300.

Now, 3300 level is about 15% higher from here.

However, as we all know, markets do not shoot up , they tend to grind up.

The overhead supply will ensure that this grind is a long, slow one.

In short, markets are likely to go nowhere very fast in the coming year or so.

The prediction is that 

a) the STI will bounce around in a range between 2,700 to 3,000 in the coming year
b) Every bounce will meet overhead supply and fade
c) Every dip will meet bargain-seekers, average down candidates and fade
d) Good entry points will be around 2,700 and exit points will be around 3,000
e) A tighter one will be to buy the dip to 2,800 and sell the bounce at 2,900
f) If you are using the STI ETF, buy when it drops below 2.85 and sell when it reaches 2.95


The way to examine this is as follows:-

a) Does the STI remain range-bound between 2,700 to 3,000 in the coming year?
b) How many round trips can one make in the coming year, buying STI ETF at 2.85 and selling at 2..95?

As usual, I will do a review in a year on this idea.
 Disclaimer :- 

I am not an investment professional.
I encourage you to do your own independent "due diligence" on any idea that I write about, because I could be and probably am wrong.
Nothing written here is an invitation to buy or sell any particular stock.
At most, I am handing out an educated guess as to what the markets may do.
The market will always find a new way to make a fool out of me (and maybe, even you!).
Even the best strategies of the past fail, sometimes spectacularly, when you least expect it.
I am not immune to that, so please understand that any past success of mine will probably be followed by failures