Friday, December 03, 2010
Jerneh- should we worry about the PN17 classification?
Jerneh is considered "an affected listed issuer pursuant to PN17 of the Listing Requirements whereby a listed issuer has suspended or ceased its major business or operations as a result of the disposal of the listed issuer’s major business" (here). As you are well aware Jerneh has disposed off its major business- the insurance business- for RM523.2 million (here). What's Jerneh's plan for the future? Capital repayment or new business injection? If it's the latter, what is this new business? Would Jerneh remain in the Robert Kuok group? All these uncertainties are weighing on the share price and some investors have decided to cash out & look for other stocks to invest in. However I do not believe that you should just dump this stock because of the PN17 classification as Jerneh is well-backed by good assets & it is still a part of the well-managed Robert Kuok group.
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32 comments:
Jerneh hold a lot of cash after sell off the insurance asset. But what will be the next? hm.. mr robert sure have his idea...
fund manager not allow to invest and must divest if a share fall under pn17? no wonder the jerneh share plundge today
any idea on GENM, base on TA?
looking support at 3.20 , and rebounding now.
your view on Bursa...? The stock seems to get bashed faster than the index... however, trading volume seems to be increasing on month to month basis...
Hi Alex :
May u commend on kstar ( Chinese IPO ) which is heading southwards each day n not seeing any rebound . Techically , is it sound to purchase at the prevailing cheap price offered?
Alex, thanks for sharing ur comments- informative & helpful. Any comment on TDM (RM2.54) & Kfima (RM1.33)- Buy/Hold/Sell now? Tq.
Any idea on tdm & kfima? Tq.
Hi st
Both TDM & Kfima have run up a lot over the past 2 years. While there is no sign of a top yet, these stocks are pushing against strong resistance- RM2.50-2.60 for TDM & RM1.40-1.50 for Kfima. If TDM can surge past this level it may test the RM3.00 psychological level & possibly its all-time high at RM3.80. For Kfima, the next resistance is at RM1.80-2.00.
The chance of both stocks breaking above their immediate resistance is fairly good given amble liquidity & good financial performance recorded by TDM & Kfima. For the 9 months ended 30/9/2010, TDM's net profit increased from RM33.5 mil to RM60.4 mil while turnover increased from RM238 mil to RM285 mil. For the 6 months ended 30/9/2010, KFima's net profit increased from RM28.3 mil to RM32.2 mil while turnover increased from RM188 mil to RM217 mil. Based on annualized earning, TDM & KFima are trading at current PE of 6.9 times & 5.5 times respectively- which are not demanding.
Based on undemanding valuation, these stocks may still continue to rise further.
Hi ayseng
kstar looks like a stock played up by a syndicate pool. If you are in the pool, would you still play up this stock? Why would you do it again?
After every play, a stock would have a large pool of trapped punters or "forced investors". They may not sell after the initial drop because they were still in denial. After a long & protracted decline, the stale bulls would become more realistic & some would capitulate (or give up). Every effort to push up would be short-lived, unsuccessful & futile. The stock would only recover if sufficient stale bulls have exited or a strong fundamental reason is found to reverse the market psychology. Until then, the stock will languish in the graveyard of played-up stocks.
I think it's best that you avoid this stock.
Hi hkloon
Bursa makes about 5 sen per quarter or 20 sen per annum. At the present price of RM7.99, Bursa is trading at a PE of 40 times. If more products are introduced to the market, the earning may increase. Nevertheless, the bread & butter is pretty the trading on Bursa & that would remain unchanged. As such, Bursa is richly valued at the present price level.
Chartwise, Bursa is now testing the RM8.00 psychological level. A break below this level could send the stock to the next strong horizontal support at RM7.80 and then at RM7.50 & RM6.80.
Based on the above, it is difficult to make a case for buying this stock.
Hi Ivan
GENM is now rebounding after having made a temporary bottom at RM3.19-3.20 at the end of November. Its resistance levels are at RM3.40, RM3.50 & RM3.60. Meanwhile its support are at RM3.20, RM3.10 & RM3.00.
The stock is unexciting from the technical perspective & the market action seen so far. However, the fundamental aspect is fair good & its valuation is quite undemanding. Juxtaposed against Genting SP's Ferrari, GenM's steady performance looks like a Mercedes. It's reliable, comfortable & good value for money.
HI Alex good morning, if possible and time permits, could you do a posting on Xinquan ? thanks, jackie
Mrg Alex, thanks for the idea given on GENM :) ..hopefully it can fly ahead 3.40 and 3.50 soon.
a) Year end - plp visit genting
b) CNY coming - plp go casino
hopefully the coming 4Q 2010 income quarter can impress investor. BY the way, do GENM still holding cash RM 5b? Will they have a special dividend pay back to investor?
Alex,
Whats your opinion on FREIGHT?
Hi Alex
Any news on KSL? It opened up with a gap today. Is it considered breakout?
hi Alex,
could you pls comment on rcecap? noticed sudden drop despite great quarterly results.
thanks
maxwealth88
Tamco 0048 got suspended for months because PN17 and still no plan to get new business.
For Jerneh, some afraid they use the cash to pay new business at high price.
Other counters like Airasia or Genting Singapore, some brokers say buy, some say sell. Freight is one of the only few counters that alomost all brokers make BUY call. Low PE with decent dividend and growth. On target to achive 7 consecutive years of profit increase.
Hi Alex
How do you see Careplus ?
Thanks Alex, for valuable infomation. On Maybank DRP, Jerneh PN17, counter fundamental and technical analysis with conclusion and recommendation, and overall market comment. Many thanks
hi alex. please comment on ABRIC which break 5 years high. what is target price ??
Hi ,Good Day
Mr Alex
The Revenue of Xin Quan was 160 mil profit of 3rd qtr 25.8 mil comparing with(Xi De Lang Revenue= 125 mil profit of 3rd qtr 21.9 mil) and XDL is giving Dividend , is that mean to buy xin quan i better buy in XDL ? your opinion please ? and how do you think about the Careplus(0163) that listed on the ace market on monday ? Much much appreciate for the advice ...
Thanks
Nian
Hi Alex
Can You comment on HDBS. I understand there are some merger.Thanks
Hi duran
I did not hear anything on HDBS. It is a very well-managed company. For FYJuly 2010, it reported a net profit of RM61 million on the back of a turnover of RM347 million. This is a big jump over last year's performance where it reported a net profit of RM31 million & a turnover of RM296 million.
Chartwise, it has risen from RM1.60 to the current price of RM2.40 over the past 3 months. It broke above the horizontal line RM2.35 and it may test the next resistance at RM2.65 and thereafter RM2.75. On weakness, it may slide back to RM2.35 and then RM2.25.
Good day Alex,
GENM has hit broke the resistence level jo- RM3.40 .
Will it go higher tomorrow?
Hi Chee Nian & jackie
I noticed that the recent run-up in the prices for Xin Quan, Xi De Lang and a few other PRC-based stocks seems to frizzle out once Shanghai stock market started to rally in September. Why did they not continue to rally along with the rise in SSEC? Of course, we cannot assume the opposite would happen now that the SSEC has weakened.
PRC companies are a unique group of stock. I believe investors are very wary of them. The sharp rally in Kstar & its subsequent plunge may reinforce the perception that these stocks are nothing but playthings.
You made a point about buying these stocks for dividend. On paper, it looks good. After all, they reported substantial profit & they could pay out good dividend. Nevertheless, you need to monitor their share price closely for signs of trouble. Study their quarterly results diligently for anomalies, such as high debtors figure, etc.
As for Careplus, I am not keen on it. It is a very small player in the rubber glove sector. The sector seems to be entering into a period of consolidation & the better stocks to invest in are the bigger companies, such as Topglov, Harta, Kossan or Supermx.
Hi wong
ABRIC broke through some many resistance level to hit an intra-day high of RM0.43- a strong horizontal resistance. If it can surpass this level, it may go to RM0.47. After a long rally, Abric may take a breather. It may pull back to RM0.40 or RM0.39 for a short correction.
Abric's financial performance has improved for the 9-month ended 30/9/2010. It reported a net profit of RM4.7 million on a turnover of RM48 million. Annualized EPS for FY2010 is about 6.3 sen. This means the stock is now trading at a PE of 6.3 times. For a smallcap, that's a fair multiple to pay.
Hi Polite Market
Thank you for sharing.
Hi MaxWealth88
RCECap broke its psychological RM0.60 as well as the horizontal support at RM0.55-0.56.
I am not sure what's the problem. It may be related to some recent reports about Government tightening up on rules for civil servants' personal borrowings. This problem has been discussed before & it is quite serious. The huge borrowings of civil servants is counter-productive & the government is partly to be blamed as it has facilitated the repayment of these loans by monthly deduction. This makes the loans almost similar to a loan to the Government. The only way the repayment would stop is when the civil servant died or was sacked. To mitigate the first scenario, the lenders forced the civil servant to take a MRTA. The sacking of civil servant hardly ever happens in Malaysia. Because of these infrastructure, loans to civil servant has grown by leaps & bounds. A tightening of the rules may see a sharp drop in the top-line & bottom-line for RCECap, MBSB & BIMB.
Hi WK
FREIGHT has been consolidating in a triangle since August. If it can break above the RM1.00, it would continue on its prior uptrend. On the other hand, if it break below RM0.93, it would enter into a bearish phase.
Go to Bursa to check on its results.
Hi JY
KSL seems to be moving in an imperfect upward channel, with support at RM1.50 & resistance at RM1.80. Within this channel, the share price gaped up on Monday (Dec 6). The gap is at RM1.67-1.69 and the volume is fairly significant.
A gap means a sudden & significant shift in outlook. It is also a good support level in the event of a pullback. You can consider buying near the gap & sell at the resistance from the upper boundary of the channel at RM1.80. However, the market action for KSL today does not seem to reflect the excitement of Dec 6 (when the gap occurred). What happened on Dec 6? It is fully factored into the price?
Hi Ivan
Will GenM pay a special dividend? Investors have been asking the same question for the past few years. With the acquisition of the UK casinos and the new venture in new York, I doubt GenM will be paying any special dividend this year or next year.
Alex,
Results ok... profit slowly expanding.... but low liquidity lahhh... dividend 5c / yr
Hi Alex,
You said "However, the market action for KSL today does not seem to reflect the excitement of Dec 6 (when the gap occurred). What happened on Dec 6? It is fully factored into the price?"
To answer your question, it is because Dali (another famous forumer, you should know right?) promoted this stock on Dec 3 (Friday), so this stock rally on Monday (Dec 6). Meaning, speculations.
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