Chart: Evergreen's weekly chart as at Nov 9, 2010 (Source: Quickcharts)
However, Evergreen's financial performance is quite commendable. For 1H2010 ended 30/6/2010, it recorded a net profit of RM69.6 million on turnover of RM480 million. This compared favorably to the same period last year when its net profit was RM14.9 million & turnover was RM335 million. Its financial position is also healthy with current ratio at 1.53 times & debts to equity at 0.5 time.
Based on bearish technical outlook, it is advisable to avoid Evergreen until the technical picture has improved.
Alex, the reason I like your blog is because as a technician, you also look at FA. You have rightly described the good fundamental of Evergreen; 69.6 m profit half year when annualized gives an earnings per share of 27 sen. With the present price of Evergreen at 1.40, it is selling at a per of only 5. Credible management, good earnings growth, healthy balance sheet and a good FCF of more than 100m last year. But when your chart contradicts with the fundamental, you prefer the signal given by the chart. This is something I cannot understand chartist; why choose the senseless historical chart over the scientific fundamental approach?
ReplyDeleteAllow me to be an intruder, fundamentally it is a good stock, but timing may not be right as shown on chart, cause it could be going lower notwithstanding good fundamental
ReplyDeleteWake up alex wake up, read what ta player talked about ta in sifu sam's private blog>>
ReplyDeleteSamgoss said...
Another smart guy like ck5354, he came from hell n now in heaven , read his posting in my private blog :-
Comment In Response To
Author Comment In Response To
KCW
cwei_XXXXX@yahoo.com
60.53.203.96
Submitted on 2010/11/10 at 10:50pm
I have been involved in share trading for almost two years…before entered the market i read through some books & all were talking about TA…intially i found it quite interesting.. but after some thoughts & some “home works” i feel that TA is quite logical but not practicable as i am working in accounting & finance field for more than 10 years..i strongly agree that FA will be more practicable when come to decide WHAT & WHEN to buy..
I discovered sam’s blog since day one i started trading in share market & i would say i learn quite a lot from him..but i stop reading his blog when he started his private blog..the reason was i felt that USD38 is too expensive..
I just registered as his private blog member .. why? because 70% of the shares i bought and made profit in these two years were Sam’s call..and the money i made based on his call allowed me to renew the membership for more than 400 years…so i will be feeling bad if i didnt contribute & be part of the “motivation” for Sam to continue digging some gem for us…
haha.. ok ok.. forget about the feeling bad excuse…in fact i am too rich now to pay that SUP SUP SUI USD38 per year which will be saving me a lot of time on picking which stock to keep an eye..
I feel that Sam deserve a THANK YOU VERY MUCH from all of us..
www.samgnag.blogspot.com
Hi KC,
ReplyDelete"... Why choose the senseless historical chart over the scientific fundamental approach?"
I remember reading about technical analysis when I studied Financial Management for my Professional Exam. The FM book was more than 500 pages but the space allotted to TA was only 2 pages. Without going into the principles & psychology behind TA, a reader was quickly introduced to Head-&-Shoulder reversal pattern. I laughed at the silliness of the whole topic of TA then but I don't laugh it now. After years of further learning & observation, I come to a better understanding of TA. Today I believe that TA is not inferior to Fundamental Analysis. Ta is very essential for traders & a good companion for investors. You can choose to ignore TA if you so decide but don't be like some who choose to belittle or shout down at those follow TA.
Have a nice day.
Hi Alex!
ReplyDeleteI can suggest that you stop putting Neno's comments in this blog because he is so irritating.
Hi Alex, thanks for your response. I have to admit that I do criticize TA sometimes especially when some friends of mine tell me that it is useless for me to do all those tedious FA and that their TA is the one to follow. I also have to admit that my knowledge of TA is minimal and limited to what what I have read about academicians research (not done by me) that TA has no value after taken transaction cost into considerations. Well, I guess I am not in a position to argue with you (I do not have intention to)about TA and FA as you are a qualified finance professional. Moreover you are all the time in this industry. We all know even experts from both sides are still arguing about it. Neno has a valid argument about his latest posting on Evergreen. I strongly not agreeing to Khoo that his latest type of comment should be censured. Allow for dissenting point of view. We can all learn from each other, besides hoping to make some money in the market. Only that criticism has to be constructive, and not personal.
ReplyDeleteHi limko
ReplyDeleteEvergreen has had a good rally today. A good level to sell into strength is the 50 & 200-day SMA lines at RM1.53-1.55.
I have learned today that the Thai producers of MDF & Particle Board are expanding aggressively again. We all know that a similar reckless expansion 3-4 years ago caused a massive capacity overhang that has yet to be fully digested. The market is probably concerned that this new round of expansion would end up just as bad as the last one. You may call this the wisdom of the crowd or looking at the tea leaves in the chart. I leave it to the readers to decide.