USD uptrend again

Debt in USD = headache again
Sales in USD = additional gain

SCH - the change of wind

My 5 simple steps will lead me to simple but effective value investing. My way to minimise the risk and maximise the gain.

Step 1: Check the PNL. Profit? Potential turnaround to profit?

Aim the bull: SCH business is trading quarry machine and equipment. Last year due to stonger USD and GST impact, the sales seriously affected. However, the company still able to maintain profitable.

Score : 1 due to still profit despite business slow down.

Step 2: Check the cash flow. Where is the money generate? Where is the money go?

Aim the bull: Cash and debt about equally same. But still able to pay dividend.

Score: 0 due to not a net cash company.

Step 3: Check the Balance Sheet. Is it only left the shit (e.g debt)? Cash status? Retained earnings for potential bonus issue? NTA vs price? Fair value vs price vs NTA?

Aim the bull: Manageable debt but risk of cash flow if business continuely no improvement. High retain earning but partly offset by merger deficit.

Score: 0 risk of debt default if business continue slow down

Step 4: Check the price status? Which wave? Uptrend? Downtrend? Consolidation? At peak? Measurement of margin of safety?

Aim the bull: Price still at bottom level, no sign of recover. If you noticed the history movement, it will rebound after touching 0.20.

Score: 1 due to better margin of safety.

Step 5: How is the outlook of the existing business and any potential sales pipeline?

Aim the bull: Below is my outlook which will lead to better performance or turnaround:
1. Stronger MYR able to import machine and equipment at better price.
2. GST impact slowly realignment to demand.
3. Mega infrastructure projects kick off soon e.g. Pan Borneo and MRT 2 projects will lead to higher demand of capital and operating spending for quarry operators.

Score: 1 due to "wind will change"

If score 1 or 2 points...forget it
If score 3 points...monitor closely
If score 4 points...collect slowly
If score 5 points...full force...sai lang

Overall 3 points...the risk is the wind still stay no change i.e. USD continue rise up and slow implementation of the mega infrastructure project.

RGB - breaking the wall soon

Feeling the wall is going to break soon, may the force with u...

A&M - healthy correction; HIL - "heavy correction" with small volume

A&M - still within uptrend line.

HIL - Away from uptrend line, see whether it can restore back or not. The volume bring down the price very small, therefore it might be a wrong signal.

RGB - at where you look at it?

In the chart, there is a hidden or invisible line you need to feel for it. How to feel it is determine by at where you fee it. The line aim the bull described in 3 simple term.

1. Uptrend line (a buy )

2. Down trend line ( a sell )

3. Flat line ( monitor )

From the mountain (5 years chart), actually you can see RGB is moving at uptrend line with big swing gap. Now is at bottom 0.16. The next new high aim the bull forecasted above 0.20 - 0.25 as to move along the uptrend line, this has to be created. If not the uptrend line is game over. 

With recent good financial performance and expected coming good result, yes, my feeling it is will likely to happen. In term of margin of safety, yes, I am not buying at peak but at bottom as I feel.

If you standing on the ground (3 months chart), you will only see a piece of picture (a flat line movement) but not a full picture. Therefore, where is your standing to view is a key of success.

The invisible line only able to detected if you standing on the top of mountain. I am not asking you to climb up mountain and take a look. :). So, go up and feel it the fresh air and nice big picture with aim the bull... imaging it.

Stock movement = Human nature

There is nothing new on Wall Street or in stock speculation. What has happened in the past will happen again, and again and again. This is because human nature does not change, and it is human emotion, solidly built into human nature, that always gets in the way of human intelligence.
"Of this I am sure."
-Jesse Livermore

This is explained why stock movement pattern can be detected with your TA and FA skill and most important your "feeling". What you need is a simple trend analysis, able to understand simple financial data, and most important based on your reading how you feel it, feel good, feel risky, feel high chance, feel must buy, feel must let go now... your feeling will be your final decision.

This will a "basic" to enter a buy or sell, even you make a wrong decision, you will still happy with it as this is your decision. Also, you learned from mistake, your own the mistake, and willing to accept it.

No need to attend expensive workshop, just follow aim the bull 5 steps. :)

Human Mind...

Compass vs clock - which one u choose to be?

Compass - i use compass as a symbol to mark the financial data to remind that the direction where to go is most important. You know where to go then you will stick to it. If the basic no change, still strong, you will not act silly when price go against your expectation temporary.

Clock - more apply to contra, just reflect to what is happening now, u just do and do, you don't have direction, just react accordingly. Want faster settle it, as fast as possible. End up dont know what is doing and tired.

RGB - Going to be be cash cow company

RGB - if I not mistaken, it going to be a great company with cash rich and sustainable sales and profit.

2016-05-26 RGB  agm note
- 2016年是有前景之年，今年主打菲律宾。
- 1Q业绩今晚出报，比去年同期好
- fy2015 TSM division 业务增长主因 - 老虎机是与赌场共享成果，收入的重点。
- 目前高interest 债务偿还完毕，相信2016年可全数偿还。
- Realised 外汇收益23千万

A&M - financial performance maintain profitable

I think the price shoot up nothing to do with the flat change profitable financial performance but driven by something great hidden news (high speed train, carey island mega project). I mean hidden due to public still unaware but aware by certain of people.

HIL - remain profitable and cash cow

Profit from property continue to compensate the manufacturing loss mainly from forex loss (strengthen MYR) and lower sales.

Real cash generated from operating. The cash increased substantially from 128 mil to 147 mil.

D&O financial performance health check update

PnL profit by quarter before tax increased, so good sign. Then how about cash flow, is it improve? Good profit doesn't mean good cash flow in, need to further check. 

Ok, that's look good. Operating cash flow positive mean is real cash generated by real profit. The cash use to reduce bank borrowing and reduce interest cost as well. Sometimes the profit increased can be from non cash item, therefore need to be very careful to check for completeness as complete as possible or a better full picture. Don't fall into trap of fantastic PnL performance. Cash flow is another checking point. That's easy right? 

No need to attend any expensive workshop, just use aim the bull  5 steps measurement can help you avoid unnecessary loss. For instance, VIVOCOM showing so nice profit, but poor cash flow, then you know what I mean

VIVOCOM - accelerate going down hill

When the uptrend line damage, it's hardly go up again until the process of downtrend movement completed. But where is the bottom, so far still yet to see it's stop bleeding.

A&M break the wall; HIL get ready

Something great going to happen...

EG - Good news arrived and will bring future benefit yet to kick in to the price?

EG Industries Bhd has secured a US$36mil (RM146mil) contract to be the sole manufacturer for Flic, the world’s first wireless smart button that creates a shortcut to favourite actions on mobile devices.

EG Industries is one of RHB Small Cap Jewels Stock Pick
Current price: RM 0.865
Target price by RHB: RM1.20 (38% upside)

Look at the peak price is it mean the price already reflected as information always come late to public?

FLBHD - when TA expect a bullish breakout and TA confidence for the FA performance

When "interesting" bullish breakout call turn out into nightmare and FA result even still in healthy level, the sell down still unstoppable today. Actually this is all about timing, nothing to do the company financial performance as it only show lower profit. But, when big player buy at low price, they will not hesitate to take the profit before you. Buy with margin of safety or else risk of jail at high price. Don't worry, it will or possible to climb back, but you need very good patience. But will you have such patience if price dip further to its center or fair price determined by Mr Market?

Is today 6 mil share from MR Koon? We will know soon but normally he will update not on time.

D&O - Getting stronger from automotive market

My 5 simple steps will lead me to simple but effective value investing. My way to minimise the risk and maximise the gain.

Step 1: Check the PNL. Profit? Potential turnaround to profit?

Aim the bull: Profit growing with higher sale mainly from better margin automotive product sales pipeline. As automotive product required more stringent quality level, therefore is not easy for competitors to come into the business to share the cake. As D&O already successful penetrate into this market, this will be sustainable income for next few years.
Score : 1

Step 2: Check the cash flow. Where is the money generate? Where is the money go?

Aim the bull: After cash received from Epistar (big LED coy) to join development together, company cash level improved but still is not net cash company. Cash mainly spend on machines and R&D project. My thinking, R&D is very important spending to move company forward. If company is keeping at same position is equal to waiting to game over.

Score: 1

Step 3: Check the Balance Sheet. Is it only left the shit (e.g debt)? Cash status? Retained earnings for potential bonus issue? NTA vs price? Fair value vs price vs NTA?

Aim the bull: Price trading at above NTA. Cash and debt at manageable level. Mainly PE play. The continue profitable and positive cash flow is under monitoring by Aim The Bull.

Score:0

Step 4: Check the price status? Which wave? Uptrend? Downtrend? Consolidation? At peak? Measurement of margin of safety?

Aim the bull: Still in downtrend process. Price now trading at 0.30. Worth to close monitoring. My way is don't chase the high or the peak. Go search any stock with high chance to rebound. D&O can be the next, and need a better financial result to trigger it rebound.

Score: 0.5 as I'm not sure 0.30 is bottom.

Step 5: How is the outlook of the existing business and any potential sales pipeline?

Aim the bull: I like Green tech business. I monitor D&O because the automotive LED business outlook is very promising as now many new cars start to change conventional car light to LED light due to its lower power consumption, therefore this is a sun rise business and with attractive margin.
Score: 1

If score 1 or 2 points...forget it
If score 3 points...monitor closely
If score 4 points...collect slowly
If score 5 points...full force...sai lang

Overall 3.5 points...the risk is the price might not bottom reaching yet and fluctuation of techno business cycle.

Higher profit and tax recoverable

Take note of high goodwill value with risk of write down as a loss, cash mainly from. proceed from share subscription by Epistar. High inventory level also risk of material scrap if business slow down. High borrowing but manageable as sales is increasing with profit. Remember sales increase without profit will damage cash flow.

Higher spending in R&D to avoid the company outdated. Cash from operating still in red, manage to get new fund. I forsea if the automotive product mix ratio increased will lead to better margin and better cash as well. Remember company must generate profit with positive cash flow. Do not trap by high profit but cash in red.

ATURMAJU - Pump up dump down

Who buy at the peak will jail forever.

HIAPTEK - Counting down to Ex

Hopefully it can reach back to 0.50 but this is mission impossible to climb back to the trend.

HIL - Power up again

Should I collect it back? Let's see tomorrow how its perform.

SALUTICA - Bluetooth expert

LISTING TOMORROW (18th May 2016) on Ace Market of Bursa Malaysia

SALUTICA 

✅Salutica is a IPOH based company which is in the business of manufacturing bluetooth devices and other electronics and precision parts for external brands. It also has its own in house product line of Bluetooth 4.0 Technology,  with the brand name FOBO.

✅Salutica raised RM 62.4m from the issuance of 78m shares, with the proceeds being utilized for repayment of bank borrowings, working capital and R&D

✅Futures plans:
⭕expand FOBO products
⭕upgrade its existing plant
⭕new product development in        collaboration with its customers
⭕increase FOBO presence by adding 14 new distribution channel

✅It shares were oversubscribed by 9.98 times

IPO price: RM 0.80
♦RHB values it at RM1.18 (48% upside)
♦PUBLIC values it at RM0.99 (23% upside)

Market capitalization: RM310.4m
No of shares: 388m
Estimated free float: 26.0%

Sharing from rhbinvest

3A - start your engine by better profit in future

Price now was to reflect future financial outlook. 3A is moving to this direction.

Jesse Livermore 21 trading rules

VIVICOM - Profit and Loss very nice performance but...

Sales and profit look fantastic up. But, this is not a whole story yet.

The operating cash flow still in negative, that's not a good sign. Mean it need money from somewhere to support the business. Lucky that's private placement, to support the normal businesses activities to avoid stuck. Private placement always better than borrowing from bank.

Goodwill is something not tangible assets, you cannot touch it, u cannot see it, u can only feel it. Be careful for such of big value, it tend to risk of write down. Can gone any time from now. Unless you have intangible assets like facebook, google, Microsoft, etc, or else pls be worry.

As VIVOCOM trading at peak price but still within the uptrend line, so need to monitor closely. Any big drop and not able to reach back to its uptrend should be decided a profit lock or cut loss (if you're at the peak).

It just aim the bull opinion, so decision always on your side, I might be wrong due to lacking of information.

Refer 5 Steps to further understanding. 

HIL - this time i sold and it work

HIL made me disappointed 2 times already, but not for this time. Manage to let go some at 0.85. Now I will wait you below 0.80.

MSCI REBALANCING

MSCI rebalancing effective 1 June. Weightage increase for IHH, PBank n BAT.

Weightage reduction for CIMB, Maybank, AMNB, AFG, HLBk,  SIME,,UMW, IOIC, Airport, PChem, PDag, IJM,  Dialog n Bumi Armada.

Foreign funds that are bench marked  to MSCI index will tend to align to changes to reduce tracking error. Hence, foreign selling will continue another week or so. Guess it's best to let selling subside before picking up any of such stocks

RGB - In deciding where to go mode

Consolidation mode mean I don't know where to go.
To go up, i need a motivation factor.
To go down, u need to demotivate me.

VIVOCOM - perfect uptrend line slope

Slow but steady. Everyone like this movement.

Stock pick by RHBINVEST

12/5/16 Trading Stocks
1. LCTH (5092)
Entry : 0.685
TP1 : 0.73
TP2 : 0.785
Stop : 0.665

2. Wzsatu (7245)
Entry : 1.02
Tp1 : 1.08
TP2 : 1.16
Stop : 0.985

3. Leesk (8079)
Entry : 0.305
Tp1 : 0.32
TP2 : 0.335
Stop : 0.295

MJPERAK - May the force with you