Short term wise, share price can go anywhere.

But long term wise, it is the enough profit (not profit already can, but enough profit) to sustain the particular share price at what level. If Tanjong is not profitable and make >Rm1.00 EPS year in year out, there is no possible for this stock to stay above more than Rm10 for 10 years.

Classic example would be IRIS, go up from Rm0.20 to Rm1.00 and stay there quite a while up to half a year or so. But company didn't make enough profit, so eventually this only a bubble and waiting to be bursting only. But still in short term wise, there are people can make profit out of it, but surely not on long term basic. But if you are not lucky and get out in time, then you will get the burst
But this is different story for strong fundamental company that keep on register higher and higher profit, the share price only one way to go, is higher and higher (or getting paid in term of generous dividend), instead of swing up and down.

For fundamental good stocks, you only need to make 1 decision right, i.e. buy at reasonable valuation

For goreng stock, you need to make 2 decision right, ie. buy at low, sell at high.

what u think about maybulk? more room to go?

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Added on September 1, 2009, 4:02 pmmore room to go down?

This post has been edited by truth_seeker_09: Sep 1 2009, 04:02 PM

i'm watching it closely, too.

see whether can break 3. if yes, i wanna start averaging.

Based on its current fundamental, EPS, BDI situation, at 3.00 is a bit too high. But market is playing with recovery card now, so future recovery factor is taking in.

I would say mid to low 2.xx is more fair value. Just my view

That's why we don't see much buy call on this stock, more on hold or sell only.

Don't mean it can't go up in the future.

cherroy....any guides for calculating the fair value of a counter?

i've seen analyst calling a sell call on maybulk since mid of the year. with a fair value of 2.xx

but the problem is, she is so stubborn to go down

/press press her head... down down!

I fully agree on this. Maybulk is consider as too expensive as compared to STI shipping counters even at RM3.00.
Anyway, I don't think the price will drop a lot in near future as our EPF is supporting the price... So, if the future dividend is worth it, can still buy, but can't expect the price to shoot up significantly in long term (when economy recovers). Just my thought...

I think the much anticipated correction or bloodbath is unlikely to come. People are just holding onto their stocks because there's a general feeling that the worst is over. People will just hold and wait for the stocks to bullrun during economy boom. I don't see widespread panic selling even when the last GDP was released and put M'sia as technically in recession.

Because it wasn't a surprise. The common man already know we are in some form of recession. The report just stated what everyone was already expecting.

It is very subjective matter. But to make it simple, if you put 3.00 investment, if it expected to give you 10-15 cents return pa. (EPS), it is a good investment? Do you satisfy with it?

If answer is yes, then you can come out with the fair value already.
If answer is no, then it is a bit too expensive at 3.00 already.

Correction will come for sure. Just not sure how big only...
And yes. I agreed that when more ppl expecting something, the least chances of it will happen. This is exactly what happen in Mar where everyone expect CI to drop further, it bounce back.

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Added on September 1, 2009, 4:21 pmI was expecting a longer answer from Cherroy Tai kor on this matter...

This post has been edited by chyaw: Sep 1 2009, 04:21 PM

Dow Fut now -17 already....

Hi Cherroy, how do you count/expect how much you will get in return? for example maybulk. As FA, how to count the fair value?

Rambutan really goes crazy today, from today low 14.80 to 15.68 now, Makcik really know how to jack up price.

Hi Pana, are you gonna av down maybe from 2.99? till?

So many red counters ... hand so itchy to buy sumthing ... but tomorrow is wednesday ... must wait

2.80 - 2.60 - 2.40

my cost super high 3.30

Correction will only sneak in diam diam only, they won't come in big like say to you, now it is correction!

We are already now in correction phase, a low volume is one of its indicator.

If want bloothbath or crash, you need fear factor of unknown, just like last year end, you don't know which or who company will go under, then there is a lot of fear that can crash the market.
Now who survive who has better balance sheet, mostly has known, as well as Fed positioning, so a lot of issues are known now.
Unless we pop up something like commercial real estate having big problem, cannot refinancing on commecial mortgages or credit card debt going badly rapidly, which you don't know what will happen next and on whom/company, then fear factor start to rise again.

If FD rate is 2.5%, and bond yield around 3.x% at least 5% or more return from the stock market should be a fair expectation, which translate into teen number of PER for near term or current EPS
If FD rate is 7%, then listed company must able to generate more than 10% so that risk reward ratio is more fair/right which translate around PER of 10 for near term future EPS.

Tanjong should give a positive MACD cross by end of today.

It is certainly true that you make your money when you buy and NOT when you sell.