Genting / Resorts, your time has come for you to retrace to 2 bucks a share!!!

I'm still aiming my Maybulk. My broker called few times already asking me want to enter or not, coz 2 of the previous support I said have been broken. RM4, RM3.8 and next is RM3.5. I keep telling her to wait first, see how market want o die or not, then only enter.

Are you saying that it is not or near bottom yet ?

But CI though at 1200 level, many stocks at trading at attractive PEs of 10 or less.

On the other hand, if oil price shoot up to US $ 200, do not really know what would happen to the stock markets.. worldwide ...could really crash ?

CASH IS STILL KING EVEN THOUGH INFLATION ? YES OR NO, you decide...

This post has been edited by SKY 1809: Jun 12 2008, 06:09 PM

Many stocks like what? Other than utility, shipping and steel counters which has traditionaly low PER levels, I don't think the others are even near the PER of 10.

If oil really shoot up to USD200, we might see a lot of energy conservation programs taking off. Which is good for the environment as a whole.

During inflation, cash is not as worthy as it cannot grow in value. But commodities like gold, copper or even oil gets higher and higher during inflation.

Even land/property can grow in value over time but the effect will be lagged.

This post has been edited by skiddtrader: Jun 12 2008, 06:14 PM

Look at Muda holding .

I brought it up at 55sen at PE less than 10x a month ago.

See the price today.

I see it's much higher now, but what are you trying to say, that all stocks PER less than 10 will one day fly up? That's not a good example. How many stocks can you quote out of all of KLSE has the same example as above?

I don't know how you pick that counter up out from the haystack, but from the last 10 minutes browsing through their company's past performance, I wouldn't even give it a second look much less try to buy it. Why?

Low cash but giving dividends, high debts that is not decreasing, high receivables every year. Their past 4 quarter's performance is less than average and suddenly their latest quarter is more than their whole of last year's profits combine.

I have no idea what they are doing but it must be something good, but why hasn't the price jumped up higher since it is performing so well. If it can deliver this kind of quarterly report for the next 3 quarters, their price would probably go up to RM2+ and I'm surprised it is still so low, unless of course this quarter's performance is a one time event?

Nevertheless, it was good that you spotted this low PER counter that paid off, but the question still remains, if all low PER counters are good, why isn't anyone buying up all of em?



Edit: But if the MUDA example is to prove that a company not from the industry I've listed, then I guess it's fair, although it's quite naive to think those are the ONLY industry to have low PER. High performance companies' will not have low PER unless it is an industry standard. Which is what I was trying to imply.

This post has been edited by skiddtrader: Jun 12 2008, 06:32 PM

You are posting a million RM question, like the CEO asking why the giant cannot perform in today corporate world....


You have all the answers ... then why asking ?

This post has been edited by SKY 1809: Jun 12 2008, 06:38 PM

Haha, if I ever had all the answers my friend. I'll be quiet and probably live off n a cave somewhere. To be inquisitive and question everything that moves is what differentiates a fact finder and luck stumbler.

Do not misconstrue my questions as an attack on your judgement, but rather a probe on what makes you decide on that purchase at RM0.55. Was the PER the only fact you considered when you made that purchase? Looking at all the observation I've pointed out, I would've normally shun this counter to oblivion until it provides a year of stable and consistent performance. That is why I like/want/need to know what made you BUY the counter, what was it that open your eyes and made you say "this counter will make me money?".



This post has been edited by skiddtrader: Jun 12 2008, 06:45 PM

In today internet world , there are facts and figures everywhere and all over the places, it is up to you to pick up and filter ..and decide ... your decision..

If you do not notice it, then probably you think it is luck .

Not the right or wrong way. it is about stock markets....

This post has been edited by SKY 1809: Jun 12 2008, 06:49 PM

That is true and that is why a person like me always ask questions of every kind, for the things I already know about and the things I don't know that I still don't know about.

Hey, if you aren't willing to share it's alright. But I still question your decision and maybe someone else will enlightened me when they spot the mark like you.

I wont even trust any of the accounting reports of Malaysian companies. There's too many unknowns, too much risk.

Seems like Malaysians companies, such as AirAisa are more creative than Enron and Worldcom combined. I always ask myself, how do these brokerage houses determine EPS/PER when the accounting statements are beautifully sugarcoated.


That's why i seldom speculate Malaysia shares; even more so now when the US equities are severely beaten up.

This post has been edited by AdamG1981: Jun 12 2008, 07:07 PM

It is quite the same in US or Malaysia , the differences are :-

US people can tolerate Billions and Billions of write off in US$ and more to come, but they do not see a hundred million RM error in Malaysia as acceptable. to them it is creative accounting beyond anything.

They preach ( the teachers ) while we have to learn ( the students ). But the students applied what the teachers preach, some times also not acceptable.

To me, both are wrong , either in US or Malaysia.

This post has been edited by SKY 1809: Jun 12 2008, 07:56 PM

Actually, US doesn't tolerate writeoffs. Look at Bear Sterns, Lehman Brothers. Both Worldcom and Enron senior management team were indicted and sentenced to jail after a lengthy investigation.

Transparency is key in US equities. If you follow the Lehman Brother's case, you will understand that investors confidence are severely shaken when the CEO says he doesn't need to raise capital but now requires two major cash injection to stay alive. Shares were 80 dollars few months ago, nows its at 26 usd.

As for malaysia's equities, sure there are some potential ones but Malaysia has never created a 5 star global company. (Maybe PBB can be one) Nevertheless, until Malaysia's accounting crediblity is restored, then more foreign investors will be interested.

You can say both markets are imperfect, but we always seek risk-less returns. And i can assure you, US equities are much "safer" than emerging markets.



This post has been edited by AdamG1981: Jun 12 2008, 07:59 PM

I think the big brother has to practise what he preaches ( old school of taught ).

AIG is losing US $ 8 billions, but AIA in Malaysia has to be more transparent all the while, I believe.

US retails sales at 8:30 am, another DISAPPOINTMENT?

---

Added on June 12, 2008, 8:08 pmThat's because AIG management took too much risk in the OTC market, same with all the big financial boys. You have a BIG leverage because you want to make more. So when couple of investments GO WAY BAD (subprime), they lost billions because of leverage.

Bear Sterns was one victim, and we are not out of the woods yet.



This post has been edited by AdamG1981: Jun 12 2008, 08:08 PM

For PE discussion side, I would like to add on something. (which I had post once sometimes back)

Since inflation situation has worsen and economy high probably will slowdown significantly. Using PE to judge a stock, can be a trap as well. Some counters do trade at low PE like 8x or 10x, because market doesn't believe those company earning is going to be sustained as previously, aka market expect their earning going to drop in the future, that's why those share price reluctantly to go up.

Eg. as PER is using past year EPS to compute, let say a company's EPS last year is 10 cents, but its share trade at 1.00, so by right at PER 10x, it looks attractive and cheap but due to the fact economy slowdown will hurt the company future earning let say next year it only manages to earn 5 cents only. Then current price of 1.00 become a PER 20x already which become totally not attractive at all at the same price of 1.00

So this is why some counters being traded at low PER. Market doesn't necessary right on every stocks, so if company future earning does show good result which is not as same as market expected of going down. Then share price will react to the positively to upside.

But a lot of times, market is efficient enough and most of the time get it correct (Not all, market does get it wrong sometimes), typically eg. would be financial stocks in US. Previously, all were trading at 6x or 7x only, (like Citigorup was at USD 40-50), which by right is very very cheap, but market get it right, even at 6x or 7x, they are still bloody expensive and look at where those financial stocks now. No PE at all (because making tonnes of losses). FYI Citigroup now is less than USD20.

So of purely look at PE alone, then one would buy at USD50, 40, 30. But won't buy at USD 20 because now has no PER already. Just joking.

Don't get me wrong, PER still a good way to judge a stock which is one of the basic fundmantal of stock investing. Just to remind people of potential PE trap (because PE figure is backward looking), as overall picture especially future of company is the main consideration of the stock market (as stock market is forward looking).

So using data and figure with due diligence. Don't rely a single data for any judgement, look at overall picture to justify so that view is much wider and potential being more accurate.

Just my 2 cents.

A mixed bag result.

Retail sales is much better than expected but jobless claim creeping higher.

For the next few month as there is a stimulus package by the US gov (giving some pay cheque for tax rebate or something), so retail sales might stay on high as long as consumers has the money to pay for it.

This post has been edited by cherroy: Jun 12 2008, 08:51 PM

Thank you for your lengthy explanations.

In today trend, investors do not just rely on historical PEs alone as mentioned by you, future PEs of next 3 years are more important.

But if oil price is going up and up, impact on future no doubt is great, big adjustment might have to be made.

Like the case of Malaysia, the sudden increase of petrol and diesel would have great impact on our markets.

of course beside PEs, other imp ratios such as gearings, ROE and eps are o be considered.

This post has been edited by SKY 1809: Jun 12 2008, 09:34 PM

Yes, you are right. I am watching tomorrow's CPI/PPI number but judging from imported prices today, i would expect CPI to jump a huge number. MY trading strategy would to short FKLI tomorrow for DJIA Friday's drop of 200 points.


Peace

wat good news to drive US market to rise?