Presbhd - racing higher Part 4

Presbhd recorded an all-time intraday high of RM3.37 on 18.02.2014, and 3 days later, on 21.02.2014, it recorded another new all-time intraday high of RM3.51 which was partly due to the unexpected announcement of Bonus issue a day earlier on 20.2.2014. However, due to persisting selling pressure, the stock price retraced and only managed to close 1 cent higher at RM3.30.

Many people were felt disappointed at the closing trading session on Friday. After all, everyone was expecting a solid close because of the Bonus issue announcement.

For quite a long time, the stock price fluctuation has been quite orderly but last Friday was quite an exceptional day. There were indeed some trading abnormality on last Friday. Little was known to many people, 2 giants were fighting on that day. Apparently one giant was caught off guard to the unexpected announcement while the other giant was keeping things wrapped so tightly that they had made their moves very much earlier undetected. One giant felt that their ego got bruised, thus they unleashed a furry pressure to suppress the price hike. In the end, the losers on that fateful Friday were the retail players themselves. They thought they could make a killing but they got themselves slaughtered. But don't despair. The price climbed back with a convincing close today at RM3.46, upped 16 cents. It is also an all-time high close so far. All-time intraday high was RM3.51 and it is expected to be breached in the near term.

With a good Q4 financial report which was reported on Thursday 20.02.2014 coupled with Bonus issue announcement, the corporate story for Presbhd is getting better and stronger by the month. Avalanche of research houses started to give their research report with revised upward target price. The latest being from CIMB that put their target price at RM4.45. Whilst I am not surprise at all but I feel they should be more bold to give a more stronger target price, just like how RHB gave a bold target price for DSonic not too long ago.

Presbhd declares a total of 12 cents dividend for the year 2013. For comparison, the company declared 10 cents and 8 cents dividend for year 2012 and 2011 respectively,

Well, what more need to say about Presbhd now. Many research houses have offered their piece of opinion. If you still don't believe this is a strong growth company with robust business plans, then I think nothing will convince you anymore.

 

Its price closed at RM3.46 on 24.02.2014.

During Bull Market....

During bull market, everyone is his own stock market expert. You will seek out someone and if he or she say the same thing, this will sort of confirm your view on certain stock. But since it is a bull market, everyone view is positive regardless of which stock. Thus, everyone moves along the same direction. Everyone has their stock to offer, be it based on fundamental or hot tips, believing that this stock is good and have high hope it will go up. In the end, you have so many stocks to pick. Every other stock seem to go up every other day. How to be wrong, is the mood of the day.  Merry mood is all around. Long term investment is no longer an attractive word. Being a disciplined long term investor, you too deviate from your long held investment principle. Suddenly you find yourself putting your money into some of these unknown stocks that you never heard of not too long ago. The interesting part is these unknown stocks start to give you better and faster returns in no time as compare to your long term stocks that you already had in your long term portfolio. You start to question your wisdom to continue to keep those long term stocks and tempted to switch to stock that gives faster returns albeit unknown stock to you not too long ago. Unknowingly or knowingly, by now you already being sucked into the vicious cycle of getting in and out from one stock to other stock. The final outcome can be easily predicted. We shall see that in 2015 or might even earlier.

 

Those went through the up and down in 1987 and 1997/8 will able to fully comprehend what I just said.

 

And, I would like to add this - Stock expert does not come out during bull market. The real stock expert is the one that stay true to his or her investment principle during bad time and good time. How many of us is really one?

 

Having said all that, one also should enjoy the euphoria brings about by the buoyant stock market. Punt, contra, gamble or speculate any stock, whatever you want to call it. Life will be boring without a punt or two in stock market. But always watch your back. Set aside a small fund just for that to satisfy your thirst for excitement. Even if this fund got wiped out, you are lest concerned as your main capital is still preserved. But don't kill the goose that lays the golden eggs. Don't turn an enjoyable venture into a nightmare when the big storm come hitting. 

On another matter, UMA was back into the limelight recently. This remind me of what happened to Ecowld not too long ago and DSonic just yesterday.

Contrary to many may think, UMA is good thing for it will bring back normality otherwise it is a mindless pure speculation play. UMA is a psychology tool to tackle emotion. Speculation is about emotion. Emotion of greed. How else to explain if it is not psychology tool since UMA does not change a bit on the company fundamental but the stock price will tumble upon UMA being issued. What is not good is this is a sign of coming of an unhealthy market volatility. This is especially so when UMA is issued to good fundamental companies. Nevertheless, stock price will recovery fairly fast for good fundamental company. I predicted more UMA madness in the coming months.

On a happier note, are we not in bull market? If it is not, why are we talking about stock market day in day out? UncleZ too won't be writing here if we are not in bull market and certainly you won't be reading what I wrote if we are not in bull market.

Invest wisely. Stay invested. Good luck.

Things start to get interesting

A foreign fund will be on our shore soon. Armed with approx. USD100 million, they intend to take up position in our equity market. We have the privilege to know that they now have a list of 15 stocks to choose and they will select only 5 - 8 stocks that fulfil their criteria. One notable criteria is they are not in favour of any blue chip stock or KLCI index linked counter. We have the benefit to know of the list but stop short of knowing which of the 5 - 8 stocks they intend to take up positions. They have very good reason not to reveal to anyone lest the market will drive up the stock price before they take up their positions. As of today, they have not move in but very very soon.

We have been busy monitoring those stocks on the list for the past couple of days and apparently some market players has picked up the news which explained why some of those stocks had shown odd price movement behaviour lately. Perhaps they had taken their position ahead of possible action by the said fund.

What I meant by odd price movement behaviour? How many of us will really pay attention to the final minutes of the trading session. 4.45pm - 4.50pm is the Pre-closing period and between 4.50pm - 5.00pm is the Trading-at-Last period. Most of the time we tend to overlook the important of these 2 periods before the closing bell. Actually many things could have happened unexpectedly during this time. Of course, there is always a reason and the retail investor will not able to know.  The price matching with occur at exact 4.50pm and once matched, TCP price will be determined for the last 10 minutes of trading until closing bell.

The following charts which shown the odd price movement behaviour on 13.2.2014. I leave it to you to ponder.

Few seconds before end of Pre-closing session where price matching will happen at 4.50pm.

Moment after 4.50pm

 

 

Near closing bell

 Trading closed

If you happened to come across such price behaviour, you should savvy enough to able to take appropriate action to your advantage. By the way, Presbhd is one of the stock on the list that I mentioned earlier.

Good luck.

Its price closed at RM3.11 on 14.2.2014.

83% gains

My friend, a 59 years old investor, has the following shares in this portfolio. The first purchase was on 4.9.2013 when the fund was made available to him. He did confided to me that he did not blinker his eyes when making all these purchases since the fund is easy money loaned to him.

 

The table below is the detailed transacted made on a particular day.

The table below is just a summary which was posted in 2.12.2013.

Company	units	Price on 4/9/13	Price on 27/9/13	Price on 11/10/13	Price on 31/10/13	Price on 11/11/13	Price on 20/11/13	Price Review on 10.2.2014	Diff. +/- since 4/9/13
DSonic	50,000	3.33	4.42	-	6.25	-	8.43	12.35*	+9.02
OCK	125,000	0.62	0.685	0.70	-	0.81	-	0.765	+0.145
Presbhd	65,000	1.91	-	-	-	-	2.50	2.99	+1.08

What more need to say. Well done my old friend.

 

We have a good talk two night ago and we agreed that one only needs to get it right with just one or two stocks to make good returns. After you have done the necessary research on the stock and if it hit all the criteria, do not hesitate to go in big. However, be prepared to hold it out for 3 months, or 6 months, or even 1 year. The case in point is Presbhd. I have held Presbhd since 2012 at the price of RM0.80 or there about. On another note, if you have diversified portfolio, this is one of the stock you should have as your core investment stock.

 

As for OCK, one just need to have faith in it. Nothing will come easy but you will be surprised how 2014 will turn out for OCK. SCable will be the next stock to watch in 2014.

 

Some will noticed that my stock pick is quite limited. I seldom invest in more than 5 stocks at any one time since I am not in the business to speculate stock for short term gains. Value investing is my guiding principle.

 

By the way, never forget DSonic this year too. RM2.60 expensive? Think again. Throw the PE number away so that it won't cloud your innovative judgement.

Good luck.

Contra game in stock market

Many of the retail investors will sit in front of their computer to monitor their stock pick whenever they have just made their purchases. They will start to pray and hope that the price will start to move up the very next moment. They are unable to do anything. So just pray pray and pray is the order of the day. This not only happen to contra player but sometime also to short term player. We have to get real. No retail investor or even if all investors combined could able to do anything to move the share price. Only those big funds could only do that. Total transaction values in Bursa is easily more than RM1 billion everyday. Transaction values by retail investors on the street is only account for a fraction of the total daily transaction values. This point to the fact that the market is controlled by the big funds. I think most retail investors understand this, knowingly or unknowingly. But why do retail investors still play the stock market the way they played.

I can only think of one thing. In the absence of legal venue to gamble, stock market is the only convenient venue to try their luck. Many may disagree with me. The fact that most of us want to make quick and easy money is a trait that associated with gambling. The other trait that associated with gambling is short-term memory. Once burnt, one will swear will never make the mistake again but will repeat the same mistake in no time. I had seen it in 1987, 1998 and 2008. They repeated it over and over again. It is such a heartbreaking scenes.

My advice is always the same. Invest in stock market, Yes, by all means but invest wisely. There is no such thing as Contra wisely. Contra play is not suitable for people on the street - the retail investors. Yes, it sounds peculiar to hear that. That's the reality. Contra play suits well for the fund managers. They have the upper hand of the game. Retail investors is just the extras just like we used to call those in film production.

Sometime I wonder is there such a term as retail investor. Maybe retail player term sounds more appropriate.

If you have extra money, invest meaningfully in good stocks. If there were going to be any storm in the stock market, long term investor will not be severely hit. Take for example, if Presbhd price were to drop by RM1.00 tomorrow due to major market correction, my original investment capital is still very much intact. Consider that if I were to buy and sell, I will definitely be caught severely by any sudden major market correction. Think about it.

 

On another matter, later I will post a table showing how my 59 years old investor friend managed to pull off a spectacular gains from the stock market in less than 6 months time, but not until I could figure out why I am unable to attach the table or picture onto my blog space.

P/S: My definition of Contra does not necessarily mean the usual T+4. My definitely is more towards on the behavioural stock play in and out of a stock within short period of time i.e. 1 - 10 days.

Datasonic - the old flames still hot

I think I ought to revisit this old flames. This is especially so when the stock recorded another all-time high record after a relatively unexciting period for the last one and half month. Today it sparks again. Up 18 cents and hitting new high of RM2.48 with big volume.

 

 

Reflect back. The stock price closed at RM2.25 on the first trading day after the split exercise back in 23.12.2013. With today closing price of RM2.47, this represents an increase of about 10% since the split ex-date. Purely looking at the percentage number may not look attractive to some but to revert back to its old price for comparison, this represents an increase of RM1.10 within one and half month time. If this is not a good investment for long term investor, then I don't know what is. Those who have hang on to the stock without selling even after the split exercise, they will have make significant gains.

For comparison sake, the price now is equivalent to RM12.35 per share if without price split ! I always believe the price will be higher than this if the company management had considered our opinion to halt the share split exercise to a later date. Anyway, with or without share split, everyone is now very happy and that, I think is the most important yardstick for any share investment.

Let's watch how the stock will chart the untested new territories in the coming weeks. Stay tune.

 

By the way, those who remember my post on 3.12.2013 here discussing about 3 persons of different ages with different investment profile. I reproduced here the tabulation showing the investment of the 59 years old investor to see how his investment has bring more wealth than he initially anticipated.

 

Company	units	Price on 4/9/13	Price on 27/9/13	Price on 11/10/13	Price on 31/10/13	Price on 11/11/13	Price on 20/11/13	Price Review on 10.2.2014	Diff. +/- since 4/9/13
DSonic	50,000	3.33	4.42	-	6.25	-	8.43	12.35*	+9.02
OCK	125,000	0.62	0.685	0.70	-	0.81	-	0.765	+0.145
Presbhd	65,000	1.91	-	-	-	-	2.50	2.99	+1.08

The dates show the series of shares purchases were made. The price is closing price of the day which may not necessarily represent the purchase price made on that day.

*Current price 2.47 multiple by 5

 

Having a long term horizon in share investment is always a better bet for an average small time investor.

Price closed at RM2.47 on 10.02.2014.

Happy Chinese New Year 2014

Happy Chinese New Year 2014