Thursday, October 30, 2008

Capturing a Bottom? From Another Perspective...

Below is an opinion from Dennis Wee from You should check out his site, some articles are great especially the one regarding the topic of "should you stretch your HDB loan". (Ans is yes of cos to the max...)

"In the last few months, many people have come out to say from time to time that "we are close to a bottom". I especially find remarks from Mr Wong from fundsupermart funny. Why? I've lost count how many times I heard him say something like that for the last 7 months since Mar 2008.
He would say something like that:"no one can pick the bottom, but markets are now looking cheap and we are either at a bottom or approaching one soon...."
From my observation, stock markets typically bottom with a "double bottom", it looks something like a "W" character. Can you see the "W" (double bottom formation) of the Dow chart below, the first bottom was in year 2002 at about 7,528 as I have marked out, the 2nd bottom was in Mar 2003.

Another thing you notice is that there are a "few months" separating the 2 bottoms, which give you enough time to buy stocks even if you have missed the second bottom.

My observation tells me that markets typically bottom after 3 things:
1. most people have run out of money to invest. (because they invested all their money too early).
2. the few who still have money, majority of them are too afraid to invest, because they have already lost a lot of money investing.
3. As mentioned, I observe that stock markets typically bottom when the economy is at its worst.

For example, in 1996 after markets peaked, it only bottom in Oct 1998.
In year 2000, after markets crashed, it only bottom in March 2003.

Singapore has just entered into a technical recession, and govt has come out to warn Singaporeans about bad times ahead.

Thus, it is clear that Singapore's economy has not reached the worst stage yet and thus, any stock market rallies in the meantime is likely to be a Bear Market Rally (trap) rather than recovery.

Let the Market Bottom Passes You By
As mentioned, one way to reduce risk is to let the market bottom passes you by, instead of trying to pick the bottom. Of course, by letting the market bottom passes you, you might end up paying 10% to 25% higher prices for stocks. However, if each Bull Market Cycle is 3 to 5 years, and prices might go up 100% to 300% in each cycle, I would rather pay a higher price than risk catching a "falling knife" (you buy cheap, but prices get even cheaper)."

SGDividends says: Well, so many experts saying this and that. We remember in early part of 2008 or end 2007, we hear so many so called GURUs mention that the stock market will pick up by end 1st quarter of this year. Later it did not materialise and they pushed it back to Mid-year 2008 and yet again it did not materialise. Now some GURUs are again saying that the market will pick up in mid-2009. So many wrong calls from so-called experts. The morale of the story is : As long as the company is cheap based on fundamentals like NTA, Gross Profit, strong balance sheet, high barrier to entries, unfair advantage, strong management (integrity), strong prospects , not overly dependent on a few customers or suppliers, good debt profile, porters five forces....e.t.c just whack your heirloom and life savings into such companies. ( Yes we are pretty risk-taking..we hear...cos we have a long time horizon). We don't see the point of catching a bottom....Our 21 cents worth. What Dennis says makes sense though..but we just don't bother about a bottom when investing..though we do still punt cos it looks cool if we are right. VIX Indicator!

Important: The objective of the articles in this blog is to set you thinking about the company before you invest your hard-earned money. Do not invest solely based on this article. Unlike House or Instituitional Analysts who have to maintain relations with corporations due to investment banking relations, generating commissions,e.t.c, SGDividends say things as it is, factually. Unlike Analyst who have to be "uptight" and "cheem", we make it simplified and cheapskate. -The Vigilante Investor, SGDividends Team

Wednesday, October 29, 2008

Raffles Medical - Are you well, Doctor?

Raffles announced its financial statements today. Since its in the business of treating people's illness, given this recessionary environment....would it do well? Will it, because people scared to "chao keng" take MC then kanna fired, see a dwindling of revenue? Or will it, because people become more gloomy, resulting in more illnesses see a rise in revenue? We don't know and we dont care cos of the following pic. You bet we will be visiting the group more often!Ok let's get down to business, shall we?

Come Doc, show me your tongue. Say aargh...Ok your Net Profit margin comes in at 16%. Hmm, pretty decent. You keep it up Doc. Drink more water and stay away from milk as it will aggravate you diarrhea.

Now, please lie down, lift your legs and let me poke your tummy. Let's see your current assets is lower than your current liabilities. Oh dear, what a terrible gastric flu you have. Luckily, its just a common gastric flu and you are just short of only 67314,000-67109,000 = 205,000. Here let me prescribe some common tablets and you will be well in a jiffy!Nothing to worry much about, it seems.

Oh my Doc, are you hiding anything away from me? How much is the interest for loaning that S$25 million?It would greatly help me in prescribing the right medicine, you know.

Let me check your heartbeat now. Keep still Doc. A positive Free Cash Flow, well Doc, not to worry, you will be fine. Take it easy on the Nurses, OK....

Your price now is $0.67 and your NAV per share is $0.41. You are not cheap eh Doc..but then again you are supposedly recession should be fine..Keep attracting patients from abroad Doc..

Important: The objective of the articles in this blog is to set you thinking about the company before you invest your hard-earned money. Do not invest solely based on this article. Unlike House or Instituitional Analysts who have to maintain relations with corporations due to investment banking relations, generating commissions,e.t.c, SGDividends say things as it is, factually. Unlike Analyst who have to be "uptight" and "cheem", we make it simplified and cheapskate. -The Vigilante Investor, SGDividends Team

Singapore Telecommunications - Losing its Competitiveness?

In Today's paper ( which was yesterdays actually on 28 October 2008), there was a small column in the business section that wrote:
Quote:Terria, a consortium bidding to build a part government-funded broadband network in Australia,yesterday lost another partner. Australian Capital Territory-based Internet provider., TransACT, has withdrawn its support for the group, which is led by Singapore Telecommunications' Australian Optus.

Terria chairman Michael Egan said in a statement that the group still plans to bid for A$4.7billion in federal government funding to build a high-speed Internet network reaching 98 percent of Australian homes. The news is another blow to Terria, which is vying with Australia's biggest Telecommunications company, Telstra Corp, to build the network.

Another group member, TPG-Soul, withdrew its support on Friday, while Telecom Corp of New Zealand Australian arm,AAPT, pulled out of the consortium due to financial concerns earlier this month. Terria has also said recently that it is considering alternative funding options given the turmoil in global financial markets, which is crimping firm's ability to raise capital for projects. The government has called tenders by Nov 26.DOW JONES Unquote

So let us's safe to assume( or infer or deduce) that Terria is more likely not to get the contract. Optus's revenue pie is about 3.5 times of Singtel business in Singapore. ( thats a lot!) Singtel group's data and internet portion of their revenue is about 20+% and thats a large chuck of the groups revenue. It's interesting to see how Singtel will manage to grow its revenue in Australia. Go downunder...mate!

(We got to admit we are not IT Gurus so we are assuming Data and Internet is related to the above high speed internet network? No? Pls Shoot us down, slander us, demean and insult us if we are wrong...we are rock bottom shameless already).

Important: The objective of the articles in this blog is to set you thinking about the company before you invest your hard-earned money. Do not invest solely based on this article. Unlike House or Instituitional Analysts who have to maintain relations with corporations due to investment banking relations, generating commissions,e.t.c, SGDividends say things as it is, factually. Unlike Analyst who have to be "uptight" and "cheem", we make it simplified and cheapskate. -The Vigilante Investor, SGDividends Team

Monday, October 27, 2008

ChinaMilk - Mooing away to a Bullish Time?

ChinaMilk has suffered a crisis within a crisis within a crisis for 1) being a China Share 2) Being embroiled in the Melamine scandal and 3) being in the financial crisis. As the saying goes, in crisis lies great opportunities, therefore, our SGDividends radar decided to zoom in on this counter. Is there a GEM of an opportunity? Let us see...

It's net profit is an astonishing 64%!! Not surprising actually when one thinks of it, just think of how cheap semen is and embryos.

Looking at the balance sheet, the current asset is much much larger than the current liabilities. And look at its Cash warchest! It is much more than the current liabilities. For sure, this is one company that does not require to take on any loan during this credit crunch.Just to confirm, we looked at another part of the report, just in case there was a printing error. (Just joking, see below)Voila! It has nothing to repay within this year.

We therefore proceeded to look at the Cash Flow Statement, and guess what again, it has a rich, sustained FREE cash flow. Sperm is indeed cheap. This company will only continue to increase its already gargantuan cash balance.

So let's see how cheap is this company. See below. Its Net Tangible Asset 246RMB which is approximately 49cents and what is the now? 35 cents. Cheap!

Risk Reduction
On 26 September 2008, samples of the Group’s raw milk were sent to an independent laboratory for testing, namely, Daqing Bureau of Products Quality Supervision and Inspection (大庆市产品质 量监督检验所), a government laboratory accredited by the Heilongjiang Bureau of Quality and Technical Supervision (黑龙江省技术监督局) which in turn is an affiliate of the General Administration of Quality Supervision, Inspection and Quarantine of the People’s Republic of China (国家质量监督检验检疫总局) and it was tested that there was no trace of melamine.

Possible Upside
A recent acquisition of a joint venture company with the Heilongjiang Animal Breeding Centre of an amount of SGD$28.6 million which it paid for entirely with cash. Objective of acquisition has got something to do with sourcing for superior breed Holsteins from Heilongjiang and neighbouring provinces instead of Australia to save cost. ( A good sign eh....)
Given that it has not been embroiled in the melamine scandal, and part of its business is also to sell raw milk, it should be possible to take market share from its melamine- scandaled competitors don't you think?? Your guess is as good as ours!

Important: The objective of the articles in this blog is to set you thinking about the company before you invest your hard-earned money. Do not invest solely based on this article. Unlike House or Instituitional Analysts who have to maintain relations with corporations due to investment banking relations, generating commissions,e.t.c, SGDividends say things as it is, factually. Unlike Analyst who have to be "uptight" and "cheem", we make it simplified and cheapskate. -The Vigilante Investor, SGDividends Team

Warren Buffet Letter - His Thoughts on Financial Helper's AGAIN. OLD FOGEY!

Below is an extract from Warren Buffet's Letters where he wrote against enlisting Helpers ( Wealth Managers in general) in managing one's money. SGDividends, however, thinks he is being a bit too extreme towards them but then again he is an old fogey. Anyway, as he himself owns an insurance business, we don't think he is refering to insurance helpers or else he would be commiting "hara kiri",right?( we have to say this also or else our insurance helpers will kill us. Anway, we have had great insurance helpers and have benefitted a lot from them. There are still some good sheep around.) This is his second letter (posted in 2006) where he has blasted these people. The other one appearing in 2007.

The Old Fogey's Letters:
"To understand how this toll has ballooned, imagine for a moment that all American corporations are, and always will be, owned by a single family. We’ll call them the Gotrocks. After paying taxes on dividends, this family – generation after generation – becomes richer by the aggregate amount earned by its companies. Today that amount is about $700 billion annually. Naturally, the family spends some of these dollars. But the portion it saves steadily compounds for its benefit. In the Gotrocks household everyone grows wealthier at the same pace, and all is harmonious.

But let’s now assume that a few fast-talking Helpers approach the family and persuade each of its members to try to outsmart his relatives by buying certain of their holdings and selling them certain others. The Helpers – for a fee, of course – obligingly agree to handle these transactions. The Gotrocks still own all of corporate America; the trades just rearrange who owns what. So the family’s annual gain in wealth diminishes, equaling the earnings of American business minus commissions paid. The more that family members trade, the smaller their share of the pie and the larger the slice received by the Helpers. This fact is not lost upon these broker-Helpers: Activity is their friend and, in a wide variety of ways, they urge it on.

After a while, most of the family members realize that they are not doing so well at this new “beatmy- brother” game. Enter another set of Helpers. These newcomers explain to each member of the Gotrocks clan that by himself he’ll never outsmart the rest of the family. The suggested cure: “Hire a manager – yes, us – and get the job done professionally.” These manager-Helpers continue to use the broker-Helpers to execute trades; the managers may even increase their activity so as to permit the brokers to prosper still more. Overall, a bigger slice of the pie now goes to the two classes of Helpers. The family’s disappointment grows. Each of its members is now employing professionals. Yet overall, the group’s finances have taken a turn for the worse. The solution? More help, of course.
It arrives in the form of financial planners and institutional consultants, who weigh in to advise the Gotrocks on selecting manager-Helpers. The befuddled family welcomes this assistance. By now its members know they can pick neither the right stocks nor the right stock-pickers. Why, one might ask, should they expect success in picking the right consultant? But this question does not occur to the Gotrocks, and the consultant-Helpers certainly don’t suggest it to them.

The Gotrocks, now supporting three classes of expensive Helpers, find that their results get worse, and they sink into despair. But just as hope seems lost, a fourth group – we’ll call them the hyper-Helpers – appears. These friendly folk explain to the Gotrocks that their unsatisfactory results are occurring because the existing Helpers – brokers, managers, consultants – are not sufficiently motivated and are simply going through the motions. “What,” the new Helpers ask, “can you expect from such a bunch of zombies?”
The new arrivals offer a breathtakingly simple solution: Pay more money. Brimming with selfconfidence, the hyper-Helpers assert that huge contingent payments – in addition to stiff fixed fees – are what each family member must fork over in order to really outmaneuver his relatives. The more observant members of the family see that some of the hyper-Helpers are really just manager-Helpers wearing new uniforms, bearing sewn-on sexy names like HEDGE FUND or PRIVATE EQUITY. The new Helpers, however, assure the Gotrocks that this change of clothing is all-important, bestowing on its wearers magical powers similar to those acquired by mild-mannered Clark Kent when he changed into his Superman costume. Calmed by this explanation, the family decides to pay up. And that’s where we are today: A record portion of the earnings that would go in their entirety to owners – if they all just stayed in their rocking chairs – is now going to a swelling army of Helpers. Particularly expensive is the recent pandemic of profit arrangements under which Helpers receive large portions of the winnings when they are smart or lucky, and leave family members with all of the losses – and large fixed fees to boot – when the Helpers are dumb or unlucky (or occasionally crooked).

A sufficient number of arrangements like this – heads, the Helper takes much of the winnings; tails, the Gotrocks lose and pay dearly for the privilege of doing so – may make it more accurate to call the family the Hadrocks. Today, in fact, the family’s frictional costs of all sorts may well amount to 20% of the earnings of American business. In other words, the burden of paying Helpers may cause American equity investors, overall, to earn only 80% or so of what they would earn if they just sat still and listened to no one."

Sunday, October 26, 2008

Countries at Risk? What's next?

2 things led to Iceland's situation. Monetary policy and Banks Overleveraging. To cut it short and sweet. Here we go?

Monetary PolicyGovernment's policy is to raise interest rate when inflation rises and lower interst rate when inflation decreases. As inflation has been damn high, Iceland has been raising the interest rate continuously, resulting in interest rates exceeding 14%, relatively higher than other countries. And this resulted in foreigners putting money into Iceland to earn that rate. When they do that, they are basically buying the currency and basic demand and supply tells us that exchange rate rises as a result. But now money are fleeing out and now, the currency go "starn" and plummets. As always according to the natural law of gravity, what goes up must come down and what goes down must come up.

Banks Overleveraging Need we say more?

Anyways, we were just itchy and curious ( as usual) and picked this up from the IMF. And we noticed that Iceland's Current Account Balance ( as a percentage of GDP) has been negative from 2006,2007 (partial estimate), 2008 (estimated). See the other countries on this list closer to home...Vietnam, Australia, New Zealand....and USA and UK. Are this countries at risk too? What are their foreign reserves?We will leave it up to our sexy readers. Please note the shaded grey green are IMF estimates by the way.....

Friday, October 24, 2008

Warren Buffet Letter's...A Time to Resynchronise Our Mind

Having been blasted with bloomberg, reuters, buy, sell calls, reports, announcements, opinions, news,CNBC and all the jazz matazz surrounding us today, the SGDividends team decided to retreat to the beach side, taking with us some letter's from Warren Buffet to realign our thoughts again.It's not that we believe everything he says, cos we don't believe anything unless we have researched, verified with common sense and pondered with facts before we believe. However, since he did mention something about a person not needing a high IQ to invest wisely, just some common sense, so we thought hey, it seems like a good fit to us, given that our peabrain monkey has averaged down the group's IQ. Therefore, his letters we brought. These letters were sent to us last year, and we have cut and paste the letters in soft copy (below) to show our dear readers the things which stood out.

Quote: "The presence of layers of consultants and high priced managers ("helpers")........Beware the glip helper who fills your head with fantasies while he fills his pockets with fees." Does it ring a bell? Minibonds? In fact, its plain common sense that the more middlemans you have between your investments and you, the less net cash is actually invested after deducting expenses to line their pockets. Yes,yes, we are hearing some people now saying: but these middlemans have the expertise and we, don't have the expertise, what if we invest wrongly. Let Warren Buffet answer this question. "....but this group will incur high ...advisory cost...their returns diminished by a far greater percentage than will their inactive brethren." So the morale of the story is : invest by yourself, minimise your churning, and if you really know nothing, maybe you just copycat warren buffet?Like the recent GE or Goldman Sachs...and guess what you will be buying at a cheaper price than him as of you will beat him...sounds good?
Quote: "I should mention that people who expect to earn 10% annually from equities during this century, envisioning that 2% of that will come from dividends and 8% from price appreciation- are implicitly forecasting a level of 24,000,000 on the DOW by 2100" . Warren is implying that 10% annually is unrealistic, isn't he..that Old Fogey! But then again, GIC raked in an annualized real return of 4%, so maybe this dude's right. That's a sobering thought though..But here at SGDividends we will show him that he is wrong...grrrgh.

Now now, what does Warren Buffet says about Airlines. He hates it and we believe he is right. Look at where we are now! A typical cyclical industry where even in bad times, expenses are still high and oil prices in our opinion is only going up up up and away ( in the long run). Anyway, before we pen off, just to let you know how low our group IQ has becomed, our peabrain monkey just said: Happy Hari Raya...Adilfitri.

So Do You Think We have Bottomed?Ask Your Auntie and Uncle

Below is an article extracted from a US newspaper published on 24 Oct 2008 where they mentioned their 5 reasons they do not believe market has bottomed.(Which SGDividends shares the view too. See our article on 9 October where we say we are still 1/2-3/4( as in around 1/2 to 1/4 more to a market bottom, reaching there). In red are our commentateries.Charts are placed by SGDividends. Must say or else gana sued. USA is Sue King. Singapore is Complain King. ( but we are seeing an emergence of Sue kings here)

Stocks Haven't Bottomed
The best news today is that most indexes didn't breach intraday lows set on October 10. The bad news is we're still testing them. (For the record: Intraday lows on that day were 7884 on the Dow and 840 on the S&P 500.) Even after most markets crashed by more than 25 percent in the past month, the longer we spend bouncing around lows amid huge volatility, the longer daily trade will remain a white-knuckled ride.
(SGDividends: Good morning ladies and gentlemen..*beads of sweat trickling down*...erhem....*silence for a moment* ...We have no Comments only to say that the Spore market laggs the US market...and wait till this local earnings season has passed and more layoffs have been announced.)
The Dollar's Rise Is Fear-Fueled
While world markets sink, the dollar is continuing to climb. While that's great for American purchasing power, the disconnect going on in currency markets right now is a big part of what's keeping traders spooked. The yen is rallying hugely too, hitting a 13-year high against the dollar today. The rise in both comes thanks to cash fleeing riskier markets around the world and seeking out the safe-haven currencies. (Another good indicator on why Market's have not bottom. However, SGDividends think this is highly irrational. Because we bet our pet monkey's banana that in the long run the US dollar will go down. The "wisdom" of the crowd.....tsk tsk.Transfer here transfer there...won't you lose out on transaction costs? Unless you are a Forex trader...)

The Global Recession Looms
The drop in the stock market made its way around most of the globe before hitting the United States. Japan, Germany, and Britain all watched with horror as their stock markets slumped close to double digits in a single day. It's a loud hint that the problems in credit and the economy that sent U.S. markets into the tank over the past several months are not a local phenomenon. Also, Britain's GDP shrank 0.5 percent in the quarter, a sign that a '90s style recession is in the works. The sterling had its worst day against the dollar in 37 years. For American investors, it's the latest confirmation that hoped-for export growth won't do much to boost U.S. sales as the entire globe suffers an economic slowdown. Two other points there: Gold and oil prices continue to drop as commodity demand says a global slowdown is already here.
(SGDividends: Did't we hear people calling us to invest in Gold not so long ago? Didn't it appear in newspapers not so long ago?And how about Commodities in Newspapers? Morale of the story is go against the crowd. When newspapers publish something to promote it...its most probably the time to sell.....quite logical but safety in numbers..we hear...Another way is to go to the market and talk to aunties and uncles, drink kopi with them, massage their backs, rub their legs "chikopek" them and ask for their advise. Then do the opposite.We think this is very very accurate. Fund Managers should consider employing these people to give views internally, then publish the opposite. Quite sure will beat benchmark index easily.***Not disrepectful of the elderly, its just that they are laggards of the grapevine.)

Earnings Are Still Falling

You hear a lot about how stocks are cheap these days, but whether you think that's true depends on whether you trust earning estimates. Today, Sony and Daimler scaled back their earnings forecasts. So far, the third quarter has been a season of lowered expectations as analysts slash their 2008 and 2009 forecasts. And even after all of this, markets may not be cheap yet: Mark Hulbert at MarketWatch notes the history of price-to-earnings ratios show stocks don't necessarily look cheap at these levels. Using as-reported, trailing 12-month EPS, P/E ratios have been higher than they are now only 21 percent of months since 1871. That means stocks now are more expensive than 79 percent of the months going back 138 years. Tough odds, those. (SGDividends: Earnings season in Singapore now.And the above article uses the P/E which we think is quite crappy by the way ..this ratio.)

Credit Refreezes

Schadenfreude was flying yesterday after former Federal Reserve Chairman Alan Greenspan said he was "shocked" at the credit market "tsunami" and admitted he was "partially" wrong not to regulate some of the securities that caused the problem as they evolved on his watch. His admission came during the first week in months that frozen credit markets showed early signs of a gradual thaw—until last night. The sell-off put the fear right back into banks, as the Libor lending rate jumped 7 points overnight to 1.28 percent. It looks as if we've taken a step back. A loss in confidence between lenders around the globe was beginning the slow process of reversing itself for most of the past week, and that improvement was viewed as a first step on the road to recovery. That has now stalled in various corners of the credit market. Investment grade debt is weakening, too. (SGDividends: Not comments...go read the newspapers. )

Volatility Signals Confusion
Market volumes were about average despite the swings, but fear is still sending indexes whipsawing. The VIX index, Wall Street's "fear gauge," hit a record high of 81.17 when the market hit its current low on October 10. It traded near 86 at the open before falling back as the market's worst fears went unrealized. Six months ago, the VIX was around 20. (SGDividends: Its one of the indicator we use.)

Another Way To Look At Debt Repayment - Jaya VS Ezra!

This is massive...seriously..the sell down ( we believe it's due to margin calls and the mandatory liquidation of positions)and its during these kind of periods that SGDividends believe that more weight have to be placed on analysing the debts of companies.So let us consider another well known measure. Interest coverage ratio. And let us apply it to 2 companies. Jaya and Ezra.(As of today 24 Oct 08, Ezra's 1 day drop is 10.2% btw and Jaya is 16.4% and guess what ?Jaya is giving a dividend payout..ha, is it prudent to do it Mr Jaya, shouldn't you save it for a rainy day like in POSB MySavings Account?). So just what can this ratio do? And why are we comparing this 2 companies? See below!

Interest coverage indicates how many times the interest could be paid from available earnings, thereby providing a sense of the safety margin a company has for paying its interest for any period. A company that sustains earnings well above its interest requirements is in an excellent position to weather possible financial storms. By contrast, a company that barely manages to cover its interest costs may easily fall into bankruptcy if its earnings suffer for even a single month. This is especially true for cyclical industry!


Jaya Holdings (Above)

Ezra (Above)

Ezra's interest converage after deducting for one off items is a mere 5.06% and Jaya's is 52.5%. No wonder Jaya can still give off dividends and Ezra has not declared any dividends. Even if we give Ezra a chance, and don't deduct their one off items, its coverage is only 26.1%, half of Jaya's! Tsk Tsk Tsk. No wonder you are in the top volume for 2 days consecutively.

And hello...dear readers..look at how these 2 companies are still so optimistic about the oil and gas industry. Do they watch CNBC or have they been living in a cave? As usual the management talk!

Important: The objective of the articles in this blog is to set you thinking about the company before you invest your hard-earned money. Do not invest solely based on this article. Unlike House or Instituitional Analysts who have to maintain relations with corporations due to investment banking relations, generating commissions,e.t.c, SGDividends say things as it is, factually. Unlike Analyst who have to be "uptight" and "cheem", we make it simplified and cheapskate. -The Vigilante Investor, SGDividends Team

Thursday, October 23, 2008

Barber Does Research on Ezra...Finally!

Picked up a call from that beefy barber. Says he is scared, now that he knows Ezradoesn't make Ezlink cards.....haha..he is one cute fellow. Anyway, that barber ( beginning to do some research AFTER buying into the stock) sent us this article below. Take note that this article was published in Aug 2007 with analysis from DVB Bank,an international advisory bank and finance house that specializes in the global transport market and they speak about oversupply especially when oil prices head south.Just food for thought!

Dearest Barber, pls do the proper research next time before investing your money or you will have to cut hair till you grow old...

Ezra ...Fighting Spirit Among the Ranks!

Wow wow wow...Ezra made it to the top 20 hitlist for highest volume. See article we wrote about Ezra here. ( We neber short the stock ah..promise you can see the article we wrote wasn't that negative and we are unbiased, only pure facts merlion from our mouth, with substantiated data.) Having said that, we absolutely love Ezra management's swift and sharp response to the Citigroup Investment Research Analyst's report on 22 October 2008. Meeow...Grrrgh...catfight!Owww..Here is their response.

Well SGDividends is neutral to their "intense discussion". (But we kinda like Ezra's management though...but then we also liked Citigroup's "Dream's never sleep" commercial). is something for our readers to think about. This was from Ezra management's mouth in the year 2003 Prospectus. What do you guys (or lovely ladies ...darlings) think, given this current environment?

And if you have read what Citigroup wrote and what Ezra replied about the following term" Market Disruption Clause". Below is an article from The Financial Times regarding it.

To avoid the risk of seeming like we are biased, we have compiled the following link for our readers to read to get the big picture. As our parents always say, let's hear the other side of the story before jumping to conclusions!
Ezra Current Shareholder Responds to a forummer's opinion.
Jaya Holdings, the SGDividends Team is watching you .............

Wednesday, October 22, 2008

House price drop

The drop in Canadian home prices in September may not be as severe as it seemed, TD Securities said on Wednesday, bolstering the case that the country is not headed for a U.S.-style housing meltdown TD, a unit of Toronto-Dominion Bank, argued in a report that home prices fell 1.3 percent in major Canadian markets in September, not the dramatic 6.2 percent drop that was reported by the Canadian Real Estate Association (CREA) last week.

CREA said the average house price fell to C$315,461 (about $252,000), dragged down by sales declines in Vancouver and Victoria, British Columbia, which offset rebounds in Calgary and Edmonton, Alberta. CREA said the fall came despite year-over-year gains in average home prices in 17 of 25 major Canadian markets.

TD crunched its own numbers and applied a weighting to each major city to fix "compositional shifts", which it said were behind the distorted CREA view. It said the association has acknowledged the problem.

For example, if Vancouver was the only city that reported sales in one month, and the next month Montreal was the only city that reported, then it might seem that prices had fallen in half because Montreal prices are much less expensive than those in Vancouver.

TD fixed the weight of each city to year-earlier sales levels as of September 2007.

"We wanted to get rid of the whole compositional issue. We really just controlled for the allocation. When we did that we ended up with a 1 percent drop instead of a 6 percent drop," said Eric Lascelles, chief economics and rates strategist at TD Securities.

"That's not catastrophically different, but to me that's a number that makes more sense. Yes the housing market is correcting moderately but it does not have the making of a U.S.-style correction."

He said Canadian housing starts may fall below the 200,000 mark, home prices will continue to correct in some inflated cities, but there is no need to brace for big delinquencies or a hard drop in prices.

The TD calculations aren't perfect, Lascelles acknowledged, because they do not eliminate some factors such as type and quality of home in each city.

Canadian housing data has shown signs of softness but nowhere near the slump that hit that United States, stemming from a crisis in the subprime mortgage sector.

Historical Cycles - From Rags to Richest! ( Not Grammer problem..purposely one)

Why must CNBC show Barack Obama and John McCain's election sentiment results on airtime....arrgh! We don't care about Politics...We just care about Ben Bernanke and Henry M. Paulson! They should be the Presidents! Neways..let's talk about why you should start eating bread and drinking water for lunch and dinner. Breakfast skip. And the money go where? hand in the stock market loh. Portfolio allocation: 99.999% in stocks...0.0001% in Ezlink card! ( Ok exaggaratting and joking..). Let's look at history, shall we?

Based on the above data from the US government ( legitimate ok...dont pray pray), for the latest time horizon, from 1945 -2001, there were 10 cycles. The average duration from Peak to Trough is 10 months while the average Trough to Peak is 57 months. This is summarised by our cheap artist below:

This means that downturns are fast and furious and upturns are relatively slower. And what does this mean friends... ( Darn Citigroup best man...their commercial has really captured our mind day and night...cannot get the words out of our head!!) But then again..this is unprecedented....yeah!

Tuesday, October 21, 2008

Why Balding People are beautiful?

OK, amid the gloom and doom of this period...Let's let loose abit shall we? SGDividends would like to applaud these 2 fine man in their wonderful leadership during this period. Seriously, they have done well in our opinion.(not sarcastic ok...we are serious..) And look at Paul's watch! It look like a cheapo watch not like the Rolex, Omegas, Patek, IWC watches you see on bankers ( he was from Goldman by the way) Propaganda..maybe..but we don't care as we don't do politics here.

Ok, yes we know, we just got itchy fingers. But we are trying to prove a point. They look ugly with hair. Bald is the new beautiful....seriously. That's gonna be a trend my friends. Anyway, this will definitely go into the BO LIAO stuff on your right. And hey dudes ( meaning Ben and Paul) if you wanna us take this post down, let us know through the comments. We will obey like a dog cos we are shameless and cheap

Ezra...Makes Ezlink cards???????

We went to a beefy barber today and he asked about Ezra Holdings. He said that he is bullish on it and guess what...he thinks Ezra makes the EzLink cards used on buses. Cool...? So for the benefit of our beefcake barber, we decided to write something about Ezra.....anyway its financial statements are relatively recent too (announced in Oct) so why not?

OK....we noted that Ezra issued some notes, so we immediately looked at the interest they have to pay with it ( after the saga of ferrochina's 13% interest!) to check for sanity. 5.285%...Ok pretty reasonable and since its payable on 2011....pretty decent!

Income Statement (ABOVE)

Gross Profit Margin: 29.6%. ( pretty decent baby...muaks)

Net Profit Margin: 12.4% ( ma hu hu in our opinion) Take note that we deducted "Other operating income, net" as we deem it as a one off thingy, not really happening in the normal course of business. See below footnotes about this line item. If we had not deducted this one off thing, it would have skewed this analysis, we think.....

Footnotes (ABOVE)

Balance Sheet ( ABOVE)

Debt Repayment muscle ( like our barber with his rimpling,sexy, hot, veiny, shiny muscle) : CA greater than CL. Current ratio ( Jargon Alert! It just means CA/CL lah)=1.46. ( Sounds pretty good...Mr Beefy Barber you may not know what you invested in but you sure punted right man...)

Cash Flow (ABOVE)


Money in Money out: Cash Flow from operation is positive BUT after deducting purchase of fixed assets, its negative. The Free Cash Flow is negative. We deduct this as based on the footnotes above, it is part of maintaining the normal business of Ezra.

Worth of the Company per share (ABOVE)
Worth of company per share: 63.81 US cents. Last done price on 22 Oct = S$0.6. (Ok cheap......)

Ezra's business is affected by the above factors. (This is taken from the prospectus). So see for yourself how the prospects of this industry is gonna be! Just use some common sense....

And for the sake of our punter barber, Ezra provides offshore support vessels and services for the offshore oil and gas industry, NOT EzLINK cards! ( Damn Citigroup's commercial is really effective....we can't sleep now!)

Important: The objective of the articles in this blog is to set you thinking about the company before you invest your hard-earned money. Do not invest solely based on this article. Unlike House or Instituitional Analysts who have to maintain relations with corporations due to investment banking relations, generating commissions,e.t.c, SGDividends say things as it is, factually. Unlike Analyst who have to be "uptight" and "cheem", we make it simplified and cheapskate. -The Vigilante Investor, SGDividends Team

Monday, October 20, 2008

ST Engineering...Is Engineering a lousy choice in Uni?

As of half time 21/10/2008 , ST Engineering is in the top 20 loser counters. Is it because engineering is dead?(go to to read more, we are refering to a career in engineering, just to clarify)!

Since the last financial statements, they have been winning:

Sounds good to look at....but is it good to eat? Let's us investigate.

Gross Profit Margin: 22.6%
Net Profit Margin: 9.39% ( Do you think its high?)

Debt repayment muscle: CA more than CL @ 1.09

Cheapskateness:NAV at 47cents . Last done price now is: $2.34. ( wah still quite glam sia)

Money in Money out: Cash flow from Operation is positive but Free cash flow is negative. (Net cash from operating activities - purchase of property, plant and equipment)

No wonder Engineers are paid so low...relatively..

Important: The objective of the articles in this blog is to set you thinking about the company before you invest your hard-earned money. Do not invest solely based on this article. Unlike House or Instituitional Analysts who have to maintain relations with corporations due to investment banking relations, generating commissions,e.t.c, SGDividends say things as it is, factually. Unlike Analyst who have to be "uptight" and "cheem", we make it simplified and cheapskate. -The Vigilante Investor, SGDividends Team