Saturday, February 27, 2021

A review of my company prospecting process: More hits than misses

Less than a year ago, after a screening process, I highlight 4 companies

https://sillyinvestor.blogspot.com/2020/05/company-prospecting-process-maxi-cash.html

Of the 4 companies, Maxi-cash, Muti-chem, Hotung, and Overseas Family education,

I only invested in Hotung. 

Maxi-cash and Muti-Chem gives capital gain of 50% and 70% had in invested in them, and Hotung, just 15%, excluding dividends. 

What went wrong? I think I have current yield bias, and aversion to company with high loan to equity ratio. Could I have done better? I am not sure. I guess missing out on gains is better than holding on to losses.

I predicted improving dividends for 3 counters in blogpost here

https://sillyinvestor.blogspot.com/2020/12/merry-chiristmas-here-are-3-companies.html

Of the three, YZJ kept is earnings intact, Kayhian did increase it, and Verdict is not out yet on CSCP. Companies that pay out dividends as a ratio of earnings could see higher volatility of dividends but it might made timing the turnaround more rewarding. BAE system also guided on 50% payout, and with improving earnings (Projected), I hope to repeat the success of it. 

Third, using Free cash flow yield

https://sillyinvestor.blogspot.com/2020/12/merry-chiristmas-here-are-3-companies.html

1) Lung Kee (HK 0255) (15%)

2)Yangzijiang (13%)

3) Lonking (HK3339) (13%)

4) *Diary Farm International (13%)

Closely followed by Silverlake Axis and Singpost in the 8-9 % range.


In terms of capital gains, with exception of lonking, all are in the range of 10%, DFI and Silverlake are loss making and I have exited SIlverlake after they suspended dividends in 1H.

I recently also found another company 0819 TianNeng Power with FCF in excess of 10%, PE in the range of 10, in the sector of making batteries for EV and etc. An growing company in a growing industry should deserve better valuation and due to the min lot size of 2000 shares, it is my biggest HK purchase. However, I am already 10% underwater. 

FCF yield need longer runway before they can appreciated by market? 

The better counters, such as SATS(>50% gain), has nothing fundemental improving, although the outlook is defintely better. 

The concluding thought I have, is hence:

I really hope to count on luck, and hence diversification is important. After I sold off Silverlake, non of my counters hold more than 5% in my portfolio. In fact, most of then are in the 2-3% range. 

Hence, although i do have some counters than are gaining 70% or 50%, as a portfolio, it is just 6% gain based on COST. 

Hope I continue to be lucky. 

 

3 comments:

  1. NBSE 12th Model Paper 2021 Pdf Download for Nagaland Board HSSLC/STD-11/STD-12 Question Paper 2021 with Answers for Arts, Science, Commerce stream Theory, Objective, and MCQ Questions for Paper-1, Paper-2 exam Solved Question Paper with IMP Questions 2021 Nagaland 12th Model Paper 2021. School Education Board of Nagaland (NBSE) has announced the state class 11th and 12th standard or level model sample question bank for the general and vocational course higher secondary school leaving certificate (HSLC) students of Arts, Science, Commerce stream students to the academic year of 2021.

    ReplyDelete
  2. DO YOU NEED A LOAN?
    DO NOT KEEP YOUR FINANCIAL BURDEN TO YOURSELF CONTACT US NOW FOR ANY KIND OF LOAN AT A LOW INTEREST OF 2%. stevewilsonloanfirm@gmail.com whatsapp: +14027300344,

    Our loans are well insured for maximum security is our priority, Our leading goal is to help you get the service you deserve, Our Loan program is the quickest.

    We give out loan in any currency of your choice Yuan, Dollar, Thai baht, Euro, Lira, etc} and duration of 1 to 30 years to pay back the loan (secure and unsecured).
    Do you need any kind of loan and have low credit score, Have you find it difficult to get loans from local banks and other financial institutions? solution to your financial problem is STEVE WILSON LOAN FIRM.

    The terms and conditions are very reasonable and considerate.
    We offer a wide range of financial services which includes: Xmas Loans, Business Loans, Debt Consolidation Loans, Personal Loans, Car loans, Hotel loans, Student loans, Home Refinancing Loans with low interest rate @2% per annul for individuals, companies and corporate bodies.

    Interested applicants should Contact us via email:stevewilsonloanfirm@gmail.com. whatsapp:+14027300344 Apply and be free from financial bondage.

    ReplyDelete
  3. HELLO, I am Rebecca Michaelson by name living in Europe. Here is a good news for those interested. There is away you can earn money without stress contact (THOMAS FREDDIE) for a blank [ATM CARD] today and be among the lucky once who are benefiting from this cards. This PROGRAMMED blank ATM card is capable of hacking into any ATM machine anywhere in the world. I got my master card from a good Hacker on the internet, with this ATM Card I am able to collect $5000 dollars every day via contacts:
    +1 (985) 465-8370 {thomasunlimitedhackers@gmail.com}
    I was very poor but this card have made me rich and happy, If you want to get this opportunity to become rich and establish your business then apply for this Master card, I am so happy about this because i got mine last week and I have used it to get $240,000.00 dollars from THOMAS FREDDIE UNLIMITED Hackers is giving out the card just to help the poor and needy and they ALSO OFFER FINANCIAL ASSISTANCE. get yours from THOMAS FREDDIE UNLIMITED HACKERS today. Kindly contact them by Email thomasunlimitedhackers@gmail.com

    Thank You and God bless

    ReplyDelete