COMMENTS ON NEGRI SEMBILAN OIL PALMS BERHAD (2038)
FIGURE 1: NEGRI SEMBILAN OIL PALMS BERHAD LAST 2 YEARS SHARE PRICE TREND
**analysis based on 2018 annual report.
1. GENERAL INTRO: NEGRI SEMBILAN OIL PALMS (NSOP) is one of the main oil palm plantations in Malaysia.
2. NOTABLE POINTS:
a. in 2018 report, reported incurred net loss due to weak crude palm oil prices
b. NSOP owns four estates, with total land banks of ~7682 hectares
c. the Group also has interest in oil palm plantation in Indonesia
3. IS THIS COUNTER A STRONG GROWTH STOCK?
a. REVENUE RANGE (million): ~62.1 million in 2018 annual report, this is a low revenue company.
b. SHARE PRICE: from 2018-2019, share price range between RM3.00 to RM4.00
c. EARNING PER SHARE (EPS): earning per share in last 5 years fluctuated from -5.73 to 13.5sen
d. FUTURE POTENTIAL/PROSPECTS: share price may drop in the next few years if continue to make losses
e. CAPITAL EXPENDITURE (CAPEX): spending on purchase of new fixed assets is RM 7.8 million, around 1% of total assets.
4. IS THIS A STRONG DIVIDEND STOCK?
a. DIVIDEND YIELD: in 2018 financial year, NSOP declared a
dividend payout of 8 sen per share to shareholders despite making
losses. The dividend yield amounts to 2.38% only.
b. CONSISTENCY: consistent dividend payout, last five years
(2014-2018) dividends declared range between 6 to 9 sen per share.
c. DIVIDEND PAYOUT RATIO: from 2014-2018 financial years, NSOP’s dividend payout ratio range from 44 to 136%.
5. IS THE MANAGEMENT PERFORMANCE GOOD?
a. RETURN ON EQUITY (ROE): in 2018 financial year, NSOP
achieved a negative return of shareholders’ equity, at -0.31%, due to
making losses The ROE in last five years ranged from -0.81 to 1.67%.
b. COST-TO-INCOME RATIO: cost-to-income ratio is negative at about -2687%.
6. OTHER INDICATORS:
a. CASH FLOW: cash flow is positive, around RM 70.8 million, equivalent to RM 1.01 per share
b. SUPPORT BY INSTITUTIONAL INVESTORS: this counter is not well
supported by institutional investors, there are only 8 institutional
investors at top 30 major shareholders list, not including EPF,
PERMODALAN NASIONAL BERHAD, SKIM AMANAH SAHAM BUMIPUTERA, KUMPULAN WANG
PERSARAAN, insurance companies and investment funds. Its major
shareholder is TIONG THYE COMPANY BERHAD (55.13%).
http://louisesinvesting.blogspot.com/2019/12/comments-on-negri-sembilan-oil-palms.html
