Hi guys/gals,
Now Calvin would like to share a little more on a Cyclical Stock called L&G.
L&G has 3 main Focus
1) REAL ESTATE
2) Oil Palm & Rubber Cultivation
3) Education
Education is non cyclical and recession proof. So teachers' jobs are secured. Especially those working in Govt School.
Oil Palm/Rubber are some what cyclical.
The Major Part of L&G Business is in Real Estate. And Real Estate is a cyclical business.
Other Cyclical Businesses are
1) Prestar (Usually during Election Time Govt will dish out Major Infrar Highway Jobs to win votes) So Prestar's Guard Rails will do roaring business when Major highways are built.
Then was why Calvin called for an early buy on Prestar at 46 sen.
Same goes for Masteel at 66 sen due to Long Steel being needed for highways and MRT
2) Stock Brokering like INSAS
When Election time comes & during Market Bull run time more traders will come and join the party. So INSAS, TA, Hwang & Other Brokering Firm will do well. That was why Calvin called for a buy on INSAS at 65 sen
3) Real Estates Stocks
Yes, this one also Cyclical. And L&G is one of them. When Stocks of property meet good times - Sales go up & profit increased.
For L&G out of last 4 quarters One Quarter Did exceptionally well when it has niche properties for sale.
Just like Ski Resort. Business is good only one season during winter.
So let's take another look again at this One Quarter Result of L&G
From 31 March 2016 Results you can SEE that
REVENUE is Rm184,194 millions
Out of the Rm184 millions revenue L&G garnered a Gross profit of Rm76.039 millions
How much gross profit by percentage?
Let's divide Rm76.039 millions by Rm184.194 millions
= That's 41.28%!!
At 41.28% L&G beats many other Real Estate companies. It even beats many construction companies including PTaras Jaya. And it even beat construction material compaies which are also cyclical in nature. Of course superstock like KESM can generate a gross profit of 70% to 80% (But these are rare indeed!)
From this one quarter profit alone L&G has already generated a profit of 5.03 sen
And 5.03 sen profit means a P/E of 4.17 or growth of 23.9%
So you must not and should not see or judge cyclical stocks by just one or 2 quarters results.
If just One Quarter out of every 4 Quarters every year is doing exceptionally well - the stock is worth our attention.
It was said in Penang Island of Malaysia that One Type of Business depend entirely on just one month's sale.
They only do one month's business every year & can take holiday for the next 11 months.
What kind of business is that? you may ask?
It's selling "incense & joss sticks & paper articles like paper houses, paper cars, paper TV and what not which they burn for the dead"
They made an awful lot of monies selling these superstitious stuff! (Of course Calvin being a Christian does not endorse this superstitious waste of time and money!)
But this is one way of illustrating how a cyclical business operates.
Now coming back to L&G
it has just acquired 4 Assets recently.
Even if L&G separates these 4 new Acquisitions into new projects for 2, 3 or 4 years - their expertise of garnering high profit is assured.
That's why Calvin is bullish.
Extra bulllish as price has fallen to very attractive level now.
Buying L&G now at 21 sen now near Rock Bottom is buying below Calvn buying price, below L&G Directors & Insiders buying price. Buying before Sifu Tan Chong Koay buying price. Buying below savvy Investor Lim Pei Tiam buying price.
YESS!
Last time Calvin's Johor Sifu told Calvin to buy Pintaras Jaya at Rm1.40 when he saw Insiders of Ptaras exercising ESOS at Rm1.90. And also one PTaras Dr. Boss buying Ptaras Shares at Rm1.90 from the open market. If Directors of Ptaras dare to buy at Rm1.90 it is certainly safe for us to buy at Rm1.40.
As it turned out Ptaras Jaya powered up to Rm7.00 & split (Up 500%)
And same goes for L&G.
Success is repeated again and again.
May all Invest wisely,
CHEERS
Calvin Tan
Singapore
Now Calvin would like to share a little more on a Cyclical Stock called L&G.
L&G has 3 main Focus
1) REAL ESTATE
2) Oil Palm & Rubber Cultivation
3) Education
Education is non cyclical and recession proof. So teachers' jobs are secured. Especially those working in Govt School.
Oil Palm/Rubber are some what cyclical.
The Major Part of L&G Business is in Real Estate. And Real Estate is a cyclical business.
Other Cyclical Businesses are
1) Prestar (Usually during Election Time Govt will dish out Major Infrar Highway Jobs to win votes) So Prestar's Guard Rails will do roaring business when Major highways are built.
Then was why Calvin called for an early buy on Prestar at 46 sen.
Same goes for Masteel at 66 sen due to Long Steel being needed for highways and MRT
2) Stock Brokering like INSAS
When Election time comes & during Market Bull run time more traders will come and join the party. So INSAS, TA, Hwang & Other Brokering Firm will do well. That was why Calvin called for a buy on INSAS at 65 sen
3) Real Estates Stocks
Yes, this one also Cyclical. And L&G is one of them. When Stocks of property meet good times - Sales go up & profit increased.
For L&G out of last 4 quarters One Quarter Did exceptionally well when it has niche properties for sale.
Just like Ski Resort. Business is good only one season during winter.
So let's take another look again at this One Quarter Result of L&G
SUMMARY OF KEY FINANCIAL INFORMATION
|
|
INDIVIDUAL PERIOD
|
CUMULATIVE PERIOD
|
||||
|
CURRENT YEAR QUARTER
|
PRECEDING YEAR
CORRESPONDING QUARTER |
CURRENT YEAR TO DATE
|
PRECEDING YEAR
CORRESPONDING PERIOD |
||
|
31 Mar 2016
|
31 Mar 2015
|
31 Mar 2016
|
31 Mar 2015
|
||
|
$$'000
|
$$'000
|
$$'000
|
$$'000
|
||
| 1 | Revenue |
184,194
|
56,368
|
342,061
|
465,366
|
| 2 | Profit/(loss) before tax |
76,039
|
6,436
|
127,344
|
192,338
|
| 3 | Profit/(loss) for the period |
53,083
|
1,988
|
91,765
|
143,414
|
| 4 | Profit/(loss) attributable to ordinary equity holders of the parent |
54,982
|
7,096
|
95,050
|
105,428
|
| 5 | Basic earnings/(loss) per share (Subunit) |
5.03
|
0.67
|
8.75
|
11.93
|
| 6 | Proposed/Declared dividend per share (Subunit) |
0.02
|
0.02
|
0.02
|
0.02
|
|
AS AT END OF CURRENT QUARTER
|
AS AT PRECEDING FINANCIAL YEAR END
|
||||
| 7 | Net assets per share attributable to ordinary equity holders of the parent ($$) |
0.6385
|
0.5823
|
||
From 31 March 2016 Results you can SEE that
REVENUE is Rm184,194 millions
Out of the Rm184 millions revenue L&G garnered a Gross profit of Rm76.039 millions
How much gross profit by percentage?
Let's divide Rm76.039 millions by Rm184.194 millions
= That's 41.28%!!
At 41.28% L&G beats many other Real Estate companies. It even beats many construction companies including PTaras Jaya. And it even beat construction material compaies which are also cyclical in nature. Of course superstock like KESM can generate a gross profit of 70% to 80% (But these are rare indeed!)
From this one quarter profit alone L&G has already generated a profit of 5.03 sen
And 5.03 sen profit means a P/E of 4.17 or growth of 23.9%
So you must not and should not see or judge cyclical stocks by just one or 2 quarters results.
If just One Quarter out of every 4 Quarters every year is doing exceptionally well - the stock is worth our attention.
It was said in Penang Island of Malaysia that One Type of Business depend entirely on just one month's sale.
They only do one month's business every year & can take holiday for the next 11 months.
What kind of business is that? you may ask?
It's selling "incense & joss sticks & paper articles like paper houses, paper cars, paper TV and what not which they burn for the dead"
They made an awful lot of monies selling these superstitious stuff! (Of course Calvin being a Christian does not endorse this superstitious waste of time and money!)
But this is one way of illustrating how a cyclical business operates.
Now coming back to L&G
it has just acquired 4 Assets recently.
Even if L&G separates these 4 new Acquisitions into new projects for 2, 3 or 4 years - their expertise of garnering high profit is assured.
That's why Calvin is bullish.
Extra bulllish as price has fallen to very attractive level now.
Buying L&G now at 21 sen now near Rock Bottom is buying below Calvn buying price, below L&G Directors & Insiders buying price. Buying before Sifu Tan Chong Koay buying price. Buying below savvy Investor Lim Pei Tiam buying price.
YESS!
Last time Calvin's Johor Sifu told Calvin to buy Pintaras Jaya at Rm1.40 when he saw Insiders of Ptaras exercising ESOS at Rm1.90. And also one PTaras Dr. Boss buying Ptaras Shares at Rm1.90 from the open market. If Directors of Ptaras dare to buy at Rm1.90 it is certainly safe for us to buy at Rm1.40.
As it turned out Ptaras Jaya powered up to Rm7.00 & split (Up 500%)
And same goes for L&G.
Success is repeated again and again.
May all Invest wisely,
CHEERS
Calvin Tan
Singapore
http://klse.i3investor.com/blogs/www.eaglevisioninvest.com/127640.jsp
