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Author: Tan KW   |   Latest post: Mon, 21 Oct 2019, 8:45 AM


Buy Armada, Sell Gamuda - felicity

Author:   |    Publish date:

Tuesday, February 19, 2019

For the last 1-1/2 months, Bumi Armada has been a highly traded stock, which is probably unusual considering that it used to be a Composite stock. On a daily basis, its volume can go as high as 500 million stocks traded, i.e. almost 9% of its 5.871 billion issued shares. This shows that there are a lot of traders and speculators with probably syndicates involve in the stock.

When this happens, usually the fundamentals are out of whack. At the moment, there is a tense situation concerning its short term fundamentals and among the analysts even they could not agree closely on the valuation of the company among themselves. The UOB Kay Hian analyst gave a 10sen valuation for Bumi Armada whereas the CIMB analyst gave a 71 sen valuation for the company.

Basically, for me if the UOB's valuation is correct it basically can almost call for bankruptcy or almost liquidation for the company as one of the major concern for Armada is its short term liquidity.

I had written a piece on the stock, and I have less fear over its short term liquidity. I think it is something that can be addressed, which is why I am more inclined towards the analysis provided by CIMB. Hence, I have made a 25,000 units purchase of Armada for the fund and at the same time Sold Gamuda. If one can remember, when I bought Gamuda few months ago, it was also probably out of whack in terms of its pricing for a very good company. The almost termination (underground portion) of MRT2 for Gamuda caused selldown on the stock. It was lingering at around RM2.30 to RM2.45. Now it has gone up and I am taking profits although I do think it will continue to go up.

At the moment, in my opinion, many of the stocks are attractive hence giving me difficulties to pick stocks. With Bumi Armada, I am taking opportunity of its volatility and selldown which I think is wrongly sold especially when it has become a traders stock.

I think over the long run, it will readjust itself, hence I decide to take a small purchase of the stock.


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Labels: ARMADA

Related Stocks

Chart Stock Name Last Change Volume 
ARMADA 0.445 0.00 (0.00%)

  ramada likes this.
19/02/2019 1:31 PM
Armada An Quantum Leap Stock In 2019/2020 felicity always my favorite , maybe its time i look at the detail for armada.
19/02/2019 1:36 PM
qqq3 wow....not scared what " bankers giving cold shoulders to refinancing "
19/02/2019 1:51 PM
speakup we are in a Bull Run.....
in a Bull Run.... ever shit company performs!
19/02/2019 2:07 PM
cheoky Surprised. What is the investment decision to buy into Armada? Share price attraction as the only reason? What if they are incapable to bidding for new projects due to debt ceiling limit already not withstanding debt rollover. All new project requires new debt to kick off.
19/02/2019 2:10 PM
tokohM felicity, sure buy
19/02/2019 2:15 PM
Sniper86 I like to read Felixity's posts.
19/02/2019 4:40 PM
ramada Good writing style.
19/02/2019 7:52 PM



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