Posted by Choivo Capital > Oct 18, 2019 6:09 PM | Report Abuse

:)

I bought at 15.1 before Q out, and was thinking of doubling up at 14.7, but kept trying to get more discount.

Haha i'm really not suited for trading. I should just stick to business analysis.

Posted by SilverHawk > Oct 18, 2019 7:21 PM | Report Abuse

Action speak louder than word. Time to buy, buy. Time to sell, sell. Time to hold, hold. 呵呵

Posted by Guilefighter > Oct 19, 2019 3:29 PM | Report Abuse

@StockStalker
Benjamin Graham saying PBV below 0.70 only can buy!! btw aeon cr totally different from bank, cannot compare apple to orange.

Posted by ironcrowz > Oct 21, 2019 10:20 AM | Report Abuse

@StockStalker

I agree with u that during period of uncertainties, buying assets (PBV) is safer than buying earnings (PER).

However, since AEONCR mainly finances some daily necessities like smartphones, motorcycles, and automobiles, i am quite confident in their stability (provided the defaults are controlled)

Its PBV will always (mayb 90% of the time?) be higher than that of bigger banks, simply because it has higher ROA.

Dividends to me are always irrelevant, imagine this, if u 100% own a company, does it matter whether the company pay u dividend or not? If yes, the money is in ur pocket; if not, the money is also in ur pocket since the company is 100% urs.

A dividend paying co is prone to share price being tied closely to DY, limiting share price growth; a non dividend paying co will have its "dividend" reflected in its share price, yet still allow for more speculation gain in share price.

Nice that we all can discuss our investment thoughts here. Have fun investing :)

Posted by Ricky Yeo > Oct 21, 2019 1:48 PM | Report Abuse

Outside of AeonCr topic, one thing I have been thinking for sometime is whether dividend affects valuation.

On one hand, theoretically, dividend doesn't affect valuation. Since valuation comes from all the future cash flow a business can generate aka Operations cash flow minus maintenance capex, so whether a company pays dividend or not is irrelevant.

But on the other hand, dividend does affect valuation. Because of time value of money. The cash receive today is worth more than one received tomorrow. And in a lot of cases, high dividend paying stocks have been valued based on their dividend i.e dividend growth model. And it also seems to be the case that dividend paying stocks do trade at a higher multiples.

So something interesting to think about.

Posted by gongkia > Oct 22, 2019 8:43 AM | Report Abuse

is not dividend doesn't affect valuation, dividend is part of the earning, and it is already reflect on the valuation.

so adding dividend to valuation is double counting.

Posted by Ricky Yeo > Oct 22, 2019 10:06 AM | Report Abuse

You're right in that sense. But still people who use DDM factor dividend into valuation.

Posted by ironcrowz > Oct 22, 2019 10:39 AM | Report Abuse

Hmm I think i simplified things a little too much, i should make it clear..

Dividend does affect valuation. It affects the compounding rate of the company's value. If no dividend is paid (100% earnings is retained), and if the company can reinvest them for growth, then the company's value will compound faster than another company that pays 60% earnings out as dividends, since it only left with 40% earnings to be reinvested for future growth.

Not sure how time value of money will effected in this case. If received dividend now, the money received worth more now, if don't receive dividend now, the money reinvested will compound the company's value. Maybe the TVOM effect will offset? Maybe the compounding rate will surpass the discounting effect?

High dividend payout ratio stocks usually are large and stable companies (if otherwise, most likely they have established consistent dividend record), hence usually they attract investors looking for dividend. Now, if u r investing for dividend, u look at the dividend yield right? So if 6% dividend yield is good enough for u, you will happily buy at PE 16.67, some may even think 5% is good enough, higher than FD already, so again happily buy at PE 20. So a higher PE is not unusual.

Posted by SilverHawk > Nov 12, 2019 1:19 PM | Report Abuse

The worst is over for Aeoncr

Posted by xiaotee > Nov 12, 2019 9:40 PM | Report Abuse

Silverhawk: Hope so, but why do you think so? Wouldn't the MFRS 9 accounting depress the net income for at least 12 months?

Posted by chl1989 > Dec 4, 2019 8:45 AM | Report Abuse

back to rm10 la. 2 more red quarters :)

Posted by Choivo Capital > Dec 4, 2019 10:30 AM | Report Abuse

Its not the adoption of MFRS9 here, its the change in assumptions in calculating their ECL.

====
xiaotee Silverhawk: Hope so, but why do you think so? Wouldn't the MFRS 9 accounting depress the net income for at least 12 months?
12/11/2019 9:40 PM

Posted by xiaotee > Dec 5, 2019 10:24 PM | Report Abuse

Thanks for the great insights into dividends relating to valuation.I venture a reason why such stocks tend to be given better and added valuation. A company regularly paying dividends communicates it's caring for it's minority shareholders and just management. Even better if the dividend yield matches the common bank FD rates and is sustainable. Growing dividend yields further communicate that net earnings are growing and hence the stock gets a higher rating by it's shareholders. Not giving any dividends/ only giving a miserable dividend yield year after year in spite of healthy growing retained earnings only arouse suspicions that the controlling shareholders are up to no good, and they could be planning privatisation exercises at a low price to it's true value. Yet such exercises would be usually be approved albeit with comments like the offer price is "unfair" but "reasonable" - in actual fact the minority shareholders get shortchanged of their true share of the stock! Hence the many "value traps" in Bursa - it actually becomes irrelevant to count their true value because the controlling party has no intention of sharing the fruits equitably with the minority party!

Posted by Ricky Yeo > Dec 6, 2019 11:35 AM | Report Abuse

That's only true up to a certain extent. A great example is Berkshire, Berkshire never pays a single cent of dividend in their history 40+ years, yet Berkshire don't trade at a 'cheap' price i.e below NTA, mainly because they have managed to compound return at a rate higher than index fund.

On the flip side, distributing large portion of earnings as dividend isn't necessary a good thing either because if the company has the ability to reinvest more into the business and generate a high incremental return, that is, higher than what a common investor can find in the market, then that is a bad investment decision. Although this is far harder to assess.

But you're right that companies with a strong dividend record tend to garner higher valuation than one that doesn't.

Posted by gongkia > Dec 6, 2019 1:15 PM | Report Abuse

comparing pbv between a high growth aeoncr to the low single digit growth of general banks is not meaningful.

Posted by SilverHawk > Dec 19, 2019 7:25 PM | Report Abuse

QR seen improving.
Interest expense / revenue ratio up 0.81% maybe implying lower profit margin on M40 segment.

QR slowly back to normal as impairment loss narrowed down on sizeable amount.

No more downwards pressure.
Up swing ? Just see how market read the report.

Posted by Kpin Yeoh > Jan 14, 2020 2:40 PM | Report Abuse

You need hold this for the next 6 month to see profit. The business model is very simply this could be the easy way to make money. Projected to back to 16 by mid of this year.

Posted by gongkia > Jan 14, 2020 2:50 PM | Report Abuse

where is another point where u all gonna buy again?

Posted by SilverHawk > Jan 14, 2020 8:30 PM | Report Abuse

13.50, a "close eye buy" price. Company is still growing and growing very solidly. Nothing changed except MFRS 9. Time will tell. Only uncertainty is : timing can't be predicted 。。。

Posted by yoyo > Jan 15, 2020 2:40 PM | Report Abuse

but normally people advice not to catch a falling knife

Posted by Freedom123 > Jan 16, 2020 4:51 PM | Report Abuse

I hope SilverHawk is right...

Posted by Freedom123 > Jan 16, 2020 4:53 PM | Report Abuse

I dont see why share price is so significantly impacted by MFRS 9. It's just accounting treatment. But other banks are not much affected. Even RCE / MBSB are not much affected by MFRS 9.

Posted by SilverHawk > Jan 16, 2020 5:22 PM | Report Abuse

1. MFRS 9 was introduced when Kenji still around. He was with the company for long and know well company operation. Impairment provision need huge subjective judgement. So, the QR is within the range when Kenji is around.
2. The first QR new CEO took over, suddenly QR huge down by huge impairment. Reason : a) new CEO follow strictly on MFRS 9 and press hard on the brake. b) maybe to sweep away the dirty shit left by ex CEO. c) he is not so familiar with the new game rules
3. But from the Q3 FY 2020, ie the second quarter new CEO in office, the provision has cut short with 40M. He will slowly get use to company operation and make things normal again.
4. New accounting rules won't kill a company, except the company with fake accounting practices.
5. Next QR, high possibility the company will post a profit of 100M, the profit level it suppose to be.
6. When things normalised and the growth still intact, FY 2021 QR, it shall be , and hopefully, the QR will have profit of 100M level.
7. Market is irrational, short term fluctuation is by demand and supply of the liquidity. When we have desperate seller , then we need to wait till they finish dispose.
8. I still remember Allianz posted good QR last year ( or 2018 ) the market also can press the price down till 11.80. haha, a big frog jump from the sky.
9. Hope Aeoncr is also the same case.

Posted by pputeh > Jan 18, 2020 10:16 PM | Report Abuse

Price has been steadily falling from rm16.00 Oct 2019 to 13.40. Jan 2020. Bleeding

Posted by PuppyKitten > Jan 20, 2020 10:17 AM | Report Abuse

Price drop is good for accumulator. Price up is good for existing holder

Posted by ironcrowz > Jan 21, 2020 11:33 AM | Report Abuse

https://www.businessinsider.in/a-new-rule-that-warren-buffett-calls-a-nightmare-led-to-berkshire-hathaways-first-loss-in-9-years/articleshow/64044001.cms

Buffett has called the new rule a "nightmare" that would produce "truly wild and capricious swings" in bottom-line results that could, depending on the direction, unnecessarily scare or embolden investors.

The same thing we going through now, unrealised losses on equities = expected default rate on loans.

Posted by AnDavis > Jan 21, 2020 5:08 PM | Report Abuse

There is actually a hidden gem in the financial sector in terms of PBV. MNRB, the national reinsurer is currently trading at PBV 0.3, which I think is significantly undervalued. It fully matched Benjamin Graham's definition of value stock.

Posted by 1288 > Jan 21, 2020 7:20 PM | Report Abuse

https://www.ram.com.my/pressrelease/?prviewid=5214 RAM Ratings assigns AA3 and A1 ratings to AEON Credit’s proposed Senior and Subordinated Sukuk Wakalah

Posted by remus > Jan 22, 2020 3:37 PM | Report Abuse

OPR reduced to 2.75%. Good or bad to AEON CR? can reduce their borrowing cost?

Posted by Freedom123 > Jan 22, 2020 10:25 PM | Report Abuse

Is aeon credit NPL ratio better than banks? Or worse than banks?