After I have seen these foolish investors as shown below who were boasting about their sale of Dayang on i3investors forum, I have to write this useful lesson.
The price chart shows that Dayang has gone up from 50 sen to close Rm 2.85 yesterday, an increase of 570% within 1 year. As I often said, no stock can continue to go up or come down for whatever reason. After some time, it will change its price trend line.
Even expert chartists do not believe it
Unlike many other stocks, Dayang’s price corrections are always very small. During these 12 months, many foolish investors in anticipation of buying it back at cheaper prices. Now they are in a dilemma because the price continues to go up higher and higher. They are regretting for their mistake.
Willing to eat a humble pie
Unless they are prepared to eat a humble pie, they will miss the golden opportunity to make a lot of money because Dayang will continue to go up higher and higher for many more years to come.
A few days ago, I saw 1 rich investor queuing to buy 2.6 million Dayang shares at Rm 2.50 and someone queuing to sell 31,100 shares at Rm 2.51 at the close of today’s trading.
The big buyer was from UBS Securities which has its HQ in Zurich. This can only mean that the price will continue to go up high and higher and all those investors who sold earlier cannot expect to buy back at cheaper prices.
Petronas will not stop pumping oil
Even if the petroleum price dropped by drastically, Petronas will still continue pumping oil because the cost for just pumping is very small. Petronas has already paid billions of Ringgit for the construction of oil rigs or oil platforms. It is still very profitable to just pay for pumping and selling the oil.
If you google you can see that the average cost for an off shore oil rig is US$ 650 million which is like a city and they all need maintenance and repair.
Dayang is the largest maintenance contractor in this region where Petronas has discovered a total of 163 oil fields and 216 gas fields. That is why Petronas continues to award more maintenance contracts to Dayang.
On 22nd Nov the company announced its 3th quarter result. Both its profit and revenue have improved.
1st quarter eps -0.43 sen, revenue Rm 156 million
2nd quarter eps 5.71 sen, revenue Rm 247 million
3rd quarter eps 11.10 sen, revenue Rm 357 million
Since it has resolved its financial constrain by its recent right issues, its 4th quarter result should be better than its 3rd quarter. Based on its profit growth rate of the last 3 quarters, from – 0.43 to 5,71 to 11.1 sen, its 4th quarter should be more 15 sen. The total for the year will be more than 30 sen per share. Since it has such a rapid profit growth rate, it deserves to sell at above P/E 12. My immediate target price is Rm 3.60.
Dayang’s prospect in 2020
It is safe to assume that Dayang will perform better this year than last year after it has resolved its financial constrain and also it has gained more experience. My target price for this year is above Rm 4.00 per share.
Dayang has very good profit growth prospect which is the most power catalyst to move share price higher and higher.
In the last few months I have been searching for another stock with similar qualities as Dayang in vain.
As a co- founder of Ipoh Garden Bhd. (IGB), in the early 1960s when we offered to sell 100 houses, we always had a few hundred buyers. We had to ask the Perak Mentri Bersar to draw lots to select the lucky buyers. It was like IGB had the monopoly to sell houses.
Dayang is now in a monopolistic position
Chart | Stock Name | Last | Change | Volume |
---|
Created by Koon Yew Yin | Sep 06, 2024
Water pollution is a huge challenge for freshwater in the UK, impacting our rivers, streams, and lakes and the wildlife that call them home.
Created by Koon Yew Yin | Sep 03, 2024
State housing and local government committee chairman Datuk Mohd Jafni Md Shukor said demand for properties in Johor has gone up since last year’s announcement about the SEZ.
Created by Koon Yew Yin | Aug 30, 2024
KSL announced its total 4 quarter EPS of 42.3 sen and its net tangible asset (NTA) backing of RM3.86. It is selling for less than 50% of its net tangible asset (NTA). KSL is undervalued. Its share...
Created by Koon Yew Yin | Aug 26, 2024
In 2012, I wrote my first book “Malaysia: Road Map For Achieving Vision 2020” which was launched by former Financial Minister Tengku Razaleigh.
Created by Koon Yew Yin | Aug 26, 2024
On 21st Aug 2024, I posted my article with the title “90% of investors lose money in the stock market”. Now I will tell you how to make money from the stock market.
Created by Koon Yew Yin | Aug 26, 2024
A few years ago, one relative asked me to invest for him. I told him to let one famous professional fund manager manage his life saving. I cannot mention his name. He teaches Technical and Financial..
Created by Koon Yew Yin | Aug 19, 2024
On 14th Aug 2024, I posted my article “Why people are rioting across UK”. Now I want to tell you why do people riot?
Created by Koon Yew Yin | Aug 19, 2024
If I knew politicians are so well paid, I should have been a politician. A few days ago, one old friend who migrated to Australia about 40 years ago, visited me. He told me that he was a Member of P..
Created by Koon Yew Yin | Aug 14, 2024
Riots have spread across numerous cities and towns in England, and in Belfast in Northern Ireland, over the last week in the worst outbreak of civil disorder in Britain for 13 years. Police have ma...
Created by Koon Yew Yin | Jul 30, 2024
The new poll, conducted between July 22-24 and released Sunday, found that Harris’s approval rating had surpassed Trump’s in Wisconsin, Pennsylvania, Minnesota, and Michigan. In Michigan, Harris was..