Ripe for a correction

The real qustion is, is it better than the 'other' furniture company...

Sell la...korean investor comes in...they just need to control the company with 31%, then work Century to the ground and in years to come will have very low profits, then strip it of all its value because USD $43.17mil is peanuts for them

At FCF12mil, no growth, 10% discount rate, IV is 1.16.

Keep holding la

You nincompoops just know how to plug in numbers into your models but dont actually know how these things work.

Company A's reinvestment, assuming your growth is the same 10%, will be $121 at year 2, due to COMPOUNDING.

Company B will forever be the same, assuming no growth as you did below.

Clearly, growth > no growth.

Jeezus if you 'FUNDAMENTAL INVESTORS' dont know anything, please dont espouse your lack of knowledge on the internets. At least go verify with your sifu kcchongnz before you post. thanks

QUOTE:
Ricky Yeo: I will debunk your myth now.

Company A
Year 1: Revenue $100, Profit $10 (10% margin). Reinvest 100% (or $10)
Year 2: Revenue $110 (10% growth), Profit $11 (10% growth).

Company B
Year 1: Revenue $100, Profit $10 (10%). Reinvest 0% (or nil)
Year 2: Revenue $100 (0% growth), Profit $10 (0% growth)

So in example above, im sure you will love company A over B, and A worth more than B, but can that be true?

If you are an owner of A, year 1 net cash flow is $0, because you reinvest everything to buy machines, yes you get a 10% growth in year 2, but your return is still the same for both years. 10%!

If you are an owner of B, there is no growth for year 2, but year 1 you have cash flow of $10, you CHOOSE not to reinvest the capital and declare dividend, all $10 back to shareholders.

So when someone say growth is better, they forget that growth doesn't come from thin air. You need capital to grow. Where do you get capital? From profit of course. So if profit, or return is the same for A and B, which is 10%, why should A worth more than B?

A is only worth more than B WHEN the capital reinvested can generate a higher return, in this case above 10%.

If A decide to reinvest and earn 5% return instead of 10% like in year 1, is growth good?

TP2.0, forward pe 6

All you vested shareholders commenting on Value Investing and defending this stock on every goddamn Fundamental metric (and Fundamental investing is a long game, a rather long one indeed), why in gods name are you arses commenting and defending your stock on a daily basis? It drops? Stay quiet, in fact encourage it to drop further, then sell your house, your parents, your pants and buy more!

1. The fact is, if you nincompoops did proper checks, you'd realise that a certain shareholder who has ceased to be a major shareholder just recently (there's a hint for you), has in fact not the stated 5%, but almost 10mil shares including parties acting in concert, from the TOTAL ISSUED shares of 103mil, thats 10% for those of you slower in the brain. Im not even going to go into how much 10mil shares is as a percentage of free float.

2. And we all know, this shareholder is no long term investor, this person is a trader. And when an exit occurs, it will be fast, and furious, and oh so painful. And yes, say what you like, this trader, like the better ones out there, is not afraid to 'cut loss', take a big hit, and move to another target. After all, its all profits made in the past.

Now tell me, does your XYZ 10% dividend yield look all that nice in the face of massive capital losses? Sell now and save your seefatlong - and thats how you teach the speculator a lesson

Koon's intention is never to hold it long or until maturity, just all his other stocks...somewhere along the 5 years Gamuda will go up, perhaps even higher than exercise price of the warrant, and then he'll unload. Make sure youre out way before then

RM1.20, forward PE of 6x

ceteris paribus, a price higher than market, the buyers see more value in the firm than the market...if lower price, then you need to worry ;)

Sostomatofinance is it, invested capital IC is not calculated like that

Director's gonna sell until the fat lady sings hahahah

Come on Chong, you can do better. Tell us something we don't already know.

Since the rest of the posters here have IQ's of everyday people, progress will depend on people who are looking down on these sucjects.

1. At what point does one sell. When it reaches your IV, when it exceeds IV by 20/50/100%? Or never? Now that old man, is a question for the ages.

You guys are hilarious. Latest qtr profit only rm4mil la, annualised only rm16mil. P/E is already 10 la currently, which is high, please dont quote me similar PE, other industry etc thats bollocks historically its always been 5-7. Good luck you guys are gonna need it

Binapuri, KKB, WCT all small-mid caps won...this one go holland

Other construction firms all announced pan borneo project wins...this one still.........if only they can win that would be the catalyst, turn around year + india cod + ???

Its all rather tiring kcchong. Everyday its about harping the same old stories, "im better, backed by research" bla bla bla.

Look, we know. FA works. We know

You could have been so much more. Instead you chose a path of mediocrity.

Spouting useless articles 'defending' your methods, 'answering' all the detractors when we all know its just a pitiful attempt to drum up interest in your course.

Do you see any of the value investing guru's touting their courses? Nay.

So much more, yet you chose the path of mediocrity. Wisdom is wasted on the old. You would think the old would want to leave a legacy, but nay, they want your small fees. A pity, really.

Post removed.Why?

Dumb asses....the only winners in the airline business is Boeing and Airbus and the airports

You old farts and wannabes should know your place. Stay in the kitchen and let the real investors show you the way

Hahahah you guys are hilarious

Those that take part lose less than others and think its good

And then there's some who aren't even in the competition who are making noise

The better comparison would be in Property/Real Estate returns in Malaysia (or the USA if no choice). Gold and Bond are not available to your 'average' Malaysian investor. Should have thought of that when you made wrote the article

So now the Greenblatts formula has been butchered to CY and CROIC

Show your cash flow calculations and assumptions la

You guys are all losers

You're just jealous of another writer's popularity. Get a life and focus on picking winning stocks

I've gone through the picks http://klse.i3investor.com/blogs/stock_pick_2016/89039.jsp and they are all boring. All alike, same theme, hyped up etc etc.
Let me show you what a contrarian pick looks like, and we shall see at the end of 2016 who is a god

Coastal
Dayang
Deleum
Favco
Gadang
JCY
LTKM
OKA
TEOSENG
TURBO

And yes, you can use the closing prices as of today 4 Jan 2016 as reference.
Good luck guys, you're gonna need it

I have to respectfully decline this year. All you guys are short term traders. I've even contacted KCChong for a longer term initiative, especially for the betterment of the i3 community. Fundamental investing is the only way forward. But once again, thanks for your invitation, it was fun. And thanks to all the forummer who doubted me. You have only made me stronger.

Don't get emotional old man

You traders are weak

2.) In current state Padini has the very slight advantage in profit margins.

As I said, new players will always incur huge costs. 11% for a business that has had so many years of advantage is appalling.

3.) There is heavy competition in the retail industry. Apart from Padini & Uniqlo, there's also H&M, Zara, Giordano, Cotton On, Mango, G2000, Voir, Kitschen and many many more. Each caters to their own customer needs and wants.

Exactly, you said it yourself. They will only suffer.

Stick to the facts and look at the trend, since 5 years ago not do a comparison since last year. Also for Uniqlo using Wing Tai's numbers. Then you shall see. 3 years is not a long time, and then it is all the way down hill. The only recourse is that you get 6% dividends - the next question would be how much erosion in share price and MOS are you willing to take on, to still get your required IRR. Not much I reckon

You own the stock, that's a bias, and you see what you want to see.

Padini only survives because it is in the smallest towns. And they have been in MY for how long? Uniqlo is an infant, and already its revenues are almost 50% of Padini. And its Margins? IT has expanded so aggressively, its amazing it is making money - of course, like I mentioned earlier, its margins are superior, bar none.

VAlue investing is for the long term and in 3-5 years, Padini is already in decline, and in 5 years it will be far worse.

Good luck holding

Traders faster take profit b4 3Q announcement...lightweights

The ability of a business to control its prices and thereby margins gives rise to a moat. Walk into a Padini or Brands Outlet store locally and see for yourself.

The Padini share might be cheap now due to DY and MOS, but I don't expect it to be going forward. They will just not be able to compete on a cost basis - Uniqlo and H&M a prime example. They are hanging on a thread via their shoes - Vincci and perhaps their cheaper office attire segment. Hence, drop in revenues and subsequently profits and share price might prove to be a negative going forward. I see no upside, only stagnant price in the mid/long term

That's how you calculate cashflow? Oh dear

Diam la lanciao

Look at lay hong. Short term traders faster dispose, don't drag price of the sector

Weaklings. Look at lay hong. All those weak holders faster dispose, don't drag price

Weaklings

So much discussion but do anyone of you know when do the Warrant C trade

Its now time to post a comparison of a 'Growth Investing' method (a basket of stocks that 'identify' as growth stock clearing certain ratios), vs Value/Dividend Investing methodology (like Magic Formula) and see which of the two performs better over a 5 year, 10 year, 15 year period etc

There will always be people who will doubt you. Especially the more right you are. Don't spend all that time answering the critics. Save your energy for something more useful. Time is of the essence

Come back and talk again in 5 years time old man, and we'll see

It amazes me how widespread the use of EBITDA has become. People try to dress up financial statements with it.

We won't buy into companies where someone's talking about EBITDA. If you look at all companies, and split them into companies that use EBITDA as a metric and those that don't, I suspect you'll find a lot more fraud in the former group. Look at companies like Wal-Mart, GE and Microsoft -- they'll never use EBITDA in their annual report.

People who use EBITDA are either trying to con you or they're conning themselves. Telecoms, for example, spend every dime that's coming in. Interest and taxes are real costs."

Source: Berkshire Hathaway Annual Meeting 2002 Tilson Notes

Time: 2002

He wants to unlock value in his shareholdings la, since macroview is that the world economy will be hit with a slump - China, then of course affecting the USA etc. When you're a large, major shareholder it is NOT EASY to unload shares - you can't do it during a panic because that will cause the share price to tank. So you do it slowly, even amidst a price surge/the share price will continue to go up. He will pare down holdings until at a stage he's comfortable at - its called asset management you dimwits

KISS - keep it simple stupid. All the adjustments will only tend to obscure and cloud the true figures. Just like food and the best produce - respect the produce and the natural flavours (or in this case, financial picture) emerges.

This new screeners - "Acquirer's Multiple" etc are just tinkering of the criteria's and algo's to get the best returns historically - for all you know you could come up with a screener that selects for loss making co's with large debts, and then backtest through 20 years, and find that the returns exceeds all the value investing screeners and think that its a viable strategy then find that it's caused by a paradigm shift ie the tech sector prior to the dotcom bubble etc

Mr KCChongnz, you could have been so much more. Yet you choose to stay at your level, instead of greatness. Television or radio, as well as a true audience for those who see value investing as the only method for equity investments. You could have contributed to the Malaysian investing community, and have your name mentioned in the same breath as Cold-Eye, TTB etc, perhaps even the start to a fund. Of course, for that to happen, requires a paradigm change, in thought process, in the way things are done, in one's business model. I am giving you this advice, for free, eventhough I would very much like to do it myself. The difference? I do not have the following and I am not here to reinvent the wheel. Don't limit yourself to small-time subscribers. Be better than the Gap.

Hope sounds defeatist

Mr Kcchongnz, thanks for the analysis, however with all due respect your sharing should move on from merely sharing DCF, DDM, ROIC theory to actual stocks in Bursa that have good cash flows, substantial margin of safety etc - a shortlist so to speak, and then move to do a crowd-sourced analysis - I'm sure there will be willing participants in this endeavour. Where you will have active critiques and debates on the financial statements, assumptions made etc

Take it to the next level.

That is where you will be a true champion of the people, Malaysia's very own Value Investing guru.

A better comparison would be to value the property segment of Scientex on a standalone basis vis a vis the other small/mid-cap developers