Posted by paperplane2016 > 2016-06-23 07:06 | Report Abuse

Another rubbish. Waste time no value

Posted by paperplane2016 > 2016-06-23 07:06 | Report Abuse

Clinton??? Yeah, have sex with ladies around....

Posted by paperplane2016 > 2016-06-23 07:08 | Report Abuse

The economy bubble started his time

Posted by soros228 > 2016-06-23 07:14 | Report Abuse

Very well written. Any others potential futures earning counters apart from Airasia?

Posted by Hiu Chee Keong > 2016-06-23 07:55 | Report Abuse

Everyone has their own method, whether which one is better...that's arguable. If the future is easy to predict, then everyone will be as rich as bill gate already.

Posted by kk123 > 2016-06-23 08:11 | Report Abuse

Its garbage.
Icon shld instead write about how wonderful is his concorp...

Posted by Ooi Teik Bee > 2016-06-23 08:18 | Report Abuse

It is the future earning drives up the stock price. It is the future growth on EPS, but not the past earning. The past earning is to determine how good is the management. A good management always able to deliver the good result.
Thank you.

Posted by Mohamad Jeffrey Ismail > 2016-06-23 09:00 | Report Abuse

During AA share price plunged reaching RM0.80, no one brave enough to say about those future earnings... it just when the share rise above RM2 people keep talk about future earning.. Earning drive speculators while value drives those investors. Thank you.

Posted by michaelwong > 2016-06-23 09:07 | Report Abuse

Stock picks accuracy with broad based analysis and tracking , I still preferred Icon8888 .
Good writes up . .......shared more stocks tips . Thnks !

Posted by calvintaneng > 2016-06-23 09:21 | Report Abuse

Whoa!

Calvin now a Titan?

Never thought of that when I joined i3 Forum on September 2013

Yes, Calvin is here to learn from everybody.

I think Icon8888 made a sweeping statement with WRONG ASSUMPTION Lor!!

Icon says,

"Calvin's style of investment is the exact opposite of what I describe in this article. He invests based on NTA. He does not believe in earnings."

Calvin replies:

"Calvin invests based on NTA" IS TRUE!

"He does not believe in earnings" THIS STATEMENT IS FALSE! THAT'S A LIE FROM ICON

Why?

If Fact If All Fair Minded HONEST FORUMERS WILL LOOK CAREFULLY CALVIN'S OVER 11,000 POSTS You Will Notice That Calvin

Is 70% ON NTA

AND 30% ON GROWTH!!

PLUS CALVIN ALSO ADVOCATE BUYING THEMATIC PLAY STOCKS

For NTA Calvin Called For A Buy on Pm Corp at 15 cts. Pm Corn NTA was 50 cts & NET CASH was 18 Cents. That was a Chun Chun Call on September 20th 2013

Later Calvin Called for a Strong Buy On Furniture Export Stocks Due to Ringgit Crash

Buy Pohuat at Rm1.25 (Power Huat Up Rm3.80 & Split) Up 200%

Same for Super Enterprize

Calvin called for a buy because plastic will benefit from CHEAPER OIL!! So Growth of Profit accelerate mah! Super up 200%

Then with falling revenue Govt Implemented GST So Calvin called for a Buy on MyEg (MyEg has no Nta. You See!) My EMAS GOLD up 100%

So next time check carefully.

Seeking popularity is one thing. Conning is another.

Hope all can SEE and differentiate

Have a nice day

Regards

Calvin

Posted by Jonathan Keung > 2016-06-23 09:29 | Report Abuse

nothing is cast in stone. we need to adapt, adopt and change with this fast pace scenario. in the past , warren Buffee style of buy and hold strategy might work for Buffee but not necesarry for you and me. Unless your investing horizon strech more than 10 years. Theme play, future earnings, value rich or turn around stories each one has their own strenghts

Posted by General8118 > 2016-06-23 09:39 | Report Abuse

Good read. Stay humble. Be sifu above sifu.

Posted by Icon8888 > 2016-06-23 09:46 | Report Abuse

grievances noted

i have amended accordingly

===========
calvintaneng
Icon says,

"Calvin's style of investment is the exact opposite of what I describe in this article. He invests based on NTA. He does not believe in earnings."

Calvin replies:

"Calvin invests based on NTA" IS TRUE!

"He does not believe in earnings" THIS STATEMENT IS FALSE! THAT'S A LIE FROM ICON

Posted by goreng_goreng > 2016-06-23 10:08 | Report Abuse

totally rubbish, no tell what stock good to buy now ah??? what to sell??? write long2 but no tips given at all?????? hahaha just kidding, really like read this one.

Posted by probability > 2016-06-23 10:42 | Report Abuse

I think we cannot deny that for a stock to move up from current price…its ‘solely depended’ on its Earnings growth (1) excluding market sentiment and macro stuffs.

However, there is a huge difference buying a company with similar prospect but different MOS. On those without MOS (2)…one has tremendous damage potential if things did not turn out as expected.

KC’s strategy is exactly based on that…he has this dando principle…if head win if tail you don’t lose much strategy. He buys a company with sufficient MOS and does not rely on ‘speculative data’ (3) on future earnings prediction and instead has ‘quantitative way of assessing its future potential based on its Historical financial statement’ (4). This is solely for those who wants to avoid cracking too much head predicting future earnings….if they are as good as Icon they can do it of course.

KC = considers (2) and (4) to value a stock….but do not be like Stockman who only considers (3) without a clue on (2) & (4)

Icon = (4) & (3)…and covers (2) via using low P/E criteria which is a crude method of valuation but has the simplicity to attract investors…

Of course combining KC’s method i.e using (2) & (4) together with E-arnings visibility i.e same as (3) which will be growing will be the best……but that is not promoted by KC’s teachings…..he did not need to actually…cause any student who would understand the equation – DDM model would obviously know its intrinsic value calculation is all about Future Cash Flows…..nothing but Future.

He was just telling how to have a higher accuracy on predicting the Future….and do not forget about what the company ‘already have’ of the Future expectations you striving for . i.e the cash pile and business quality.

Posted by probability > 2016-06-23 10:45 | Report Abuse

KC...sorry I main sibuk as a way of learning..he he...the above are just my interpretations....may be wrong.

Posted by Ricky Yeo > 2016-06-23 10:58 | Report Abuse

It is a bit hard to believe that many still believe it is future earnings that drive share price. That is only half the story but plenty is willing to take it as the truth.

That's a bit like saying 'hey i ran for 5 hours yesterday at the park' but I leave out the most important part - How many km did I run.

It is the ROIC that determine the share price silly.

Posted by probability > 2016-06-23 11:03 | Report Abuse

Ricky....again the historical data - that how many Km you had run (similar to historical ROIC) has no relevance other than to 'indicate' how much potential you have to similarly perform in the future.

That's why the past has impact on the price....but purely as a predicting tool of the future - nothing more.

Posted by Up_down > 2016-06-23 11:03 | Report Abuse

Don't ignore the risks even though a company has a very solid expansion plan or new factory. It may take few years for the new plant reach break-even. Wellcal is a good example.

Posted by newbie92 > 2016-06-23 11:03 | Report Abuse

Icon8888 sifu, may i know how you derive TP if we focus on future earning? Thanks.

Posted by Icon8888 > 2016-06-23 11:09 | Report Abuse

I believe stocks trading at below 8 times prospective PER are good buy

Posted by yktay1 > 2016-06-23 11:24 | Report Abuse

Why not explain your call on Comcorp instead?

Posted by Ricky Yeo > 2016-06-23 11:30 | Report Abuse

You are right, it is past. Isn't the whole ball game of investing about predicting? You need the past in order to improve your accuracy of the future right? How well I run in the past of course doesn't determine how well I run in the future but it is a starting point nonetheless. If I tell you im gonna start floating tomorrow, be careful, thats a wonderful growth story.

Looking at the past is not about extrapolating past figures into future, it is about understand the 'WHY', the WHY of all the value drivers, namely the main one is ROIC. And value investing as a whole is never about avoid predicting the future, but rather be conservative about it, have a margin of safety knowing human made errors in judgement. And again, if investing is not forecasting, what is it then?

I have no idea who get all this crap of looking at the past because you want to extrapolate the future. By the way thats what ppl does when they apply PER to the most recent EPS, so called people trying to predict future earning and despise ppl trying to look into the past.

Looking at the past is about asking more question and finding what make things as it is, it isnt about accepting everything you see. It is about studying why the company can achieve such a profit, and reverse engineering to ROIC, margin, revenue growth and looking at the industry forces from supplies, substitute products, buyers forces, rivalry within the industry. Looking at the past is about triangulate the analysis of your past and your estimation of the future so you dont get yourself over your head and have an ounce of skepticism, which is rather lacking in this forum.

Posted by Ricky Kiat > 2016-06-23 11:31 | Report Abuse

hand up & leg up agree. thanks sifu icon8888.

Posted by Icon8888 > 2016-06-23 11:38 | Report Abuse

I don't have any problem with my Comcorp call. I called buy at 45 sen on 18 December 2015 and informed everybody that I sold at 83 sen on 25 March 2016. What is the problem ?

http://klse.i3investor.com/blogs/icon8888/88366.jsp
http://klse.i3investor.com/blogs/icon8888/93754.jsp

if you are caught by the recent pump and dump, are you stupid or am I stupid ?

yktay1 Why not explain your call on Comcorp instead?
23/06/2016 11:24

Posted by connie > 2016-06-23 11:43 | Report Abuse

morning icon .. woah FA is very difficult to learn !! all the terms are very intimidating :( and i notice all the FA experts write very good english :)

Posted by Icon8888 > 2016-06-23 11:45 | Report Abuse

connie your England much much better than me lah...

Posted by connie > 2016-06-23 11:51 | Report Abuse

no icon .. look at probability .. jonathan .. ricky yeo .. kcchongnz .. icon8888 of course .. and many more :) this is one glaring diff between FA and TA folks !! the latter will say 'buy lah on breakout .. all time high already mah .. got volume some more' :):) LOL

Posted by probability > 2016-06-23 11:52 | Report Abuse

nothing can be more intimidating than an overly beautiful connie...having so many guy friends..:(

Posted by connie > 2016-06-23 11:58 | Report Abuse

hahaha probability .. overly beautiful connie is excessively intrigued by the male species and hence many guy friends :) especially the brainy ones ...

Posted by Icon8888 > 2016-06-23 12:04 | Report Abuse

I advocate looking at both the past and the future

Both are important

------
Ricky Yeo You are right, it is past. Isn't the whole ball game of investing about predicting? You need the past in order to improve your accuracy of the future right? How well I run in the past of course doesn't determine how well I run in the future but it is a starting point nonetheless. If I tell you im gonna start floating tomorrow, be careful, thats a wonderful growth story.

Looking at the past is not about extrapolating past figures into future, it is about understand the 'WHY', the WHY of all the value drivers, namely the main one is ROIC. And value investing as a whole is never about avoid predicting the future, but rather be conservative about it, have a margin of safety knowing human made errors in judgement. And again, if investing is not forecasting, what is it then?

I have no idea who get all this crap of looking at the past because you want to extrapolate the future. By the way thats what ppl does when they apply PER to the most recent EPS, so called people trying to predict future earning and despise ppl trying to look into the past.

Looking at the past is about asking more question and finding what make things as it is, it isnt about accepting everything you see. It is about studying why the company can achieve such a profit, and reverse engineering to ROIC, margin, revenue growth and looking at the industry forces from supplies, substitute products, buyers forces, rivalry within the industry. Looking at the past is about triangulate the analysis of your past and your estimation of the future so you dont get yourself over your head and have an ounce of skepticism, which is rather lacking in this forum.
23/06/2016 11:30

Posted by BumbleBee > 2016-06-23 12:05 | Report Abuse

KISS is the best LOL

Posted by tftey > 2016-06-23 12:13 | Report Abuse

Fully agreed. In summary, Future earning is the main driver and past history provided clues and confirmation.

Posted by NOBY > 2016-06-23 12:39 | Report Abuse

You are right that earnings matter. Actually most net nets that eventually go up in price due to some catalyst such as they manage to record some improvement in their earnings or maybe declaration of special dividend or privatization. However, the difference vs chasing growth stocks is that you buy them during the most pessimistic time when they are the cheapest and sell them once people get excited about them again.

There are many successful net net investors around. You can check out this blog on some examples on what to look out for when investing in net nets.

https://www.netnethunter.com/net-net-blog/

Posted by buddyinvest > 2016-06-23 12:44 | Report Abuse

Great works Icon8888!

Posted by buddyinvest > 2016-06-23 12:46 | Report Abuse

Calvin has been made a Titan because he predicted that the palm oil can hit RM6k/tonne.

Posted by Icon8888 > 2016-06-23 13:29 | Report Abuse

thank you Noby

Posted by Tom > 2016-06-23 13:38 | Report Abuse

totally rubbish, no tell what stock good to buy now ah??? what to sell??? why write long2?????? hahaha just kidding

ps: i learned it from goreng_goreng, thank you

Posted by JN88 > 2016-06-23 13:42 | Report Abuse

Icon bro you say future earning later people say you are same to bomoh.

When I doing nasi lemak business, I'm also speculating, calculating the expected customers that may be coming to my gerai gerai.

Hence, the best way investing in stock is future earning for me.

Nasi lemak selling = stock investment .

Posted by Ezra_Investor > 2016-06-23 14:03 | Report Abuse

Icon, If you haven't read "The intelligent Investor", I recommend this book to you. Understand 1 thing.

1. Graham's method of investing focuses on cigar buff investing & net net investing. Both of them are a double edge sword, as while companies may be selling cheap, they are not necessary a good investment. The quality factor is not the concern there. This is what is happening to Calvin's method of investing. It is not totally wrong, but very risky. That's why I don't discount his method of investing, but not a fan of it.

Buffett used to have this method of investing until his investment firm grew to a sizable size, but this causes him to start losing money later. Later, his partner and lifelong friend Charlie Munger, advises him to shift his method from "Buying companies selling at a cheap price" to "Buying good quality companies at a fair price". Hence Buffett come to where we know he is today.

This is also how he come to say he is "85% Fisher, 15% Graham" today, instead of 100% Graham.

Another person who does this is Fong Silling. He always advises people to own high quality companies. Does this help clarify anything?

Posted by Icon8888 > 2016-06-23 14:13 | Report Abuse

thank you for your input

Posted by soojinhou > 2016-06-23 14:20 | Report Abuse

I must say I am thoroughly entertained by your piece. I agree that no one should blame KYY for their own investment decisions. If you want to win in this game, you work hard and research hard before KYY buys. If you are merely a follower than you only have yourself to blame. If you want to win, you have to be ahead of KYY, not follow him.

Posted by Ezra_Investor > 2016-06-23 14:21 | Report Abuse

You're welcome, my friend. No need to be so formal with me since we're friends right? And oh, one more thing. The tagline "It Is The Future Earning That Matters, Stupid" is not entirely true.
I don't always agree with Ricky Yeo's statement, but what he says is correct this time. Lemme explain why.

Warren Buffett’s investing principles focus on return of equity, ROE. This is his thought.

“Customarily, most investors measure annual company performance by looking at earnings per share (EPS). Did they increase over last year? Are they high enough to brag about? For his part, Buffett considers EPS a smokescreen. Most companies retain a portion of their previous year's earnings as a way of increasing their equity base, so he sees no reason to get excited about record EPS. There is nothing spectacular about a company that increases EPS by 10%, if at the same time, it is growing its equity base by 10%. That's no different, he explains, from putting money in a savings account and letting the interest accumulate and compound. Worse still, there are many companies borrow huge amount of money to improve EPS, but the marginal return is way below its borrowing costs".

While I read this from other investing blogs, KC has wrote about this before.
http://klse.i3investor.com/blogs/kcchongnz/88007.jsp

Posted by YiStock > 2016-06-23 14:52 | Report Abuse

It is the many many parts to put together to have a giant elephant. When one touch on one part of them, please continue to explore other parts too . A missed of any part will not make the elephant a complete and powerful one.

Posted by Buns > 2016-06-23 14:58 | Report Abuse

Amazing. One of the best pieces of writing I have ever come across. Better than WSJ, fund house reports, investor books. You really have a gift.

Posted by stockraider > 2016-06-23 15:06 | Report Abuse

Posted by Ooi Teik Bee > Jun 23, 2016 08:18 AM | Report Abuse

It is the future earning drives up the stock price. It is the future growth on EPS, but not the past earning. The past earning is to determine how good is the management. A good management always able to deliver the good result.
Thank you.

RAIDER COMMENT;
OF COURSE, IT IS THE FUTURE EARNINGS LOH...!!
BUT THEN WHY LOOK INTO PAST EARNINGS ?
U LOOK INTO PAST EARNINGS TO DETERMINE THE QUALITY OF EARNINGS AND ITS STABILITY AND SUSTAINABILITY LOH....!!

IF U TALK TO SOME TEACHERS....THEY WILL TELL U THAT THE TOP 10 STUDENTS USUALLY PROGRESS WELL AND SCORE WELL IF THEY PROGRESS TO THE NEXT STAGE OF ITS FORM.

THE SAME APPLY TO STOCK MAH....!!

Posted by probability > 2016-06-23 15:08 | Report Abuse

aiyo...touching parts and exploring....hmm stocks are as tricky as women... if only the objectives are as straight forward as it is for men...he he...

Objective: Find a stock which has the potential to give you 'future value of cash pile' (a) as much as possible compared to the 'cash you have taken out to buy the stakes' (b) within a time frame years of your concern (t) - that's all. i.e the CAGR = (a/b) ^ - 1/t

all discounting using cost of capital are just a comparison of the average return you can make from the market at large...and all variables you use...name it what ever you want...has only that one objective of predicting the future cash pile with the time frame you are concerned.

variables:
- management
- roic
- salesman competence
- USD exchange rate..
- dividend payout..
- cash pile
- debt risk
- cash conversion cycle..
- whatever you want..

Posted by YiStock > 2016-06-23 15:13 | Report Abuse

Probability, women are more complicated :-)

Posted by probability > 2016-06-23 15:16 | Report Abuse

YiStock...totally agreed.

Posted by ckkhen > 2016-06-23 15:17 | Report Abuse

A very provocative article that invites much intelligent discussion. We can learn much from it. Thanks, Icon8888.