Posted by qqq3 > 2019-01-02 13:05 | Report Abuse

Flintstones > Jan 2, 2019 11:35 AM | Report Abuse

Long numbers guy approach is pure business sense phil fisher style.
==========

phil must be a smart guy.

Posted by rajachulan > 2019-01-02 13:21 | Report Abuse

true qqq3....

i just want to say one more thing...
in this world....there is only...

one buffet...
one cold eye...

only thing i pay attention on the FR is the prospect section... to see how truthful the company is about their future...and it is the most hardest part to understand...but always remember the key words

satisfactory meanse okay
challenging means shit
expect means pretty confirmed
believe means 50/50

enjoy reading the FR!

Posted by teareader818 > 2019-01-02 15:49 | Report Abuse

rajachulan, you may miss out a good thing as there are still honest men around who say what they mean and mean what they say.

Posted by Icon8888 > 2019-01-02 15:50 | Report Abuse

Is Family Mart owned by QL ？

I bought breakfast there everyday. Sandwich and sushi

My Friend told me it is a Japanese brand. He frequented their shops in japan everyday when he was a student 20 plus years ago

Posted by qqq3 > 2019-01-02 16:01 | Report Abuse

QL is franchisee lah....been around some time already u know? very popular with students and young ones.....

Posted by qqq3 > 2019-01-02 16:15 | Report Abuse

Family Mart got unique selling proposition...u also like their sandwiches and sushi...and don't forget their ice creams that pull in the crowd......One day this thing will be listed....

Posted by qqq3 > 2019-01-02 16:20 | Report Abuse

rajachulan > Jan 2, 2019 01:21 PM | Report Abuse

true qqq3....
==========

really strong brands and companies not many....u will not know unless they are big enough, long enough to be noticed ...and expensive enough to discourage u to buy......lucky are those who know the owners early enough....understand the owners, understand the company....not many such companies that have staying power and growth...

so , mostly, people just buy average companies and hope for the best....and gets disappointed if they keep long enough.......really great businesses are one in a hundred......

Posted by qqq3 > 2019-01-02 16:32 | Report Abuse

icon

analysts are excited by serba, checks the right boxes.....maybe one day joins the elites list.....

Posted by Icon8888 > 2019-01-02 16:55 | Report Abuse

Can or not ? I scare companies that venture overseas and secure contracts here and there woh

Posted by Flintstones > 2019-01-02 17:01 | Report Abuse

Business sense investing is a very powerful concept. When Masayoshi Son invested i Alibaba, do you think he looks at the value investing yardsticks like ROIC, ROC or FCF? All he had was a business sense. The ability to discover and identify a great business with great moat that has a long run way. In Malaysia, most fund managers invest like Masayoshi Son too. Our institutional funds like EPF, PNB, Khazanah and many more mutual funds have too much money to invest. What is the safest choice of investment for them? It has to be the great companies in Malaysia that is able to give sigle digit returns that beats inflation. That is why despite Hartalega at 46x PE, fund managers continue to buy. These ivy league, MBA or CFA fund managers arent stupid. They are investing like warren buffett. You think they do not know Insas is undervalued? EPF could acquire the whole company tomorrow morning and realize the arbitrage value. But no, they invest in great businesses

Posted by Flintstones > 2019-01-02 17:03 | Report Abuse

The key here is be like long numbers guy. Discover great businesses with moat before the fund managers do. Institution funds do not practise a value investing strategy. They do growth investing. Of course, it is best to have value and growth which is hard to come by. The examples are aplenty, GDEX, REVENUE, DLADY, F&N etc

Posted by qqq3 > 2019-01-02 17:21 | Report Abuse

ed by Icon8888 > Jan 2, 2019 04:55 PM | Report Abuse

Can or not ? I scare companies that venture overseas and secure contracts here and there woh
======

malaysia is so small.....how to be elites if don't go overseas? jagoh kampong got la......

Posted by qqq3 > 2019-01-02 17:44 | Report Abuse

Flintstones > Jan 2, 2019 05:01 PM | Report Abuse
But no, they invest in great businesses
=======

great stuffs....its psychological also....fund managers can buy Harta at 46 PE because their competitors are doing it....

scared scared can only buy Insas lo.....years later...Insas still same price,...Harta next level already......lol....

Posted by Flintstones > 2019-01-02 18:57 | Report Abuse

Lets not talk about other counters here. We need long number guy insights on QL

Posted by qqq3 > 2019-01-02 18:59 | Report Abuse

Flintstones > Jan 2, 2019 06:53 PM | Report Abuse

Who will buy Insas? The numerous gullible i3 members will. Insas is the most analyzed stock on i3 where every month sure got newbie come share!
==========


lol

Posted by Shinnzaii > 2019-01-02 19:01 | Report Abuse

LOL talk about insas later I3 member with eagle icon come here comment...hehehe

Posted by Sslee > 2019-01-02 19:59 | Report Abuse

Dear all,
If you feel that a PE of 50+ and dividend yield of below 1% growth stock is your cup of tea, no one going to stop you from buying more.
As other people may think he has a better choice and success on those beaten down value stocks now. To each his own.

Thank you

Posted by lizi > 2019-01-02 20:12 | Report Abuse

got growth who look at PE? wait until growth deteriorate first then only talk PE. this is how market works.

Posted by jellyfish > 2019-01-02 20:16 | Report Abuse

if you want to buy QL , go ahead , nobody is stopping u , just dont talk bad on value play stocks..

Posted by R Saleh > 2019-01-02 20:24 | Report Abuse

oHOOOO...save money, sell all QL as they suggest me www.moneyliferesearch.com waiting for movement.

Posted by 10154899906070843 > 2019-01-02 23:09 | Report Abuse

Hi Mr Lee soon sheng, I believe there is nothing wrong with buying beaten down value stocks. Every stock, whether growth or undervalue or dividend or defensive is a value stock. Would anyone not buy a stock because of its future value? But looking at stocks you have to see the long game.

And to see the long game you need to understand the story of the business. I have spoken alot on ql and it is easy for me to repeat and sound like the old man I am. However, I prefer to work with things that I also read and know well, so maybe we can talk about the long game of insas, your biggest holding and favorite stock.

What do I see when I look at the company? It is a company that has one lucky break in inari, but is then trying out everything and anything to catch the next lucky break. It does dome cafe ( which is not being managed as well as Starbucks or old town or even Papa rich), it does fashion retail, it does car rental, and of course it also does semicon.

However the feeling I have is that the company is just a company that does m&a, a stockbroking type company, and I think the market knows this and treats it as such. The teams there are just not good at growing their non inari business, and I don't things will change in the future.

You are neither wrong not right because people say it you believe you are. You are wrong or right because the facts say you are.
And the facts are this: INSAS is a one trick pony that got lucky with inari, and it struggles with growing everything else. It's management is not specialists in their business fields, and their only long game relies on finding wonderful jewel businesses at a young age.
If you buy a share in INSAS, you are basically just betting on the long term survivability of inari. But as inari is a listed company and not private, each time INSAS sells inari shares to pay for their m&a items, the share price drop will be more excited, turning INSAS into a huge value trap, it looks nice and valuable with good pe on the outside, but once you dig into the figures of what happens with management and assets, you realize you are on shaky ground.

You say the value of INSAS is rm4. But the business of INSAS is worth nothing if the value is not unlocked. The only guaranteed play INSAS has is to sell it's inari shares for dividends to give to shareholders, because it has no clear way of growing it's business. It doesn't have a moat with a manager like Warren Buffett, who can pick up excellent businesses every year. Inari itself is a wonderful business, but you are buying INSAS instead, why? For the perceived value of inari if INSAS sells all it's stock holdings and dividend rewards it's shareholders. Which it will never do. Because their management would not be able to find another inari. But you do realize, inari shareholders are the last to get paid if a company goes bust. INSAS will probably never sell inari, not have the skills to run the ship properly if Mr Ho and Mr Mai were not around to help fight for projects and technical skills.

When a stock is beaten down, it usually is for a reason. And the equation you need to ask yourself is this. What is the real value of INSAS if you take out the share holdings in inari. What are the business prospects can you look forward to in their growth 10 years from now without inari. Will they be able to find another inari to invest in?

With their current record, I highly doubt it. Same thing, would you invest in a value company with pe5, but where you cannot look at the growth prospects in the long term, the quality of management, the success of their business units? Or invest in a company with pe 50 with a huge defensive moat, consistent growth every year, and successful growth and execution of its new business units.

To be honest, comparing the competitive moat between a semicon factory without it's own foundry and r&d budget to compete with Intel, qualcomm who will compete with you if times are bad, and a surumi business which is asean market leader and growing it's clear which will be safer in the future investment. Then you add business execution of family Mart and dome coffee, and you can immediately see the synergy and quality of management in spending your investments wisely and growing earnings properly.

There is a thing to be said about paying fair prices for great companies.

And being stuck in value traps which lure you in with 2 cents dividends and proceed to eat up your capital.

Sometimes the market does know something you don't.

If you paid fair (or slightly overvalued) prices for excellent stocks, you wouldn't lose a night's sleep.

I bought QL 9 years ago - happy until today
I bought public bank 9 years ago - didn't buy ambank not RCECAP. Didn't lose sleep. Still great profit until today.
I bought TOPGLOV 9 years ago - quality of management never made me worried.
I bought YINSON 7 years - best in class.

Posted by lizi > 2019-01-02 23:36 | Report Abuse

wow......long number guy wrote out what i have always thought about insas too......i ask the key question before and finally someone wrote it out nicely...

Posted by lizi > Jul 28, 2018 10:37 AM | Report Abuse X

all repeat about the numbers, but do u really like what insas is doing? its business?

Posted by qqq3 > 2019-01-02 23:53 | Report Abuse

this long number guy really no joke la.....as they say, best in its class......

Posted by qqq3 > 2019-01-02 23:54 | Report Abuse

long number guy....a class act....

Posted by stockmanmy > 2019-01-03 00:02 | Report Abuse

Insas is controlled by a stock broking family people don't trust....for the reasons stated above.....


a goreng stock guy who got one lucky break in Inari.....so?

if like inari so much , go buy Inari la....always remember, if u like the girl, marry the daughter....don't marry the mother just to fuck the daughter......


analysts calls it the holding company discount......

Posted by 10154899906070843 > 2019-01-03 07:08 | Report Abuse

I've been around long enough in the market to know how easy it is in the local bursa market to know how syndicates can build their own value trap companies. Especially if you can't short shares and can only buy them.

People seem to think that investing in bursa stocks is the same as investing in NYSE or NASDAQ.

It's not.

It's a lot harder ( and simpler sometimes) to invest in bursa stocks because the market is smaller, the clear investing choices less, the monopolies more moaty.

The best in class stocks in bursa always seem to have a pe between 24-50. I don't know why it's that high, but when everyone is super defensive, that's the way to go.

I started my current method of investment I've lost multiple fortunes investing other methods in the stock market.

Posted by qqq3 > 2019-01-03 10:05 | Report Abuse

osted by 10154899906070843 > Jan 3, 2019 07:08 AM | Report Abuse

People seem to think that investing in bursa stocks is the same as investing in NYSE or NASDAQ.

It's not.
===========


another gem

Posted by Flintstones > 2019-01-03 11:25 | Report Abuse

Holy shit. Learnt so much wisdom reading long numbers guy posts.

Here is a question for you:

What are your views about small/mid cap stocks besides them being heavily manipulated?

We all know there are good gems in the small/mid cap market. Hartalega started out as a small cap stock. Back in 2009, I remember buying Harta at 10x P/E and watching it double in a short space of time.

Assuming we know a business that has a huge competitive advantage, what criteria do you look at and say this small/mid cap company might be worth investing in the long run?

Posted by lizi > 2019-01-03 11:30 | Report Abuse

huge competitive advantage is already very strong point...then look at potential of sustainable growth, how big is the market can be, local or can expand to the world?

Posted by lizi > 2019-01-03 11:34 | Report Abuse

in bursa, small/mid cap also got growth, but most of them is cyclical growth and not long term sustainable growth......u must differentiate between the two....

Posted by Flintstones > 2019-01-03 11:37 | Report Abuse

And another question is regarding AirAsia:

This is a counter which you picked under i3 stock pick contest.

Airasia undoubtedly has moat. It is one of the lowest cost airline in the world by various airline yardsticks. eg. Cost per ASK. Over the last 20 years, Airasia continue to gain market share from its competitors. It completely dominated the Malaysian domestic route market and looks to repeat the same feat in other ASEAN countries.

Historically, Airasia traded at 1.9x book value at its peak valuation. Now, it is 1.15x book value. With the ongoing asset light strategy, it seems Tony Fernandes is doing everything to prop up Airasia value recognition.

In your opinion, why does Airasia not being given a higher valuation like QL? I noticed that you mentioned cyclical stocks are typically given low valuation because investors can choose not to buy.

Does the same theory apply to Airasia? Or there are other reasons behind the low valuation?

Posted by Icon8888 > 2019-01-03 11:39 | Report Abuse

Flinstones did you participate in stock picks ?

Posted by 10154899906070843 > 2019-01-03 12:04 | Report Abuse

for air asia, the way i think of it is like this.
The indonesia and phillipines is losing money yes, but they are cornering and killing the other lcc's with prices. When we do price comparison of tickets, it is always in comparison to Air Asia, so it becomes the benchmark. the long game for AA is in 10 years, it will continue to gain market share and can afford to kill off the smaller competitors ( like that langkawi fellow), malindo, cebu pacific etc etc with lower margins and more carrying seats. It already has one of the highest loading factors in the industry. So definitely growth is there, but how we look at AA vertical integration is the key thing to increase profit and long term business growth.

In terms of quality of management,
which other airline actively pushes duty free goods and catalogue purchases (even online web buys) to the passengers who have to sit for hours with nothing to do? I know my wife keeps buying impulse buys on almost every long haul trip.

which other LCC sells prebooked meals (which are actually pretty good), rokki plane internet connectivity, special premium seats, and free money from build your own insurance and service charges? in fact, as far as I can remember, AA was pretty much the first airline that sold food on a plane in Malaysia for me. That was when I knew it can survive and prosper.

when you watch a movie in the cinema, the big earnings are usually from the popcorn and drinks and etc you buy when you watch the movie. the tickets they dont earn that much because the movie companies earn the big bucks from there.

AA is even smart enough to get group discounts and special prices to buy bulk planes, which they sell parts off at profit to other carriers, and gives it out as dividends to shareholders.

In terms of carriers and the performance in getting the most bang for buck with its passengers, its pretty much best in class.

However....

Posted by 10154899906070843 > 2019-01-03 12:24 | Report Abuse

Now here is why AA is not in my list of stocks that I buy for myself (its only included in the stock pick list because we need to choose 5)

There is not much differentiation between carriers other than how low you are willing to go. Everyone pays the same price for fuel, everyone buys the same planes from the boeing or airbus. Everyone has to get maintenance and parts from them.

Meaning in the long run, everyone will start to compete in the same way, so the profit margins will basically be the same for everyone.

Air asia has NO MOAT. Its prices are basically controlled by the prices of jet fuel (50% of operating costs), it doesnt have its own homebuilt planes, it doesnt have a unique business model. If it had a moat, it wouldnt be selling off its planes and would probably be getting more and expanding into more countries.

Its just the best at what managing what it can manage. Which is immediately cutting off bad fly routes, focusing on revenue earning flights, and selling off what is unneeded, maximizing impulse buys. Its a midterm gain, nothing special in the long run.

For me, if a carrier decides to become like netjets business model(with fractional cost, pay first enjoy later) and becomes the first to market then it has a moat. If it becomes like uber with market changing system, then it has a moat.

For me, AA and inari is quite similar, after years of suffering and other plane stocks died horrible death (or in inari case 2005 when all the semicon companies left penang crashing and burning), the survival of the most adaptable had a big lead and kept running with it. its just like the dot.com crash, the ones who survive are by definition the most efficient.

In summary, the low valuation comes from the unknown costs that are uncontrollable (like fuel prices, plane maintenance costs and costs which you just do not have a way to solve). Its also a business where anyone with enough money can get into, which brings down long term profit margins.

It is much easier to sell high price and discount down, then to sell low price and bring it up.

Posted by Icon8888 > 2019-01-03 12:27 | Report Abuse

Need to hang around here more

A lot of very interesting discussions recently

Led by Mr Long

Posted by Flintstones > 2019-01-03 12:33 | Report Abuse

Jesus. Thank you long numbers guy. This is a different insight that we always read in the mainstream analyst reports. That explains why Airasia is accorded subpar valuation despite its track record. What you said is true. Many small airlines have caught up with Airasia business model. Buying planes in bulk, being lean and focus on the higher margin ancilliary income business.

Back to the small/mid cap question in my post earlier, what are your thoughts?

Posted by qqq3 > 2019-01-03 12:41 | Report Abuse

not to worry...a great businessman will continue to do great stuffs.......Tony says , one day his non airlines business will be bigger than his airlines business......

Posted by qqq3 > 2019-01-03 12:43 | Report Abuse

technology enabled businesses.....Tony will be there.....

Posted by 10154899906070843 > 2019-01-03 13:53 | Report Abuse

Hi flintstones, personally i dont think all the small/midcap businesses are all manipulated, its just that the market is so small that investors with margin financing and a quick feet can float or sink a company very easily causing distress, I mean the standard smallcap company is 100-200 million market cap. The standard midcap company is 500-800 million market cap.

For me I dont really look at the company whether smallcap, midcap or largecap. In fact, when I first started buying QL, it did drop below 200M USD valuation (penny stock range).

My investing principles that worked was simply buying into stuff that I know and am familiar with, things that I can see.

I bought QL because at that time I was heavily involved with engineering with boilermech. They were a fantastic paymaster and was a very well run company always finishing biomass projects under budget and on time, and from there I started to look at QL. When I did, I realized that it was running its businesses far far better than all the other poultry/seafood farms, plantations, feed mills around Sabah area.

That was when I knew I had to look at QL deeper. Reading into the financial reports, it was very high pe (around 29 if i remember correctly), but the free cash flow, the growth in revenue, and the speed of implementation. I attended AGM. read into the competitors.

I remember shaking mr chia song kun hand and actually having a talk with him regarding his policies and strategies. Very humble and hands on man who wakes up at 5 and goes to site directly early morning. If I could have him working for me I thought, I'd never lose a nights sleep.

In a weird and funny way, he is working for me! In fact, the reason I could send my daughter to USA for further studies is because of him.

Never underestimate quality of management!

In summary, basically what I am trying to say is there are thousands of stocks in bursa. Some smallcap, some bigcap. There is no way for you to understand deeply all of them or for you to visit all of them. So why try? Stick to what you know, know deeper in companies that you know are very efficient and doing well and keep doing that.

Why feel angry or upset when people like choivo make millions of dollars in their investments? They made it so just be happy for them, as long as you make money on yours as well.

Just dont trust those who buy shares and stocks in 10-20 different industries and recommends to you to buy into rcecap, insas, layhong,development companies, hengyuan, petronas, elsoft, jaks, sendai whatever all in one portfolio (somehow I dont think choivo is doing too well). There is absolutely no way they can have a deep opinion about all those companies just by reading financial report only.

Thats insane.

Even the best investor of all time, Warren buffet doesn't do that. I know for a fact that Warren attends AGMS, talks to tedd and todd every other day to bounce ideas, reads trade journals, reads newspapers, reads financial reports, reads market reports, reads sales and revenue analysis, reads moodys manuals back and front, receives business proposals every day. He basically reads 12 hours a day, and even with that he makes mistakes all the time.

Me? I read a lot, but I stick to the stocks I know. I wish I knew a easier way to make money investing, but to be honest?

Its a lot of long hard work. There is NO easy way.

Stick to what you know (just no confirmation bias, and be brutally honest).

Posted by godhand > 2019-01-03 15:21 | Report Abuse

Looking at your comment you are looking at surface only. U only know skin. U don’t even know what tony visions are. Budget Passenger carrier service is only to absorb market participation very much like grab or do U think it’s the only source of income? I notice u somehow trying to compared it to ql. I can tell u airasia is in another tier.

Posted by qqq3 > 2019-01-03 15:25 | Report Abuse

god , dont want to buy air asia...dont buy la......no big deal.

Posted by Flintstones > 2019-01-03 15:30 | Report Abuse

It is a real pleasure to learn from long numbers guy. Instead of the analysis, we need to look at his thinking/mental models about stocks. Long numbers guy did not claim to be an expert on Airasia. I believe the homework he done on QL is much more than the effort he put into Airasia. It was me who asked about long numbers guy two cents on Airasia. Most i3 members who trades Airasia does not look at Airasia from a business perspective. Most would pull out a few tables and charts, telling you oil price have gone down and it is time to buy for possible explosive earnings in the next few quarters after applying 10x PE. Nobody on i3 have ever assessed Airasia competitive position before, aside from another sifu Felicity. Having the ability to understand competitive advantages do not happen overnight. It takes experience, lots of reading and most importantly, an open mind.

Posted by 10154899906070843 > 2019-01-03 16:48 | Report Abuse

Hi Godhand, I agree with you totally, air Asia is another tier. But answer me this, how hard is the industry to get into? Basically anyone can go into it, if you have guts, the loans and the air license to run. Langkawi proved it. But just because that idiot failed doesn't mean that there won't be idiots who try to do the same thing by selling cheaper

Basically Tony is not an air man. He was a music producer who bought the old airline license, got a loan from sdb, bought the license for rm1 with all it's debt and got it off and running.

Now he did take a page out of virgin by adding ancillaries to increase the margins and generate good profit to grow and run the business until today.

But if you think air Asia has a moat, consider the fact how many flights are coming in and out of Malaysia. As a passenger, the moment air Asia stops becoming cheaper and more reliable than the other LCC, I'll stop using them and use next cheaper and reliable carrier. Tell me if that is not true. If you don't have pricing power, you don't have a moat.

As for ancillary profits, the moment passenger loads drop, all those items just disappear, you can't sell food if no one flies. And if planes are stranded, they can't make money.

And the most important thing is safety of margin. The risk of your plants and warehouse disappearing for QL is pretty much zero. For air Asia, it's a very real risk, and something they can't control.

Just imagine a scenario where 1 plane disappears in the Indian ocean. Not only do you have do compensation for the guaranteed human loses, you have to buy a new plane, but more importantly the loss of confidence the public is damage can go far beyond anything that can be repaired. The loss of profits will be instantaneous and unforseen. This is one of the factors of undervaluation of AA. Tell me I'm wrong.

Just ask Malaysian airlines.

And for me I prefer to compare AA not to QL but more to an insurance company in terms of business model. It rains far more from the float reinvestment to increase it's profits, but at the same time any overstretching of resources will kill the company in the case of any big disaster.

Everyone always things off growth and profits. But what you really need to think about is also safety of business margin.

Posted by moneySIFU > 2019-01-03 16:58 | Report Abuse

Very meaningful comments here, thanks for sharing your thoughts, 10154899906070843.

Posted by moneySIFU > 2019-01-03 17:01 | Report Abuse

In order to change your ID/name, you can go to:
1. Member Services
2. Edit Profile
3. Edit your first name, then save changes

Then do this again if no change:
1. Edit Profile
2. Select "Display Name"

Posted by 10154899906070843 > 2019-01-03 17:07 | Report Abuse

Ahhh,I see. Thanks so much

Posted by moneySIFU > 2019-01-03 17:12 | Report Abuse

Welcome, good to see good sharing here. Keep it up, and please ignore any unpleasant noise, if any :)

Posted by Shinnzaii > 2019-01-03 18:18 | Report Abuse

Long number guy is right "Everyone always things off growth and profits. But what you really need to think about is also safety of business margin." Airline business is risky business...one AA plane crash can become like MAS...

Posted by Sslee > 2019-01-03 18:24 | Report Abuse

Dear Mr. Phillip Fisher,
I do not know why I cannot paste in the comment in QL forum. Hence I post my responds in my blog.

https://klse.i3investor.com/blogs/Sslee_blog/188711.jsp

Thank you

Posted by Choivo Capital > 2019-01-03 18:34 | Report Abuse

His analysis on Airasia is not wrong though. Very similar to mine.

And its the only one other than public bank in his portfolio where the valuation does not make you want to vomit blood.