Right move by Haio by streamlining the organisation structure. It will be added advantage if BESHOME can aim for Halal certificate for their products since major of their customers are Malay.
Est next quarter results will drop further amid prolonged mco which affected normal workers rice bowl. Anyway, dividend is generous under this market conditions. Hopefully no more shares buy back as it may benefit insiders, available cash is better to pay investor generously.
Heart is very heavy when know about the death of Mr Tan, he is not a typical businessman who's only think about himself or craving for money, he is a fighter in politics before start up business, and great philanthropist as well, feel deep sorry and sad to know about this
Looks like market is anticipating BESHOM to cut the final dividend from 5 sen last year. I am half expecting 3 sen which is not a bad dividend to get, to bring total dividend to 6 sen, for a total dividend yield of 5%, based on 1.19 price. MLM division is now much smaller than peak, has become smaller than Wholesale division and comparable to Retail division, MLM can still go down (or up), but like to think most of the damage is done - however, this statement is speculative, and probably better to wait and see if bottom is really there or not. They manage to grow both Wholesale and Retail division, so, won't write them off as dead yet ...
I may consider at around 83 Sen. For a stock like this, I need 6% dividend yield and since dividend has been cut to 5 Sen, when the price drops to 83 sen, it works out at 6% dividend yield.
There are so many stocks with better looking long term price charts than BESHOM and pays over 6% dividend yield. Little point to consider this dying stock.
BAT is another stock on long term downtrend, but at least it’s paying over 8% dividend yield. Logically if you want to pick bottom in downtrending stock, at least do it in BAT than BESHOM.
A stock like BESHOM on such long term downtrend, is more likely to continue its downtrend. If could try to find a base but uncertain and would take a very long time. This type of stock is better left alone for several years before looking into it again. It’s not going to zoom up in straight line.
EPS has been dropping continuously 6 years in a row, from peak EPS of 27.5 sen in 2017. Since then: 2017 - 27.5 sen 2018 - 25.8 sen 2019 - 16.3 sen 2020 - 11.1 sen 2021 - 13.5 sen (hope?) 2022 - 9.8 sen (what!) 2023 - 5.4 sen (what!!)
The latest EPS (5.4 sen) is less than 20% of what it used to be in 2017 (27.5 sen). The stock price today (RM1) is also less than 20% of what it used to be in 2017 (RM5)
From dividend policy perspective, I admire this stock because it always share its profits with shareholders. On average it pays out 80% of its EPS as DPS and I like this very much. I also like its Net Cash position too.
However, the only problem is its underlying business EPS. Its profits is shrinking ... and shrinking ... and shrinking ... and shrinking .... and shrinking ... It's been shrinking since 2017.
Share price has no bounce. This one, cannot do anything ... just let it be. Either it dies a natural death over time ... or one day, Management is able to arrest the decline in EPS to be higher than 6 sen to breathe some life into this dying stock and dying business.
This book is the result of the author's many years of experience and observation throughout his 26 years in the stockbroking industry. It was written for general public to learn to invest based on facts and not on fantasies or hearsay....
Najib Zamry
850 posts
Posted by Najib Zamry > 2021-01-20 10:10 | Report Abuse
Right move by Haio by streamlining the organisation structure. It will be added advantage if BESHOME can aim for Halal certificate for their products since major of their customers are Malay.