Thursday, April 1, 2010

Fortune REIT -CIMB

Fortune REIT (FRT SP; HK$3.57) – BUY

FY11P/E: 15.5x, P/BV: 0.7x
• We are cautious on the stock’s uptrend and we doubt the sustainability given the uptrend from February is just too steep. Since prices have yet to fall below, we cannot discount that prices could continue to climb higher towards HK$3.76 and HK$3.90.

• Both MACD and RSI are still on a rising trend but the rate of the rise is beginning to flatten, suggesting a slowing momentum.

• The stock remains a buy but bulls should be very cautious at current levels. If prices closed below the support trend line at HK$3.50 and the key support at HK$3.40, the uptrend is likely exhausted

Wednesday, March 31, 2010

Fortune REIT -DMG

Fortune REIT confirms dual listing plans in Hong Kong (SGXNET)

The news: Fortune REIT announced that it is to list in Hong Kong by way of introduction where it would commence trading on 20 Apr 10. The company had also previously mentioned that it would usually take up to 13 business days should one were to trade their SGX-listed units in Hong Kong.

Our thoughts: We believe that the Fortune REIT’s share price may receive a boost today even though it had already depicted a jump back during 24 Feb 10 when it first announced its dual listing plans, as official confirmation was only given this morning. Additionally, given that some market observers may have frowned when it was revealed that the company is to list by way of introduction rather than through the issue of new shares as the SEHK had seemed to prefer IPOs a few months previously, we opine that this development would negate any worries that Fortune REIT would be unable to list in Hong Kong.

Fajarbaru (MY) -KN

Fajarbaru Builder Group
BUY RM1.06
Target Price: RM1.32

Competition heating up for LCCT contract

Not entirely negative to Fajarbaru. News that Bina Puri Holdings and UEM may win the RM1b LCCT terminal contract should not be viewed too negatively on Fajarbaru. As the contract has not been awarded and Malaysian Airports have not made any official announcement on which shortlisted-prequalified contracts have been dropped from the bid for the terminal building, there is still a chance that Fajarbaru may secure the contract or part of it.

Healthy order book at c. RM450m until CY2012. At present, Fajarbaru is tendering another RM700m worth of contracts with a mix of government and private projects including parking apron works for Malaysia Airports.

Projects including
a) Double Track Railway,
b) Tampin Hospital
c) shrimp farm at Terengganu

Bidding LCCT projects - RM300m to RM400m.
(We also believe Fajarbaru stands a chance to secure sub-contracts from the LCCT contract winners.)

BUY maintained with lower TP RM1.32. (Previously RM1.61). Overall slowdown in awarding major contracts, will slowdown the growth of the construction sector. The intense competition has reduced bid-award strike rates substantially. We revised down our FY10 and FY11 earnings by 24% and 3% respectively, factoring in slower progressive recognition of works and delays in award of new contracts. We still pegged Fajarbaru at 10x PE to FY10 EPS yielding a lower TP at RM1.32.

Tuesday, March 30, 2010

Fortune REIT -CIMB

Fortune REIT (FRT SP; HK$3.61)

• Fortune REIT has cleared another step in relation to its proposed dual primary listing on the Main Board of the Stock Exchange of Hong Kong (SEHK).

• Today the company announced that it has gained approval for the authorisation of its stock from the Securities and Futures Commission of Hong Kong (SFC) and special
arrangements have been made to facilitate the transfer of units by existing shareholders of Fortune REIT.

• Subject to the final approval from the SEHK for the listing of and permission to deal in the units on the SEHK, trading of Fortune REIT is expected to commence on the Hong Kong Main Board at 10am (Hong Kong time) on 20 April 2010.

• We expect the news to have a positive impact on the company’s share price

Insider Trades – Follow Them Legally And Accurately

How do we pick the right ones to follow?

First, what are “insiders” and “insider trades”?

“Insiders” are broadly defined as a company’s officers, directors and any substantial shareholders of the company. Insider trading has typically been labeled with negative connotations. However, there are two types of insider trading, namely illegal and legal insider trading.

So, why do we follow insider trades?
Typically, insiders would have an idea on the health of the company and its prospects. For example, information on the company’s order flow, prospects, competition, potential risks and its financial health should be at the finger tips of senior management such as the Chief Executive Officer (CEO). These insiders are likely to have access to higher quality information and at an earlier pace than analysts, portfolio managers and almost certainly, individual investors.

According to Market Profile Theorem, an independent research firm and provider of Behavioral Financial models, integrating Insider, Earnings, Technical and Style aspects, for 20-years, found out that, on the aggregate, insider trades do signal an up-and-coming shift in market sentiment. What does up-and-coming shift in market sentiment mean? This means if there are still many insider purchases of the company’s shares from different senior management, despite the sliding share price, then this may provide a signal that the share price may reverse its decline and start to rise in the medium term.

Which are the right insider trades to follow?
Some insiders are more reliable than other insiders, due in part to their job scopes, situational factors and track record. Firstly, a senior executive working in the Human Resource Department is likely to have less information than the Chief Operating Officer (COO) due to the job scope and responsibilities. Secondly, non executive directors are likely to have less information than key executives, such as the CEO and COO in the company. This is because key executives, through their daily management of the company’s business operations, would have the most updated information on the company’s prospects.

The other two situations depend more on situational factors. Firstly, an executive holding a financial controller (FC) designation in a small firm is likely to have more information than his peer in a big multinational firm. This is because information is more dispersed in a big organisation and only the upper management team such as the CEO has the overall picture. Secondly, some companies require newly appointed executives and directors to own shares. Thus, this kind of stock purchases by newly appointed executives and directors should not warrant too much attention as it is their company’s requirements.

Some insiders have better track record than others due to their astute ability in analysing the information and knowing what kind of information is important to the company and investors. Thus, before following an insider trade made by the CEO, your odds of being correct would increase if you can also assess the CEO’s track record in making insider trades.

Patience pays
Insiders typically react earlier and trade in advance of expected news. This is to prevent the appearance of insider trading. Thus, for investors who want to follow insiders, they should be mentally prepared to hold the company’s shares for the medium term.

The more, the merrier
The greater the number of insider trades, the higher the probability that the signal generated from the insider trades is valid. This is because a series of trades made by three of more insiders show a general consensus of opinion regarding the company’s prospects.

Insider purchases are more reliable than insider sales
In general, insider buys have generated more reliable results than insider sales. This is straightforward as typically people buy to make money. Thus, if they are willing to risk their hard earned money by buying the company’s shares, then it is likely that they have good reasons to do so.

On the contrary, there can be a myriad of reasons why insiders choose to sell the shares. Even if they feel that the company is a sound one, they may sell the shares for portfolio diversification purposes. They may also sell the shares as they require cash for housing, or for their children. Therefore, it is noteworthy that insider purchases are more reliable than insider sales.

Conclusion – follow shrewdly
Insider trades, especially insider purchases are a good starting point to further investigate a company. Therefore, readers who learn how to follow the right insider trades would likely see improvement in their portfolio performance. Nevertheless, I hasten to emphasise that readers should not use insider trades as a singular tool for the selection of investments. This should be used in conjunction with proper fundamental and technical analysis.
Warren E. Buffett(沃伦•巴菲特)
Be fearful when others are greedy, and be greedy when others are fearful
别人贪婪时我恐惧, 别人恐惧时我贪婪
投资只需学好两门课: 一,是如何给企业估值,二,是如何看待股市波动
吉姆·罗杰斯(Jim Rogers)

乔治·索罗斯(George Soros)



高估期间, 卖对, 不卖也对, 买是错的。
低估期间, 买对, 不买也是对, 卖是错的。

Tan Teng Boo

There’s no such thing as defensive stocks.Every stock can be defensive depending on what price you pay for it and what value you get,
  • Selected Indexes 52 week range

  • Margin of Safety

    Investment Clock

    World's First Interactive Investment Clock