Invest
[Case Study] 105% Gain On A Smartphone Camera Module Manufacturer – Cowell (SEHK:1415)
By Dr Wealth  •  May 14, 2020

It was 9 Feb 2019 and Cowell (SEHK:1415) was one of the stocks I presented during our Graduates’ Gathering. I mentioned that the stock price was beaten down probably because of poor iPhone sales in China – Cowell makes camera modules for smartphones and Apple was one of their customers.

I calculated a conservative valuation of their net assets (CNAV) to be HK$1.39 per share. The share price was trading around HK$1. Hence, it was undervalued.

The assets were decent too with about 20% in cash. The largest asset was receivables but I wasn’t concern because the customers were big names like Apple, Samsung and LG. Cowell will eventually get the money from them. Likewise, the inventories are materials and camera modules that are contracted to these customers. Nonetheless, I played it safe and discount these assets by 50%. Even so, I still arrived at a value ($1.39) higher

...
Read the full article
By Dr Wealth
Dr Wealth provides trusted financial education to individuals. We teach researched and actionable investment methods so that our graduates are successful in their investment journey and achieve market-beating returns.
LEAVE A COMMENT
LEAVE A COMMENT

Your email address will not be published.

*

Your Email Address will not be published
*

Read More Articles
More from thefinance