Author: AlpacaInvestments

UPDATE ON FAR EAST ORCHARD

A reader wrote to me asking for my thoughts regarding some questions about Far East Orchard (FEO). I am vested in FEO at a price of $1.52, a position I initiated back in August this year. Since then, its share price has been largely flat, trading between a range of $1.46 to $1.59. Third Quarter Results FEO’s 3rd quarter results were largely disappointing, with revenue down 20.7% and net profit falling by 74.2% year on year. The decline in revenue was due to the completion of some lease agreements in Australia and New Zealand, and weaker performance of assets...

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2017 IN REVIEW

Started this blog in February this year, with the aim of encouraging more young adults to begin their investing journey. I’ve spoken to many young adults who believe that investing is out of their reach, when in reality, even if your capital isn’t large, you can still start with a monthly dollar cost averaging strategy. I hope that by penning down my thoughts regarding my investing experience, more young adults would take the initiative to find out more about investing.Read: Why you should start investing earlyAs I’ve gained more investing experience, I have also fine-tuned my process of identifying...

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JAPAN FOODS HOLDING

Japan Foods Holding (JFH) has recently caught my attention, after I have started screening for stocks again. JFH operates a wide range of F&B outlets selling Japanese food. We may be familiar with the Ajisen Ramen brand, which accounts for the bulk of JFH’s revenue (39.5%). JFH also operates brands including Menya Musashi and Keika Ramen. JFH has operations in Singapore, Malaysia, Vietnam, Hong Kong and China. JFH Annual Report 2017 JFH has a four pronged strategy to grow its business – developing new concepts, cost control, overseas expansion and network expansion/consolidation. 1H 2018 Financial Results For 1H 2018,...

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KEEPING AN EYE ON ST ENGINEERING

ST Engineering (STE) has performed poorly for the past few months, and I have added it to my watchlist. STE is an integrated engineering group with 4 main business segments – Aerospace, Electronics, Marine and Land Systems. For FY 2016, the group generated $6.68 billion in revenue and $484.5 million in net profit, representing a net profit margin of 7.2%. The revenue breakdown was 65% from commercial sales and 35% from defence sales. Earnings per share was 15.6 cents, and the group distributed 15.0 cents of dividends to shareholders.STE Annual Report 2016This year, 9M 2017 earnings per share stands...

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NOVEMBER TRANSACTIONS

I’ve been quite busy lately, as I’m in the midst of having my examinations, so I’ve not been able to write much. For November, these are the transactions I made, as well as some updates on the companies that I’m holding: I bought SingTel at $3.67 last week, which makes SingTel my third largest position. SingTel’s special dividend of 3.0 cents from the proceeds of the NetLink Trust IPO was deemed to be underwhelming by the market, hence its share price declined after it announced its third quarter results. I believe that paying out only 3.0 cents may not...

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QAF LIMITED REVISITED: DISAPPOINTING 3RD QUARTER

At some point in our lives, we may have consumed the Gardenia brand of bread for breakfast, as it is a familiar household name. However, QAF Limited may sound a little more unfamiliar to us. I didn’t know about the link between these two names, until I began researching on QAF Limited. Gardenia bread is actually produced by QAF Limited, a company whose operating segments include bakeries, primary production and trading & logistics. I had previously written about QAF Limited in May this year. 3rd Quarter PerformanceQAF’s third quarter results were rather disappointing, with net profit falling by 62%. Even...

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MAPLETREE COMMERCIAL TRUST OR STARHILL GLOBAL REIT?

Mapletree Business City, Source: MCT website I’ve been looking at Mapletree Commercial Trust and Starhill Global REIT recently, so I’ll be writing on how these two REITs stack up against each other. Our local REIT sector has performed well this year, with many REITs surpassing their 52-week highs during the past month. Unfortunately, I’ve largely missed out on this rally. However, I believe that some REITs still present some value, together with a decent dividend yield. For some background, the first two stocks that I purchased were Ascendas REIT and CapitaMall Trust, back in 2015. However, with the probability...

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ARE SINGTEL’S DIVIDENDS SUSTAINABLE?

After SingTel’s successful listing of NetLink Trust (NLT) in July, SingTel has reduced its effective stake in NLT to 24.99%. In the process, SingTel received a huge windfall, with an excess of $1 billion in cash. There has been much speculation of whether a special dividend would be declared. SingTel is expected to use some of these proceeds to pare down its debt or to expand its core business. As for the remaining IPO proceeds, I believe that there is a chance for a special dividend to be declared. The focus on my post would be to evaluate whether...

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SEPTEMBER TRANSACTIONS

For September, there’s not much to update, as I had only executed one transaction. Latest portfolio holdings can be found here: My PortfolioPurchased Jumbo at $0.54, because I am positive on their move to expand into Asia. As of yesterday, Jumbo closed at $0.57, which represented a 5.6% gain. This is a long term holding as I await their expansions plans to unfold. Nonetheless, if Jumbo were to surge to an extremely high valuation, such as a price earnings ratio of above 30, I would consider selling. More details can be found in my earlier post: Jumbo at 52-week...

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COMFORTDELGRO PART 2: VALUING ITS TAXI BUSINESS

This post is a continuation from my article on ComfortDelGro’s valuation yesterday. Previous article: ComfortDelGro: A safe entry price? In my previous article, I had arrived at a valuation for CDG’s taxi business segment, using its net asset value. As some users on InvestingNote have pointed out, using CDG’s net asset value may not be the most appropriate valuation method, as the vehicles may not be liquidated at book value. Based on the feedback, I’ve revised my calculations, to take into account the projected fall in taxi fleet numbers, revenue, profit margins and earnings. Valuation of Taxi Segment Here’s...

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COMFORTDELGRO: A SAFE ENTRY PRICE?

ComfortDelGro has been on my watchlist since early this year, when it was trading at around $2.40. In my earlier post in February, I assigned a target price of $2.17 for CDG, on expectations that taxi earnings would be hit by the intense competition with private hire operators. Subsequently, CDG ran up to a high of $2.70 before going on a prolonged decline, and closed at a price of $2.08 yesterday. When CDG hit $2.17 a month ago, I did not initiate a position because I felt that its fundamentals have worsened. I have summarised my thoughts on CDG....

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MY PORTFOLIO

Average Cost Price (SGD) % of Portfolio STI ETF 2.78 24.79% DBS 15.00 19.21% SGX 6.99 12.57% Jumbo 0.54 11.67% Far East Orchard 1.52 8.37% Cash – 23.38% After much consideration, I’ve decided to reveal the current holdings in my portfolio. My portfolio is a low five-figure sum, which I have accumulated from my savings, National Service allowance and working part-time jobs. I started investing in mid-2015, while I was in National Service. Looking back, mid-2015 was probably the worst time to start, as the markets began to decline due to the sharp fall in oil prices and fears...

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JUMBO AT 52-WEEK LOW

I have been monitoring Jumbo’s stock for the past few months. After a spectacular run up since its IPO, Jumbo’s share price hit an all time high of $0.79 earlier this year. At that point, Jumbo stock was trading at a P/E ratio of 30, which reflected the market’s strong optimistic sentiment, along with expectations that Jumbo would continue to report strong growth in its earnings. After two quarters of reporting flat earnings, Jumbo’s share price has tumbled to a 52-week low of $0.53. This shows us how emotion driven the market can be in the short term –...

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AUGUST TRANSACTIONS

1) Divested NetLink Trust at $0.805, because I expected the cessation of the stabilising purchases to have an adverse impact on the share price, similar to HRnetGroup two months ago. However, on hindsight, this was a speculative decision and probably shouldn’t have been a strong reason to exit, given that the fundamentals haven’t changed and NetLink’s dominant position in the fibre broadband market. Since my divestment, NetLink’s share price has risen by around 4-5%. The strong performance recently can probably be attributed to expectations that the pace of rate hikes will be slowed, which benefits high dividend yielding stocks, as well...

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