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Level13

My view on Bright World takeover (Part 1)

September 25, 2008 by Level13
By: Level13 This write-up on Bright World (BW) is divided into 2 parts. It contains my deductions based on publicly available info on the takeover of BW. Before I begin, please take note that i am vested in BW and my views may be biased. What is mentioned in this posting cannot and should not […]
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Value in textile industry? No way!

September 7, 2008 by Level13
By: Level13 Below is a recent recommendation by one of the brokerage companies on the SGX comapnies involved in the textile industry: Risk-reward ratio getting attractive. In fact, these textile companies are generally financially sound. They are in net cash position and are still garnering lucrative net margin of 26%-30%, rewarding investors with adecent ROE […]

in Categories: Investing

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Price Movement

August 12, 2008 by Level13
By: Level13 This posting is not to encourage readers to trade. For most people, it has been proven that constant trading is detrimental to their investment return. However, as a retail investor, we should have a general knowledge of the signals that the price movement is indicating to us. The price movement of a stock […]

in Categories: Investing

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Temasek reduces Merrill Lynch stake – True or False

July 28, 2008 by Level13
Though it has been confirmed to be incorrect now, Level13 shares his view on how one should always double check on the reports and not follow blindly. By: Level13 Before you come to the conclusion that Temasek has made a lousy investment decision which has resulted in losses, it seems like nobody can verify on […]

in Categories: Investing

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RTO = Ready to offload

July 13, 2008 by Level13
By: Level13 In the Business Times on Thursday: Backdoor listing is the flavour of the season as companies are taking the reverse takeover (RTO) route to the stock exchange instead of initial public offerings (IPOs). In the first half of this year, the value of announced reverse takeovers (RTOs) on the Singapore Exchange surged to […]

in Categories: Investing

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Who’s the real culprit?

July 6, 2008 by Level13
By: Level13 Below are some of the versions we read about recently on the reasons behind the relentless price increase of commodities. VERSION 1: Speculators In the current global economic slowdown, it would be fundamentally reasonable to assume that consumption has gone down and prices have weakened. This indeed is the case for lead, zinc […]

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Competitive advantage period (CAP) — Part 3

July 2, 2008 by Level13
By: Level13 The CAP for the U.S. stock market, as a whole, is estimated to be between 10 and15 years. However, within that aggregate, individual company CAPs can vary from 0-2 years to over 20 years. As a general rule, companies with low multiples tend to have shorter CAPs. Alternatively, companies with high multiples typically […]

in Categories: Investing

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Competitive advantage period (CAP) — Part 2

June 8, 2008 by Level13
By: Level13 Competitive advantage period (CAP) is the time during which a company is expected to generate returns on incremental investment that exceed its cost of capital. Economic theory suggests that competitive forces will drive returns down to the cost of capital over time. If a company earns above market required returns, it will attract […]

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Competitive advantage period (CAP) — Part 1

June 7, 2008 by Level13
By: Level13 In 1991, Barrie Wigmore, a Goldman Sachs limited partner, released a study that attempted to determine what factors drove the stock market’s above-average returns in the decade of the 1980s. After carefully accounting for earnings growth, interest rate declines, M&A activity and analysts’ rosy forecasts, it appeared a full 38% of the shareholder […]

in Categories: Investing

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Economic Value Added (EVA) Ratio

April 22, 2008 by Level13
By: Level13 Economic Value Added (EVA) is a frequently used ratio by investors from developed market economies. The basic idea of this formula is based on the foundation that the main goal of a company is to maximize profit. However it does not mean book profit (the difference between revenues and costs) but economical profit. […]

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What is Competitive Advantage?

April 4, 2008 by Level13
By: Level13 The true definition i got from the internet for competitive advantage is as follows: An advantage that a firm has over its competitors, allowing it to generate greater sales or margins and/or retain more customers than its competition. Competitive advantages give a company an edge over its rivals and an ability to generate […]

in Categories: Investing

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Acquiring a business – How not to do it (China Powerplus case)

March 24, 2008 by Level13
By: Level13 Investors need to evaluate motives for a merger in order to asses whether the newly formed entity is likely to create long-term value or not. There are numerous questions concerning motives for any merger that need to be asked and answered when evaluating the new company. Among others, investors need to know if […]
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