Remember the LORD for it is he who gives you the ability to produce wealth and so confirms his covenant... Deut. 8:18

Saturday, March 20, 2010

Plantation Co. Quarterly EPS

Here's a simple analysis to determine if the stock shares you intend to buy is undervalued or overpriced. First find out its Quaterly earning per share (Q eps). Then multiply by 4 to estimate its annualised/yearly earnings. Then multiply by PE ratio 10. (PE Ratio simply means the price I paid for its share today, the company should in 10 years time match it with all its accumulated earnings, theorectically).
So simple Fair Value or Price = Q eps x 4 x 10.

Boustead (latest Q eps 16.2 sen, nta RM4.20). Fair Value Fv = 16 x 4 x 10 = RM6.40
At RM3.40 ( ex. 16/3, 6 sen t.e. + 4 sen taxable), it's very attractively priced at abt 55% of its fair value. The only issue is whether the Q eps is sustainable in the following quaters.

TDM (latest Q eps 9.7 sen, nta RM2.88 ). Fv = 9.7 x 4 x 10 = RM3.88
At RM1.70, it's attractively priced at 46% of its Fv. Still holding on to mine as I expect it to declare 14 sen dividend (approx. 8 %) in June.

Will post HS Plant, TH Plant, IJM Plant, Unico, Kim Loong, TSH later or 2moro...


maksu said...

Can you help me with the dividend calculation.
For TDM u mentioned 14 sen dividend (8 %). The question is if I have 10 lots (10000 units) of TDM shares, how do I derive the dividend that I will get. Is it 10000 X 0.41 or 10000 X 8%. If there is tax then I have to minus 25% from the dividend amount.

How about this scenario then:
Single Tier Dividend of 14.5%
Entitlement indicator:Percentage
Entitlement in percentage (%):14.5

Hope you can help.

Remnant 613 said...

Assume TDM priced at RM1.70 per share. If you have 10,000 shares x RM1.70 = RM17,000-00.

Assume dividend/share declared is 14 sen tax-exempted, then 10,000 shares x 14 sen = 140,000 sen = RM1,400

TDM last year paid 14 sen taxable 25%, so nett dividend is RM1,050. You can claim back part of the tax paid if yr taxable income bracket is less than 25%.

TDM last year dividend may not be repeated this year. It may be higher, may be lower, may be zero, depending on mgmt decision. So you buy at yr own assessment and decision, ok..?

Plantation counter shares are for really long term investment. Bear this in mind.

If the dividend is quoted in %, then you need to look up the par value of the Co. share.
If Par value = RM1.00 then 14.5% dvd most likely means 14.5 sen
If Par value is RM0.50, then 14.5% dvd is likely to mean 7.25 sen

Hui Hui said...

Hi Remnant 888

Not easy to get good and informative blogs like this. Tks for yr guide on calculating FV. Helps a lot. Plsd to note on yr quotes. I believed my prayers brought me to the investing fraternity but some times I do wonder whether I'm right or not, I mean whether investing in stock market is some form of gambling. But now I should know the answer and I can now offer my tithes with ease. Tks & God Bless You, vivien

Remnant 613 said...

So glad the blog is to helpful to many.
My prayer is that the readers/bloggers not only be blessed financially but also spiritually by mystery of God, namely Christ.
Being blessed spiritually will bring true happiness, fulfillment and purpose in life.
Our goal is not to chase money but to be successful in all we are/do so that money ccomes to us. make sense..?