December 16, 2013

Warren Buffett’s 2013 Top-10 Stocks

Warren Buffett, the CEO and largest shareholder of Berkshire Hathaway (NYSE: BRK.A, stock) is one of the wealthiest men on planet Earth. Every now and then, he would trim his holdings while add other stocks into his portfolio. In June 2013 alone, he added stocks like General Motors, Wells Fargo, VeriSign, National Oilwell Verco and Bank of New York Mellon. He also reduced his holdings such as Moody’s Corp, Kraft Foods and Mondelez International in the same month. Due to the fact that Warren is a long-term investor, many investors follow his investment portfolio for obvious reason.
Warren Buffett Coca Cola
Fortunately, United States makes it a mandatory requirement for any fund managers who oversee more than US$100 million in assets to declare their equity holdings in a quarterly report – Securities and Exchange Commission’s 13-F report. This must be filled within 45 days of the end of each quarter. Hence, this quarterly report provides an opportunity for Warren Buffett wannabe investors to have a glance on what the Oracle of Omaha had bought in the previous quarter. For example Warren Buffett had added new stocks to his portfolio in June 2013 - Suncor Energy and DISH Network to the tune of 0.59% (17,769,457 shares) and 0.03% (547,312) stakes respectively.

Here’re Warren Buffet Top-10 stocks, via his Berkshire investment arm, which could make you some money as at the end of June 2013:

[ 10 ]  Moody’s Corporation (MCO)Year-To-Date: 28.3%
Warrent Buffett Top-10 Stocks 2013 - MCO Chart
Berkshire reduced its shares in the ratings agency during the second quarter, but still held 24.9 million shares, worth US$1.52 billion at the end of June 2013.


[ 9 ] DaVita HealthCare Partners (DVA)Year-To-Date: 1.5%
Warrent Buffett Top-10 Stocks 2013 - DVA Chart
The stake in the healthcare company is most likely the work of Buffett’s managers, Ted Weschler and Todd Comb, but Berkshire held nearly 15 million shares, worth US$1.81 billion at the end of June.


[ 8 ] DIRECTV (DTV)Year-To-Date: 18.9%
Warrent Buffett Top-10 Stocks 2013 - DTV Chart
Berkshire held 37.3 million shares of the satellite provider at the end of the second quarter, worth $2.3 billion. In comparison, Berkshire’s new position in DISH Network was valued at US$524 million.


[ 7 ] U.S. Bancorp (USB)Year-To-Date: 15.7%
Warrent Buffett Top-10 Stocks 2013 - USB Chart
The Minnesota-based bank was in high demand at Berkshire as the firm increased its stake by almost 17 million shares to 78.3 million shares during the second quarter, worth US$2.83 billion.


[ 6 ] Wal-Mart (WMT) Year-To-Date: 8.6%
Warrent Buffett Top-10 Stocks 2013 - WMT Chart
Berkshire held 49.2 million shares of the world’s largest retailer at the end of the second quarter, worth US$3.67 billion.


[ 5 ] Procter & Gamble (PG) Year-To-Date: 17.7%
Warrent Buffett Top-10 Stocks 2013 - PG Chart
During the second quarter, Berkshire kept its stake in the Ohio-based company at 52.8 million shares, worth US$4.06 billion.


[ 4 ] American Express (AXP) Year-To-Date: 30.9%
Warrent Buffett Top-10 Stocks 2013 - AXP Chart
Berkshire held 151.6 million shares of the credit card giant at the end of the second quarter, worth US$11.33 billion.


[ 3 ] International Business Machines (IBM) Year-To-Date: -3.1%
Warrent Buffett Top-10 Stocks 2013 - IBM Chart
The information technology is the most influential blue chip in the Dow Jones Industrial Average, and one of Buffett’s biggest holdings. Berkshire held 68.1 million shares of IBM at the end of the second quarter, worth US$13.02 billion.


[ 2 ] The Coca-Cola Company (KO)Year-To-Date: 7.6%
Warrent Buffett Top-10 Stocks 2013 - KO Chart
Berkshire held 400 million shares of the world-known beverage company at the end of the second quarter, worth US$16.04 billion.


[ 1 ] Wells Fargo (WFC)Year-To-Date: 25.2%
Warrent Buffett Top-10 Stocks 2013 - WFC Chart
The nation’s largest bank by market capitalization is also Buffett’s top holding. Berkshire held 463.1 million shares of Wells Fargo at the end of the second quarter, worth US$19.1 billion.

December 10, 2013

Site Moving To:http://networkingcapital.blogspot.com/

Dear all readers,

It is happy to have you all these years, my blog is moving into new website I have recently created:
http://networkingcapital.blogspot.com/

I think this new website will be more helpful and relevant to you all as I will do some detail analysis of stocks in the blog, also updated with latest development of the stocks covered.

However, this website will still remain and some important posts to be moved into the new sites slowly.

Love to have you all these years. See you all in new sites and HAPPY 2013, WELCOME 2014!


November 30, 2013

Insas and Graham Join in late at 0.685 but still more than 50% to NAV. Another excellent FA by kcchongnz

In 1932 at the bottom of the Great Crash, Ben Graham wrote an article on Forbes about the cheapness of the market and how companies are being quoted in the market for much less than their liquidating value, as if they were all destined to be doomed. He called these types of stocks, "net nets", companies that sell for less than its net current asset value, or net net working capital. Graham used the following formula to compute the liquidation value of a company.

Net Net Working Capital = Cash and short-term investments + (0.75 * accounts receivable) + (0.5 * inventory) – total liabilities

It's the lowest form of valuation you could possibly do because it ignores everything about the business and just focuses on tangible assets. The formula states that;
• cash and short term investments are worth 100% of its value
• accounts receivables should be taken at 75% of its stated value because some might not be collectible
• take 50% off inventories, due to discounting if close outs occur

Insas’s latest balance sheet as at 30 June 2013 was used to compute the net tangible asset and Graham net net values. Besides cash, the net net values of quoted and unquoted investments owned are also taken as 100% of the book value. Note that tax assets, property, plant and equipment, Goodwill and “other assets” are taken as worth nothing.

The appended table shows that the Graham net-net value of Insas is RM1.23. This is more than twice its closing price of 64 sen on 30 October 2013.

Besides Insas has been profit averaging 6 sen per share for the last 10 years. It has on average positive free cash flow and a healthy balance sheet.

Why is Insas trading at such a big discount to its Graham net net value? I guess is investors have not much trust in the management in maximizing minority shareholder value. No dividends have been declared until recently, although it has been buying back its shares.

So with the beginning of this more tangible dividend distribution, will Insas be re-rated in accordance with its value?

Insas Graham net net (693,334,000 shares)
Cash and equivalent 532,894 100% 532894
Investments 120,290 100% 120290
Investment properties 151,432 100% 151432
Associate companies 90,145.63 100% 90146
Receivables 345,289 75% 258967
Inventories 15,830.73 50% 7915
PPE 59,765 30% 17929
Other assets 43,503 0% 0
Total assets 1,359,150 xxxx 1179574
Total liabilities -325,949 100% -325949
Net assets 1,033,201 xxxx 853,625

No. of shares 693,334 xxxx 693,334
NTA/NBV 1.49 xxxx 1.23; NTA IS ALSO THE FAIR VALUE
04/11/2013 11:15

November 28, 2013

Inari: Growing Stronger

from http://bursadummy.blogspot.com/2013/11/inari-growing-stronger.html
Inari FY14Q1 Financial Result
INARI FY14Q1 FY13Q4 FY13Q3 FY13Q2 FY13Q1 FY12Q4
Revenue 191.3 67.6 56.8 62.1 54.6 41.8
PBT 22.1 13.5 8.3 11.3 10.2 3.8
PBT% 11.6 20.0 14.6 18.2 18.7 9.1
PAT 21.0 13.1 12.4 8.7 7.4 5.1







Total Equity 176.8 153.4 110.0 97.6 94.3 82.9
Total Assets 406.2 366.4 181.3 176.2 164.3 148.6
T/Receivables 121.1 93.0 38.6 36.8 39.5 24.4
Inventories 107.4 105.5 24.7 24.5 24.0 22.2
Cash 48.9 44.6 31.0 39.2 34.0 40.8







Total Liab 230.0 213.8 71.3 78.6 70.0 65.7
T/Payables 138.7 120.2 48.0 54.2 52.9 48.3
ST Borrow 19.6 20.4 5.5 4.6 4.6 4.5
LT Borrow 17.8 10.3 13.3 8.8 7.2 8.4







Net CF 4.3 3.8 -9.9 -1.6 -6.6 25.2
Operation 7.2 86.3 20.1 17.6 0.4 22.7
Investment -9.6 -112.2 -31.1 -17.2 -4.9 6.1
Financing 6.8 29.7 1.1 -2.0 -2.1 -3.6







EPS 4.69 3.69 3.68 2.67 2.24 1.67
NAS 0.38 0.35 0.32 0.29 0.28 0.25
Net D/E Net C Net C Net C Net C Net C Net C
Inari posts a good FY14Q1 results, boosted by contribution from newly-acquired Amertron and its own organic growth.
It is true that Inari's revenue will increase by 3x (from RM67.6mil to RM191.3mil QoQ) after Amertron acquisition, while net profit increases 60% QoQ from RM13.1mil to RM21mil. However, PBT margin reduces from 20% to 11.6% due to low margin from Amertron.
Out of the RM191.3mil revenue, Amertron contributes RM120.1mil. The rest of RM71.2mil that comes from Inari itself represents a slight improvement from RM67.6mil in the preceeding quarter.
Anyway, there is a RM4mil foreign exchange gain in the PBT because of stronger USD in this quarter. Without this special gain, Inari's PAT this quarter should be around RM17mil.
If based on Amertron's profit in FY12 before the acquisition, it will contribute around RM3mil net profit a quarter.

GENM 3Q2013 Press Release.pdf

SUMMARY OF KEY FINANCIAL INFORMATION
30/09/2013

 
INDIVIDUAL PERIOD
CUMULATIVE PERIOD
CURRENT YEAR QUARTER
PRECEDING YEAR
CORRESPONDING
QUARTER
CURRENT YEAR TO DATE
PRECEDING YEAR
CORRESPONDING
PERIOD
30/09/2013
30/09/2012
30/09/2013
30/09/2012
$$'000
$$'000
$$'000
$$'000
1Revenue
2,120,956
1,943,076
6,207,414
5,966,359
2Profit/(loss) before tax
365,647
281,215
1,328,443
1,298,259
3Profit/(loss) for the period
317,429
190,347
1,192,179
956,811
4Profit/(loss) attributable to ordinary equity holders of the parent
322,617
190,347
1,202,480
956,811
5Basic earnings/(loss) per share (Subunit)
5.69
3.36
21.20
16.89
6Proposed/Declared dividend per share (Subunit)
0.00
0.00
4.30
3.80


AS AT END OF CURRENT QUARTER
AS AT PRECEDING FINANCIAL YEAR END
7Net assets per share attributable to ordinary equity holders of the parent ($$)
2.5600
2.3200

November 25, 2013

Move to boost Insas shareholder return?

Insas Bhd’s board of directors is expected to meet today to outline plans to boost shareholder return.


The flagship public-listed company of tycoon Datuk Thong Kok Khee has been profitable for the past 10 years.

The last time Insas was in the red was in 2003, when it suffered a RM5.29 million loss. Despite 10 years of steady profit, investors had shied away from Insas.

Among the reasons cited were that the company was hoarding too much cash and its dividend payment was erratic.

“The board will try to address some of those issues. The board may also discuss a plan to float its subsidiary, the Melium Group, next year.

“The listing of Melium can easily be worth about RM600 million,” said a source, adding that this will further boost Insas’ war chest.

Melium, some 43 per cent-owned by Insas, has yearly sales of about RM150 million and is considered the country’s leading luxury fashion and lifestyle retailer with about 40 stores
nationwide.

It is the franchise holder for Dome Cafe, Etienne Aigner, Hugo Boss, Christian Lacroix, Cole Haan and Emilio Pucci.

Insas' non-independent director Datuk Wong Gian Kui told Business Times that floating Melium is a possibility but would not put a time frame to it.

Sources said with the planned Melium initial public offering, Insas is also looking at a firm dividend payout plan and a scrip exercise to facilitate the issuance of warrants and a share split.

Insas has about RM229.73 million in cash and total assets of about RM930 million.

"Changing the face of Insas is crucial. The company is doing well. Its first-quarter results, which will be announced this week, will show that Insas is now a different animal and belongs to the tier-one stage," claimed the source.

Insas is also the dominant shareholder of Inari Amerton Bhd and M&A Securities Sdn Bhd.

November 22, 2013

HLIND Q1 2014

SUMMARY OF KEY FINANCIAL INFORMATION
30/09/2013

 
INDIVIDUAL PERIOD
CUMULATIVE PERIOD
CURRENT YEAR QUARTER
PRECEDING YEAR
CORRESPONDING
QUARTER
CURRENT YEAR TO DATE
PRECEDING YEAR
CORRESPONDING
PERIOD
30/09/2013
30/09/2012
30/09/2013
30/09/2012
$$'000
$$'000
$$'000
$$'000
1Revenue
567,831
556,231
567,831
556,231
2Profit/(loss) before tax
58,135
44,645
58,135
44,645
3Profit/(loss) for the period
47,633
33,227
47,633
33,227
4Profit/(loss) attributable to ordinary equity holders of the parent
36,074
20,552
36,074
20,552
5Basic earnings/(loss) per share (Subunit)
11.70
6.67
11.70
6.67
6Proposed/Declared dividend per share (Subunit)
10.00
10.00
10.00
10.00


AS AT END OF CURRENT QUARTER
AS AT PRECEDING FINANCIAL YEAR END
7Net assets per share attributable to ordinary equity holders of the parent ($$)
3.9200
3.7900

November 21, 2013

YTL Q1 2014 Results

SUMMARY OF KEY FINANCIAL INFORMATION
30/09/2013

 
INDIVIDUAL PERIOD
CUMULATIVE PERIOD
CURRENT YEAR QUARTER
PRECEDING YEAR
CORRESPONDING
QUARTER
CURRENT YEAR TO DATE
PRECEDING YEAR
CORRESPONDING
PERIOD
30/09/2013
30/09/2012
30/09/2013
30/09/2012
$$'000
$$'000
$$'000
$$'000
1Revenue
5,210,748
5,072,130
5,210,748
5,072,130
2Profit/(loss) before tax
657,193
650,403
657,193
650,403
3Profit/(loss) for the period
594,893
534,131
594,893
534,131
4Profit/(loss) attributable to ordinary equity holders of the parent
427,562
391,930
427,562
391,930
5Basic earnings/(loss) per share (Subunit)
4.12
4.03
4.12
4.03
6Proposed/Declared dividend per share (Subunit)
1.50
1.00
1.50
1.00


AS AT END OF CURRENT QUARTER
AS AT PRECEDING FINANCIAL YEAR END
7Net assets per share attributable to ordinary equity holders of the parent ($$)
1.3600
1.2900
Definition of Subunit: In a currency system, there is usually a main unit (base) and subunit that is a fraction amount of the main unit.
Example for the subunit as follows:

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