Public Bank Berhad

PBB
3.8.2010

At a price of 12.00, its ttm-PE was 15.32 and DY was 4.14

5 Yr Historical Data
EPS GR 14.7%
DPS GR -1.3%
PE range 11.6 to 16.1
DY range 6.0% to 4.3%

Its present ttm-PE is at the higher region of its historical PE range.
Its DY is at the lower end of its historical DY range.



Recent Stock Performance:

1 Week	0.0%		13 Weeks	2.4%
4 Weeks	1.3%		52 Weeks	21.0%

At present PE, there seems to be little room for PE expansion for PBB in the short term.  However, PBB has and hopefully, will continue to deliver on its EPS.

Latexx: Another GARP stock

Latexx
3.8.2010
Price 3.550
ttm-PE 11.05
DY 0.99

Historical 1 Year Data
EPS GR +++ High
PE range 7.7 to 12.4
DY range 1.3 to 0.8

5 Yr EPS GR Not Meaningful
5 Yr DPS GR Not Meaningful
This company turned profitable 2005-2006.

Its present PE is just above the mid-range of its this year's PE range.
Its DY is at the lower part of this year's DY range.



Recent Price Performance

1 Week	-1.1%		13 Weeks	3.2%
4 Weeks	-6.5%		52 Weeks	88.5%

Players in the Glove Sector
Adventa
ttm-PE 16.69 DY 2.36
Hartalega 
ttm-PE 13.87 DY 2.32
Kossan 
ttm-PE 15.06 DY 1.15
Riverstone (Singapore)
ttm-PE 11.13 DY 3.02
Rubberex 
ttm-PE 2.58 DY 2.88
Supermax
ttm-PE 17.74 DY 0.85
Topglove
ttm-PE 15.42 DY 1.73

How sustainable are the earnings in this sector going forward?

Dutch Lady

Dutch Lady
3.8.2010
Share Price 14.68
ttm-PE 12.96
DY 1.45%

5 Year Historical Data
EPS GR 28.8%
DPS GR 3.2%
PE Range 11.2 to 17.0
DY Range 7.0% to 4.6%

Its present PE is at the lower third of its historical PE range.
Its DY is at the low end of its historical DY range.



Recent Stock Performance

1 Week	-0.8%		13 Weeks	12.2%
4 Weeks	21.1%		52 Weeks	28.9%

Cyclical Versus Non-Cyclical Stocks

Charting a Cyclical vs. Non-Cyclical Company 
Below is a chart showing the performance of a highly cyclical company, the Ford Motor Co. (blue line), and a classic non-cyclical company, Florida Public Utilities Co. (red line). This chart clearly demonstrates how each company's share price reacts to downturns in the economy. 



Notice that the downturn in the economy from 2000 to 2002 drastically reduced Ford's share price, whereas the growth of Florida Public Utilities' share price hardly batted an eye at the slowdown. 


http://www.investopedia.com/articles/00/082800.asp

Know this chart and you will understand the challenge of investing into cyclical stocks.

Investors cannot control the cycles of the economy, but they can adjust their investing practices with its ebbs and flows. Adjusting to economic transitions requires an understanding of how industries are characterized by their relationship to the economy. It's important for you to know the fundamental difference between cyclical and non-cyclical companies so that you can distinguish between sectors that are affected by economic changes and those that are more immune. 

Petdag - a GARP investment

At the closing price of 9.90, PetDag was trading at ttm-PE of 13.06 and DY of 4.55%

Historical Data of last 5 Years
EPS GR 24.9%
DPS GR 38%
DY range 4.7% to 3.4%
PE range 9.4 to 12.9

At the present price, it is trading at
PE closer to the upper part of its historical PE range
DY closer to the upper part of its historical DY range



Recent Stock Performance:

1 Week	5.8%		13 Weeks	10.5%
4 Weeks	13.6%		52 Weeks	20.2%

Will the EPS of PetDag for this year be higher than the previous year?

Nestle Malaysia

Nestle
3.8.2010

Price 38.80
ttm-PE 23.32
DY 3.87%

Historical Data
Last 5 Years
EPS GR 9.8%
DPS GR 11.6%
PE Range 18.8 to 23.4
Average DY Range 5.1% to 4.1%

Its present PE is in the higher limit of its historical PE range.
The DY is at the lower side of its historical DY range.



Recent Stock Performance

1 Week	4.9%		13 Weeks	11.3%
4 Weeks	10.5%		52 Weeks	21.3%

Estimate the EPS for next year.
What will be the future PE of Nestle based on this estimated EPS?

Property stocks

http://www.btimes.com.my/Current_News/BTIMES/articles/proper02/Article/index_html

How to grow rich stealing super cash

How to grow rich stealing super cash
August 2, 2010

I propose a new push to educate industrious individuals looking at money-making opportunities in the $1.3 trillion Australian superannuation industry. I'm writing, of course, about organised criminals.

Given the rich range of opportunities available to rip-off superannuation money, I think it only fair the Australian Securities and Investments Commission provide a level playing field for the ne'er-do-wells by fully disclosing the loopholes.

Through a program of financial education, the commission can give these individuals what they want and indeed deserve from the current settings - a free ride with your superannuation cash.

As a handy guide for the commission, I propose any education program cover the following areas:

FINANCIAL SERVICES LICENCES

Criminal background? Dodgy past? Ownership of a financial services licensee is no problem.

How so? The commission does not apply a good-fame-and-character test to the owner of a company granted a financial services licence, but applies it to the directors.

BusinessDay exposed just such a situation this year when it reported on Jeffrey Revell-Reade who owned OzGroup, involved in managing super worth $600 million. Revell-Reade had been repeatedly named in relation to international penny stock scams.

All a person with a dubious past need do is own a company, appoint relatively clean-skin directors with some financial experience, and away you go - a financial services licence to play with.

Incidentally, even if the owner directly controls the financial services licensee, the commission doesn't say boo publicly. For example, companies controlled by a Hong Kong businessman Jack Flader, a central figure in the disappearance of $123 million in Trio Capital money, appointed two new directors to his financial planning business in June. The commission said this was not a problem.

PRODUCT DISCLOSURE STATEMENTS

If you are of a certain inclination you definitely do not want to tell investors exactly what you plan to do with their money.

Fortunately, the commission has, in my view, a track record of letting through misleading material that can be used to garner funds.

In the case of Trio Capital, the product disclosure statements for Astarra Strategic were revealed to be meaningless to the point of laughable.

In evidence to a liquidator's examination, the 24 years of investment experience referred to in Astarra Strategic's disclosure statement consisted of Shawn Richard, who described his qualifications as an office boy, and his less talented companion, Eugene Liu.

And away you go, harvesting $123 million in investments sent to an overseas company without another word.

Astarra is not an isolated case. I am aware of another product disclosure statement out there that does not name the investment manager.

Where is the money going? Who is placing it? The investor doesn't know. Neither does the commission. Pretty handy, hey?

CONFLICTS OF INTEREST

Fortunately for the criminally-minded, there are few legal obligations that effectively pick up conflicts of interest for those running superannuation funds.

Those patient enough can winkle their way into controlling all three elements within a superannuation fund: the administrator, the trustee and the investment manager.

In Trio Capital, all three became owned by the same enterprise, so the cash could be directed offshore without question.

Interestingly, large investment managers, such as AMP and Westpac, use exactly the same system.

Current practice means Bear Stearns could have set up in Australia in 2007 the You Beaut All You Can Eat CDO Superannuation Fund.

So this isn't just an education program for criminals; big corporations that act irresponsibly can get a leg up with this particular loophole.

FINANCIAL PLANNERS

Of course, your criminal enterprise needs a distribution network. And who better than a group of salespeople handsomely rewarded for selling your product?

Current settings allow all kinds of secret commissions to financial planning networks.

With Trio Capital, an $840,000 secret commission was paid by the investment manager to the Wollongong financial planner Tarrants that it happily called a "marketing allowance". These kinds of payments are due to be banned under the Bowen reforms. Fortunately for crims, there are still opportunities to use financial planners for their own ends. This rests in the ease with which planners and entire businesses can become "authorised representatives" of a financial services licensee.

The commission has no say about these "authorised representatives".

It does not check their credentials in any way. Instead it relies on financial services licensees to check the competence and integrity of their authorised reps.

Ahem. See point one.

BREAK THE LAW

Put a bit of spit and polish on the curriculum vitae. Even tell a few lies in your Australian Financial Services Licence application; the commission doesn't appear to look too hard.

And there you have it. Put in place the above steps and grab the money.

There is a lot of superannuation money. It has attracted a lot of interest of the wrong sort.

By rights the commission should be acting to fix these problems.

But until that time, the crims are free to use all the pointers outlined above.

In fact, they already have.

Source: The Sydney Morning Herald

http://www.brisbanetimes.com.au/business/how-to-grow-rich-stealing-super-cash-20100801-111ir.html

Venture Investing

The magic venture investing formula is simple: Invest in young, good, innovative, and growing companies while they are cheap.

But what is "good", and what is "cheap"?

7 Contrarian Principles – Ignoring Convention

Do not follow the crowd. Ignore the market, the crowd, and its fashions... More

Identifying an Outstanding Company: Buffett's Criteria2

Buffett's Three Non-financial Investment Criteria It is simple and understandable. It has a consistent operating history. It has favorable long-term prospects. Buffett's Four Financial Investment Criteria Return of equity (not earning per share) "Owner earning" (the share of profits that belongs to investors). Profit margins (which must be high) Return on reinvested profits (which must create at least $1 of market value for every dollar invested)

Six Questions for Measuring the Potential Investment

How long will it take for profits to pay back the investment? When will the cash stop flowing out and start returning? Do we really have to make this investment? What is the return on investment? Is that return comfortably above the true cost of the capital invested? Looking ahead, and allowing for interest rates, what is the future pay-off worth in today's values?

A to Z of Venture Investing

A-F: Opportunity Introduction Do most inventors approaching you lack business skills? If you don't want to miss a great investment opportunity but have no time to teach them the A,B,C, etc. of venture financing, just advise them to go thoroughly the steps of the Ten3 e-Coach on "Venture Financing". This will make your  communication with first-time entrepreneurs much more enjoyable and effective. Please send us e-mail if you wish to become an associate of the Ten3 e-Coach on Venture Financing and receive well prepared investment proposals from our graduates who will match with your investment selection criteria. G-M: Initial Screening Define criteria and follow procedures for evaluating business plan andmanagement team N-T: Due Diligence Investigate and evaluate the investment opportunity by conducting due diligence research: qualify risks, analyze and verify factors presented in the investment proposal U-Z: Negotiating and Closing the Deal Valuate the venture, structure the deal, draft and sign an investment agreement

http://www.1000ventures.com/venture_financing/venture%20investing_main.html

Growth At Reasonable Price (GARP) at Work

Let's delve into some of the numbers that GARPers look for in potential companies.

The PEG Ratio
The PEG ratio may very well be the most important metric to any GARP investor, as it basically gauges the balance between a stock's growth potential and its value.

GARP investors require a PEG no higher than 1 and, in most cases, closer to 0.5. A PEG less then 1 implies that, at present, the stock's price is lower than it should be given its earnings growth. To the GARP investor, a PEG below 1 indicates that a stock is undervalued and warrants further analysis.

PEG at Work
Say the TSJ Sports Conglomerate, a fictional company, is trading at 19 times earnings (P/E = 19) and has earnings growing at 30%. From this you can calculate that the TSJ has a PEG of 0.63 (19/30=0.63), which is pretty good by GARP standards.

Now let's compare the TSJ to Cory's Tequila Co. (CTC), which is trading at 11 times earnings (P/E = 11) and has earnings growth of 20%. Its PEG equals 0.55. The GARPer's interest would be aroused by the TSJ, but Cory's Tequila Co. would look even more attractive. Although it has slower growth compared to TSJ, CTC currently has a better price given the growth potential it offers. In other words, CTC has slower growth, but TSJ's faster growth is more overpriced. As you can see, the GARP investor seeks solid growth, but also demands that this growth be valued at a reasonable price. Hey, the name does make sense!



GARP at Work
Because a GARP strategy employs principles from both value and growth investing, the returns that GARPers see during certain market phases are often different than the returns strictly value or growth investors would see at those times. For instance, in a raging bull market the returns from a growth strategy are often unbeatable: in the Internet boom of the mid- to late-1990s, for example, neither the value investor nor the GARPer could compete. However, when the market does turn, a GARPer is less likely to suffer than the growth investor.(see charts below)

Therefore, the GARP strategy not only fuses growth and value stock-picking criteria, but also experiences a combination of their types of returns : a value investor will do better in bearish conditions; a growth investor will do exceptionally well in a raging bull market; and a GARPer will be rewarded with more consistent and predictable returns.

Conclusion
GARP might sound like the perfect strategy, but combining growth and value investing isn't as easy as it sounds. If you don't master both strategies, you could find yourself buying mediocre rather than good GARP stocks. But as many great investors such as Peter Lynch himself have proven, the returns are definitely worth the time it takes to learn the GARP techniques.


http://www.disnat.com/en/knowledge/stock_selection/stock_selection5.asp











What Is GARP?
The GARP strategy is a combination of both value and growth investing: it looks for companies that are somewhat undervalued and have solid sustainable growth potential. The criteria which GARPers look for in a company fall right in between those sought by the value and growth investors. Above is a diagram illustrating how the GARP-preferred levels of price and growth compare to the levels sought by value and growth investors:

Profiting from the economic cycle using the Investment Clock

Forecasting future asset class returns are, needless to say, challenging. To do so effectively requires, among other things, a clear picture of your starting point. Where are we in the cycle ? What is the timing for increased inflation? To generate profits for clients one must be able to model in real time when the world economy moves from one phase in the cycle to another.

The Investment Clock approach recognises different points within the economic cycle and differentiates between phases which are likely to generate growth and inflation readings based on past trends and the current momentum of lead indicators. These indicators are updated on a monthly basis to build an expectation of how the global economy may perform over the coming three to six months.

The growth reading sets the relative weighting of cyclical and defensive assets (North-South on the clock diagram). The inflation reading sets the weighting of financial assets versus real assets (East-West).

Time lags in the release of economic data mean it reflects what has already happened in the economy. However, to profit we need to recognise in real time when the world economy moves from one Investment Clock phase to another. Therefore, we need a “now-cast” of each possible economic growth and inflation outcome, growth and inflation being the two key mPublish Posteasures of economic activity. To build this now-cast, we consider an array of trend indicators, leading indicators and price signals from the markets themselves. This now-cast drives fund positioning on a real time basis.

With the benefit of hindsight we can identify the historic phases of the US economic cycle by taking note of the major peaks and troughs in the growth and inflation cycles.

Based on back testing, some asset classes perform better than others in each phase: the Investment Clock links the phases of the economic cycles to the performance of the asset classes:



The Investment Clock below shows the four key stages of an economic cycle:

• Stagflation (like we saw in mid-2008). A difficult time for most markets where growth has moved below trend but inflation concerns are high. As the Clock shows, we believe this is a period where Cash can outperform most other investments.

• Reflation (July 2008-March 2009). Often characterised by a period of interest rate cuts, we believe this is often a period of the cycle when bonds can perform well.

• Recovery (such as that which has been experienced through the summer of 2009). Often follows a period of reflation and can represent the best conditions for stocks to perform well; improving growth with falling inflation.

• Overheat (where we believe we were headed in Q4 2009 and into Q1 2010). Typically when commodities tend to shine through as the prospect of inflation rises are coupled with growth above trend.




http://www.fidelityinstitutional.com/deadly_win/multiasset.html

Safety Net for "Everyone"

http://www.newlaborforum.org/Home/Spring2010/Spring2010Abstracts/tabid/1700/Default.aspx

The current hard times have been harder on some people than on others, harder on the poor-obviously-than on the rich; but harder also on blacks and Hispanics than on whites. As of this writing, the unemployment rate for blacks is at 15.6 percent, and for Hispanics it’s at 12.7 percent. For white people, it’s 9.3 percent. Of course, the vast majority of the unemployed are white.

The Zero-Sum Games of Capitalism

http://neuropolitics.org/defaultapr09.asp





http://www.schoolofthinking.org/what-is-your-dangerous-idea/tit-is-coming-the-shadow-of-the-future/

Strong Performance at DBS, Singapore Bank stocks in focus

July 30: Bank stocks in focus next week

WRITTEN BY GOOLA WARDEN
SATURDAY, 31 JULY 2010 11:21

DBS GROUP HOLDINGSS has been hit by another impairment charge related to its controversial purchase of Hong Kong’s Dao Heng Bank nine years ago. Singapore’s largest bank said today that it made a goodwill impairment charge of $1.02 billion in 2Q10, resulting in a net loss of $300 million for the quarter.

DBS bought Dao Heng in 2001 for more than $10 billion, or three times book value. Under accounting rules at the time, the goodwill of $6.8 billion was to have been amortised over 20 years. The rules changed in 2005, however, and DBS is now required to carry Dao Heng in its books at “fair value”. DBS made an impairment charge of $1.13 billion related to Dao Heng in 4Q05. Dao Heng, which has since been renamed DBS Hong Kong, was carried in the group’s books at $8.43 billion as at June 30. That values Dao Heng at 2.2 times book value. By comparison, shares in Bank of China are trading at about 2.1 times book value, while Hang Seng Bank is trading at about 3.5 times book value.

On the operational front, however, DBS turned in a solid performance in 2Q10. Its loan book expanded 8.9% q-o-q, and 18.1% y-o-y. That drove DBS’ market share of Singapore dollar loans up by almost one percentage point, from 21.5% to 22.4%. Excluding the goodwill impairment charge, DBS chalked up earnings of $718 million. That was a record for the banking group, and some 20% higher than the most bullish analyst estimates. “It was above our expectations and consensus, led by another strong trading quarter,” notes Kenneth Ng, an analyst at CIMB Securities.

Piyush Gupta, CEO of DBS, warns that the group’s operational performance in 2H10 might not be as strong. “We don’t expect double digit [loan growth] for the second half,” he says. Also, net interest margins have been under pressure, declining by nine basis points in 2Q10 to 1.84%. Gupta says that “NIMs could see two to three basis points compression” in the second half.

Looking ahead, Gupta says DBS is trying to rebalance its footprint across the region, aiming for 40% of its earnings to come from Singapore; 30% from Hong Kong and China; and the remaining 30% from South and Southeast Asia. Currently, Singapore contributes 62%, Hong Kong 22%, India 8%-9%, China 2%-3% and the balance spread across other markets.

WATCHING THE BANKS
In the wake of the strong performance at DBS, bank stocks could be in focus in the coming week. “We wonder if UOB and OCBC could surprise with stronger-than-expected trading figures,” Ng says. “Our 2Q10 forecasts for UOB and OCBC stand at $582 million and $607 million respectively.” Oversea-Chinese Banking Corp will be reporting 2Q10 results on Monday, while United Overseas Bank is scheduled to report the week after on Aug 10. CIMB currently has “outperform” ratings for both OCBC and UOB with target prices of $10.79 and $23.32 respectively.

As for DBS, some analysts are turning more positive now. For one thing, it has a decent dividend yield. For 2Q10, the bank declared a dividend of 14 cents per share, bringing its total dividend for 1H10 to 28 cents. That translates to an annualised yield of 3.9% at the last done price of $14.40. Investors who opt for scrip dividend will receive their shares at a 5% discount. Shares in DBS are trading at 1.3 times its book value of $10.88 per share.

Jonathan Koh, an analyst at UOB Kay Hian, says that loan growth at DBS has been strong and broad based. He currently has a “buy” recommendation on the stock. Ng of CIMB, however, still has an “underweight” rating on the counter. Meanwhile, DMG & Partners says that DBS’ 2Q10 results were way above expectations, and that it is reviewing its “neutral” rating.

CHART VIEW
The STI (2,987) fell nine points on Friday, after testing an intra-day high of 3,018. As a result a dark cloud cover formed on the candlestick chart suggesting that the index is likely to continue lower in the coming week. While major support is at 2,900, the near term retreat should find support at 2,957. The trend remains upwards but resistance at 3,000 is formidable.

http://www.theedgesingapore.com/blog-heads/goola-warden/18534-weekends-comment-july-30-bank-stocks-in-focus-next-week.html

Warren Buffett: History of Assets owned by Berkshire Hathaway and its investments

http://blog.moneydesktop.com/warren-buffets-investment-history/

The Top 10 Most Profitable Public Companies in the World

Top 10 Profitable Companies in China

http://www.chinadaily.com.cn/business/2009annualreports/index.html