Setting my sights on US Market

Currently, I am looking at some companies listed in the US market. Will update once I had purchased them :). I might also add some more S Shares depending on how low the market will go.

Bought Ezra and portfoilo update

Bought Ezra @2.7 on 10 June 2008.

Boring Portfoilo as of 13 June 2008
Asia Enterprises
Courage Marine
C&G
China Sky
Ezra

Overall, Boring Portfolio had dropped 10.4% as of to-date as compared to STI which had dropped 13.95% since Jan 2008. (Jan Opening 3462.69, 13 Jun Closing 2979.56)

Quotes from the Intelligent Investor - Benjamin Graham

"In the depths of a depressed or bear market, the average person can see no ray of light ahead and can think only in terms of worse to come. So too , when an individual company or industry begins to lose ground in the economy, Wall Street is quick to assume that its future is entirely hopeless and it should be avoided at any price. The two types of reasoning are similar and equally fallacious."

"Timing is one great psychological importance to the speculator because he wants to make his profit in a hurry. The idea of waiting a year before his stock moves up is repugnant to him. But a waiting period, as such, is no consequence to the investor. He enjoys an advantage only if by waiting he succeeds in buying later at a sufficiently lower price to offset his loss of dividend income.Timing is of no real value to the investor unless it coincides with pricing that is, unless it enables him to repurchase his shares at substantially under his previous selling price."

When a stock goes down should you sell?

Should you or should you not? The answer is depends.

Depending on your risk appetite, time horizon and amount of $ in your bank account. If you those who cannot sleep over your investment, I suggest you sell them. After all, no money can buy health and mental health. No point becoming a lunatic over some investment.

You might ask what should I invest in then since I still need to build my retirement nest. My suggestion to you is to buy Index Fund. Not just SGX but the world indices around. Point of Entry is important in this case. You want to buy them when the price is reasonable, not on the high hoping that it would go higher.

As for those who choose to remain invested in equities, ask yourself the following.

1. Is the decline of price due to any change in the fundamental of the Co?
2. Is the co reporting any decline in profit or losses?
   

If the answer is no, it is Mr Market feeling depressed and offering you a lower price. You should just ignore him if you have done your homework. This is why it is important to make note to yourself the reason why you invested in the co in the first place. Do not fall in love with your co if it is performing badly , sell it. It is better to cut loss and look for better opportunities with your losers. Time is your friend and your enemy as well if you do not know how to use it well.

Courage Marine

Listed on SGX on 13 October 2005 with an IPO price of $0.220. Courage Marine closes it books on 31 Dec annually.As of 31 December 2007, Courage Marine's assets is held by 96% Equities and 4% Liabilities with no long term debt. The Fleet consists of 5 Handysize and 3 Panamax dry bulk carriers, with total tonnage of approximately 379,675 dwt.

Let take a look at what it matters most for any company, the earnings

Year EPS (USD)
----- ------
2003 0.007
2004 0.032
2005 0.030
2006 0.026
2007 0.057

As we can see since inception, the earning had dropped 0.004 cents per share or 13.3% in 2006 before rising 0.031 cents per share or 119% to 0.057 cents per share.

What I like best about this Company is their margin.

Year Margin (%)
----- ------
2003 33.62
2004 55.57
2005 54.40
2006 49.05
2007 66.78

As we can see, Courage Marine commands a sizeable margin and I typically like company with high margin, it shows that they are able to control their pricing.

Let take a look at the ROE next

Year ROE (%)
----- ------
2003 NA
2004 184.88
2005 41.51
2006 38.48
2007 52.16

I will ignore the figures in 2003 and 2004 and maybe even 2005 since the Company was only listed in October 2005. Why? By the time, the Company was listed. All it left was just 2 months before the Company closed it books on 31 December 2005. Way above, the 15% ROE criteria i have.

Bought today

Putting my money where my short list are. I bought the following

Courage Marine @ 0.42
China Sky @ 1.05
C&G @0.29
Asia Enterprises @0.415

I had investigated their annual reports. These businesses are funded adequately through their operation activities. Have very low gearing, high quick ratio.

Final Shortlist

China Sky - Buy Price $1.05 , Target Price $1.59
Courage Marine - Buy Price $0.425, Target Price $0.76
C&G Industrial - Buy Price $0.29, Target Price $0.74
Asia Enterprises - Buy Price $0.42 , Target Price $0.71

Watch List

Company	Price Now	Target Price
KS Energy	2.010	3.07
Ezra	2.680	3.55
China Sky Chemical	1.100	1.60
Celestial	0.875	1.28
C&G Industrial	0.300	0.68
Courage Marine	0.425	0.77
China Sun Bio-Chem	0.315	0.65
Asia Enterprises	0.405	0.71

I would be tracking the stocks listed above.

Sold Celestial Nutrifood yesterday

Was too tired to update but I sold 2000 shares of Celestial Nutrifood @0.765

Bought 2000 shares of Celestial Nutrifood

Bought 2000 shares of Celestial Nutrifood today at 0.725 at a total cost of $1450 without commission added yet.

Stockpick List May 2008

Company PE Ratio Market Cap ($M) Target Price % to Target Price Ho Bee 2.79 744.37 3.7 72.2 Ecowise 3.5 18.26 0.6 65.0 C&G 4.26 108.2 0.7 54.3 Asia Enterprises 5.88 114.7 0.7 40.0 Celestial 5.8 486.54 1.2 36.7 Pacific Andes 6.18 357.75 0.8 32.5 Fung Choi 5.84 148.4 0.5 32.0

Sold off Celestial Nutrifood

Sold off 3000 shares of Celestial Nutrifood at XD for 0.715.

Sold off Pacific Andes

Sold off 4000 shares of Pacific Andes @0.52 . Just took a profit as I await to see if the Peru aquistion could be better re-finance at a fixed charge.

Fishing time

Portfolio Summary

Today's Change s$130.00 (-3.1%)

Total Value s$4,035.00

Total Change s$63.00 (1.6%)

Portfolio still in the black with 1.6% increase from date of investment. Charges for buying and selling had been included in before the abovementioned figure.

Warren Buffett just sinked in 23 Billion in a Wrigley deal. Yeah, support from the Guru in terms of Market bottoming down. Given his style, it is unlikely he will take 23billion to throw it away. Showed that it is really a good time to buy selective company now.

Portfoilo update

Today saw a general rise in most stocks over Asia Markets

Celestial Nutrifood closed at 0.73 (+0.09 from purchase price of 0.64)

Pacific Andes closed at 0.50 (+0.015 from purchase price of 0.485)

Gitch today. Sign from Heaven?

This morning, I tried unsuccessfully to buy C&G Industrial, Fibrechem and KS Energy as my brokerage was having a problem. The brokerage had just updated to a new platform and could not cope with the volume and the system crashed. In hindsight, I wonder if it was a bane or boon.

C&G closed flat today at 0.28

Fibrechem went up to to 0.74 from my intended entry price of 0.73.

KS Energy went up to 1.70 from my intended entry price of 1.68.

Boring stocks bought today

My investment philosophy is to identify company that are undervalued to its intrinsic value. As I am not Warren Buffet, I have a huge margin of safety of 50% as my safety net. Secondly, I look at growing ROE of about 15% and above (as it indicated Management ability to grow retained earning) and consistent EPS (Even better if it is growing). Business must be able to be self funded through its operating activities and not borrow excessively. Lastly, profit margin must be 10% and above.

I intend to use this blog to track my investment portfolio.

Celestial Nutrifood deal with soya bean and Pacific Andes deal with fish. Both are trading at PE ratio of 5+ as compared to their respective industry PE ratio of 20+. I believe both are undervalued to their intrinsic value. This represent a excellent chance to buy in given that the equity market had been battered due to the sub-prime market. I believe the US will clear up their mess by 2009 and all losses would be factored in.

Company	Date Bought	Shares	Price Bought
Pacific Andes	18-Apr-08	4000	0.485
Celestial Nutrifood	18-Apr-08	3000	0.64