market cap: 48.1 y (price: 6.01)
earning: 141 million
06 annual earning project: 141 + 141 * 1.2 = 310.2 million PE/G = 4810/310.2 = 15.5
cash and equivalent: 800m. actual PE = 4010/310.2 = 12.9
so it still a little under reasonable price range. Strategy: if it drops buy more.
Stocks are simple. All you do is buy shares in a great business for less than the business is intrinsically worth, with management of the highest integrity and ability. Then you own those shares forever. I will tell you how to become rich. Close the doors. Be fearful when others are greedy. Be greedy when others are fearful.
February 25, 2007
February 06, 2007
1068 YU RUN FOOD (A-)
Buying strategy: buy under $7.
actual PE for now:
if price = 7.2 and
06 profit = 5y (unlikely), actual PE = 16.4
06 profit = 6y, the actual PE = 13.6
06 profit = 7y, the actula PE = 12
Neff criteria: 55 + 0.005 / 22 = 2.54 < 2.6
(Earnings growth rate + Dividend %)/PE ratio
In the above formula, earnings growth refers to earnings estimated for the following year, expressed as percentage growth. Dividend yield is dividend expressed as a percentage of the stock price. Other things being equal, lower P/E ratio stocks will have higher value. Conversely, a higher P/E ratio stock may offer good value if it has a high earnings growth and dividend yield.
As a general rule, Neff tries to identify stocks that have a return ratio of two or more. If you don't find many stocks that fulfill this condition, you may use the formula to choose among the available ones.
Reasonable market cap = NCAV + 15 PE
06: 22y + 15 * (6y) = 112 y
07: 22y + 15 * (8.5 y) = 150 y
Financial position: very good
(Million)
Profit Equity ROE
06 estimate 600 2683 22%
06 interim 254 2383
05 345 2241 16%
04 160 655 25.8%
03 90 467 20.4%
02 52 233 23.5%
Durable profitability analysis:
06 Estimation: 254 + 306 = 600
07 840 (40% up)
08 1176 (40% up)
09 1200 (no up)