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.

October 22, 2008

中国移动-5年目标价200, Templaton Way

中国移动半年业绩548.49,前三季826,全年估计可达1096, 现价市值61 * 200.45亿则EPS=5.46 RMB/6.17 HKD, PE=10倍


09,10,11 年盈利估计可保持25%增长,则11年盈利EPS=12元,假设仍然是熊市,股价应该可以达120,假设已经恢复牛市,PE/G=1,给予20倍PE则可达240元, 如果12年给予20倍PE则可达288元.现价63买入可增值4.5倍.


Templeton estimates its EPS could reach 12.77 at year 2013 (about ten years after 2004, EPS at 2004-2008: 2, 2.6, 3.31, 4.658, 6.17)


本集團營運收入持續增長達到人民幣1,964.60億元,比上年同期增長17.9%;盈利能力進一步顯著提升,股東應佔利潤達到人民幣548.49億元,受到中國內地企業所得稅稅率調整等因素的正面影響,比上年同期增長44.7%,股東應佔利潤率達到27.9%的較高水平;EBITDA達到人民幣1,043.61 億元,比上年同期增長16.2%;每股基本盈利達到人民幣2.74 元,比上年同期增長44.2%。本集團的增值業務收入延續良好增長勢頭, 達到人民幣529.96 億元, 比上年同期增長26.4%,佔總營運收入比例達到27.0%,比上年全年提升了1.3個百分點。目前本集團資本結構穩健,雄厚的財務實力為未來持續發展奠定穩固基礎。

. 營運收入達到人民幣3,013.96億元,比上年同期增長16.6%
. EBITDA 為人民幣1,591.97億元,比上年同期增長14.3%
. 股東應佔利潤為人民幣825.90億元,比上年同期增長37.9%

except from <<The templaton way>>

China mobile, is a cellular telecommunication company. The company currently leads the Chinese market, having captured nearly 68% of its customer base. Although China mobile costs a good deal more than it did back to 2004, it still provides a good historical example of some of Uncle John's preferred criteria in a stock. This stock also trades as an ADR on the NYSE. First, the stock has a relatively low P/E ratio of 11X, More important, the P/E ratio looked even better when coupled with the long-term estimated growth rate in earning per share of approximately 20 percent. Taking this a step further, the P/E divided by the estimated long-term growth rate for earnings per share (PEG) OF 0.55 (11/estimated growth rate 0.55) made it one of the lowest-priced stocks in the world in the wireless tele industry. In other words, this stock was among the cheapest in the world compared with the remaining list of global wireless tele companies.

China Mobile 2004 PEG=0.55
World wide wireless tele 2004 group average PEG ratio = 0.84. perhaps most important to uncle john was the company's strong growth rate and high earning power on a comparative basis. when john invested in china mobile, he said that over the next 5 years it would be increasingly important to be invested in a list of world wide stocks that had the widest profit margins and the most rapidly increasing profits. He went on to say that now more than ever, it is beneficial to have a long-erm view in stock selection. In the past, he had advocated calculating a P/E that was based on the estimation of EPS five years into the future. In later 2004, however, he strongly suggested taking his estimation of future earning even further into thefuture to calculate a P/E ratio based on EPS in year 10, OR 2015. This of course would seem like never-never land to analysts who spin their wheels estimating EPS for the coming quarter. Thus, in this case, rather than targeting a P/E of 5x or less for EPS in year 5, the analyst should target a P/E of around 2x or less for EPS in year 10. If we take the same set of assumptions that we applied to china mobile in 2004 (PE based on the current year's EPS of 11x and the assumption of a long-term growth rate in EPS of 20%), we arrive at a calculated P/E ratio of 1.8x year 10 EPS (current price in 2004 divided by estimated EPS in year 10). Looking at a stock with this long-term perspective is challenging, but the results can be rewarding. (see graph). Uncle John was the first to admit that the taks of estimating what a company's EPS will be 10 years into the future is very difficult. If one places a heavy emphasis on the companies with the best growth and strongest earning power, it is easy to see where this exerciese directs a bargain hunter. As in attempting to calculate the EPS of a company five years into the future, the bargain hunter is forced to take a long-term perspective on the company. Not even a minute should be wasted thinking about something like the next quarter's EPS. Instead, Uncle John's advice to forecast EPS 10 years down the road provides a strong warning about the growthing thread of bulding surpluses in the economy and the resulting future competition that excess capacities will impose on profit margins and earnings.
Therefore, by focusing on the future prospects of a company as much as 10 years into the future, a bargain hunter has to think about thecompetitive positioning of a company in the market. In short, bargain hunters must devote a large majority of their efforts to determining the competitive advantage of a business in relation to its competitors. This requires putting a great deal of effort into studying not only the company whose stock you are considering for purchase but also the company's competitors in the market.

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