Thursday, July 26, 2012

Should we follow smart money?

The KLCI retreated 11.18 points today. In spite of the weak market, CMSB advanced 9 sen to end the day at 2.91. Those who have been paying attention to this counter know that company-buy-back activity is the reason behind the rise. 
In today's transaction of 1,994,200 units, 939,900 were company-buy-backs.
Its prices ranged from 2.83 to 2.91 according to filings with Bursa.

Insiders know the company best. This is an indisputable fact. So, is something bullish going on in the company? Logically speaking, its looks likely. 

CMSB is a quiet stock with a strong balance sheet and good earnings. But because of its connection with someone whose image is not that good, the stock has been ignored. Will the insiders continue to push the stock higher? I don't think we have come to the end of the music yet. 

Friday, July 20, 2012

Kfima / FimaCorp

FimaCorp is 59.55% owned by Kfima. Both companies are doing well. The former is hardly traded while the latter is thinly traded. However, of late, both stocks are moving up well. FimaCorp is lasted trade at 6.50 and Kfima at 2.30. It seems that a merger between them is on the card. Don't miss the boat!

Sunday, July 08, 2012

ECSB has Present Values and Future Potentials

ECS ICT Berhad ( ECSB) has more cash in the bank than its paid-up capital. As at 31 Dec 2011, the company has RM66.577 million cash while is paid-up capital is only RM60 million. It has zero borrowings.

ECSB distributes ICT products of the most popular brands in the world through its 2500 resellers. It also provides value-added product support and technical services. 

Because of its small-cap and ill-liquidity, the stock is hardly covered by any analyst. Thus the majority of investors hardly pay any attention to it. To me, this stock is a rare gem. For the fiscal ended 31 Dec 11, it pays a single-tier dividend of 8 sen. At the last traded price of RM1.56, the dividend yield is 5.128.

With so much cash in the bank and a commendable first quarter result for this year, the stock is likely to improve its dividend payment. A bonus issue may also be in the offing. The stock certainly merits an upward rating.

ICT products are no longer luxury items. In fact, they are now necessities in life. The i-pad, for example, is now an educational toy for the very young to the very old. Children from as young as two years are using it. Old folks use it as a toy and a tool for business and pleasure as well. Needless to say, the i-phones and computers are just as important. 

For the reasons mentioned above, demands for ICT products are set to grow over the years. ECSB is certainly set to benefit from this trend. Hence, the stock is an excellent stock to buy and own at the present price of below RM1.60 per share.