The Accidental Blogger

The Accidental Blogger

For the past ten days, my mind was actually blank of what to write or comment or share any views for my coming blog. There were so many happenings events going on yet I could not pick one up, does a bit of studies and research and bingo! Write a blog about it from my angle or point of view.

I think this is a common problem for many amateur bloggers because there are no definite dateline or pressure to finish an article and have it posted online or published in the newspapers.

I did noticed that many regular stocks bloggers suddenly disappeared from the scene at times and left us wondering what has happened to them.

Perhaps the motivation was not there or the ideas could not be conceived into an interesting story. Strangely, I have been rather lucky to be able to come out with at least two blogs per month since the inception of Kassim's Thoughts first maiden blog on July 21, 2013 entitled : One Good "Seng" Of Bursa Malaysia.

I did not initially wanted to start out like this. If some of you might remember, prior to this, I was "promoting" certain stocks with few  interesting sentences on the famous website : Stocksunleashed's chit chat column. At that time, I was using the name Kassim.

But then after some times, I was shocked when someone else started to promote their stocks using my Kassim name as well! I did not know whether to feel flattered or not at that time. It irked me actually that I posted back with some not very pleasant to hear comment.

It also prompted me to rethink if there is another way someone else would no longer be able to use my name to post comment. This thought conceived eventually into a blogspot name Kassim's Thoughts.

So in a way, I should also be grateful to those who used my names to promote their stocks. If not for them, most probably, I would not have realised I actually posses  a simple flair of writing and with some good points to share too.

In a nutshell, we can safely say I am the accidental blogger! I do hope to be able to continue to share useful comments and thoughts for the next few years. Matter of fact is if the Retirement Aged has not been revised to 60, I would be retiring in 10 months time!

Yes, this give you readers an ideas how "young" I am! So actually I am in a sweet pot to determine if I wish to continue working to the "maximum" times of four years plus or not.

I have several friends in their early 50s who had taken early retirement package compensation from their companies. They advised me to continue working unless there are tremendous working pressure in my work which will cause me to have health problems.

It is a blessing that my work is rather a relaxing one where I can plan to go for either 9am or 11am shift. Of course I need to go off later if I plan to go for the later shift. Apart from these shift, there are at times plenty of free time to do your sendirian berhad work when there is not work for long periods of time.

I think I should skip this boring part or else most of  you are likely not to read further unless I can "stoke" your interest up again with at least a topic on a certain stock. After all, if not for stock market and shares topics, I bet none of you would be wasting your precious time to open up your smart phone/computer/lab top to read the thoughts of an old man!

Something must be brewing at Tek Seng

As the stock market continues to drift lower and lower by the days recently, one stock has been trending on the opposite direction by the days too.

It is Tek Seng Holding Berhad, a stock I have been commenting numerous times that readers might think I am biased when it comes to stocks with the names "Seng".

Hup Seng Industries Berhad, Keck Seng (M) Berhad and Tek Seng Holdings Berhad are three stocks that have been regularly gracing my blogs from time to time. Incidentally, I have at one time or another owned shares in these three companies.

So during the last two days saw heavy volume accompanied by the rising share price of Tek Seng. It share price touched an all time high of RM1.33 on May, 10, 2016.

Are the chasing pack of investors know something is brewing at Tek Seng

or they sensed that Tek Seng is going to announce an even better 1st Quarter Result? And hence they are buying in heavy volume ahead anticipating the good results will spearhead the share price to rise even further?

Based on my investing instinct, it is the latter which investors/speculators are banking on. A friend on mine with connections in this solar cell business told me that supply had not been able to match demand for several months already.

Whether he is telling the truth or not, when Tek Seng announces its 1st Quarter result (which I believe is anytime now), the earnings will determine  his words. At the moment, I believe in my friend because I have known him for several years playing football together and I know he is the type of person to be trusted.

It has been a great wonderful rewarding experience for yours truly with my initial investment in Tek Seng since 2008. I have been rewarded with several thousands of dividends plus another 7,500 free shares of warrant which traded at RM1.05 on May 11, 2016.

If I am to dispose of my warrants, the entire proceeds is more than enough to cover my initial investment with spare cash as well. As such, my current 15,000 shares of its mother share, Tek Seng are also considered free!

Believe it or not, I seem to be lucky when it comes to "Seng" investment in Bursa Malaysia. Perhaps it is times I should look into other shares with "Seng" names too. Ha ha.

Building Up A Basket of Defensive Stocks

Building Up

A Basket of

Defensive Stocks

From time to time, there would be some friends / followers keen to know  my next target stock to buy. I am actually used to such question that I have decided to come up with a standard reply: The moment I BOUGHT any stock, I will post in  our WhatsApp Group so that members are informed and will make their own decisions.

Although I share with my stocks purchase, I sincerely believe not all my stocks purchased will be followed by all. Meaning NOT all will simply go and buy. Many of my followers / friends are seasoned investors, too and they  do have knowledge and good judgement on stocks too.

A few of them are very well versed with certain stocks which I am not. But nevertheless, the WhatsApp Group is a very good platform for amongst us to share our views and at times certain jokes as well.

Anyway, where is the stock market direction heading this year? Which theme are investors looking at? Stocks that are set to gain from the strengthening of the Ringgit? What about plantations stocks? One kind famous blogger Calvin has been fiercely promoting plantation stocks in view of less production this year due to the El Nino effect. At the moment, his call seems to be on the right track as futures prices are trading higher this year for plantation.

What about those related to oil and gas? Oil seems to be hovering around USD 40 plus minus range? Some days you will read oil prices moving up and another day there will be a report of something happening and oil prices move down.

If an investor is to take all those above facts into consideration before investing, I think it will be very difficult because situations can change very fast. Though the USD appeared to be not so strong vs the Ringgit, but  I bet many are not willing to bet that the Ringgit will trade back to its RM3.30 levels. The best it can trade is RM3.80 levels, that is also my personal opinion.

Although I do understand all those facts will have an effect on stocks, I do not want it to seriously effect my stocks selection. I will take a different approach that is not so mind-blogging.

I will use the dollar-cost averaging methods this year. I will try to buy a certain stock (which hit my target price to purchase) every one month plus or so.

In short, I intend to buy a basket of quality stocks (in my opinion only) that if one holds over a period of between now and three years, one has a better chance to reap its rewards when the share price moves up eventually due to consistent improving profits.

Some of my criterias are :  the companies are paying good dividends regularly, having good cash-flow in their business, are cash-rich and focussing on their main business rather than trying to diversify into totally different kind of other business they do not know or not very familiar with.

Readers would have noticed that I have been on a buying spree since the end of 2015. I had bought NTPM, CCB, Chin Well and the latest BP Plastics, but periodically so that as to average out.

At the moment, NTPM is positive, CCB and Chin Well are more or less same, while BP Plastics is on the negative side. Am I worried now that one of my stock selections is in the negative area?

No, I am not perturbed at all about the share price moving down after my purchase. I don't really see the short term price movement as bothering at all. What I am really worried is the quarterly results.

Results are all that matter for any stocks. A good string of sequential quarterly results can move a stock price up by some percentage. But it does not guarantee it will not come down should overall market sentiment takes a severe beating due to certain crisis.

Still, a better quarterly result is so much better than a poorer quarterly result. Even then, as I experienced recently three of my stocks were actually traded down at certain stage after announcing good quarterly results. (You can refer to my previous blog : When good results are still not good enough).

I still believe if one takes a longer term horizontal view of three years holding on to such stocks (which has the criteria as mentioned), one will reap rewards.

Two such stocks which fit into my criterias bought and were sold off after a few years later for good bumper profits were Hup Seng Industries Berhad and YSP Sah. These are two classic examples.

I will be looking to buy another stock in due time. But the stock which is in my radar must more or less hit my target price. But it is not so appropriate if I were to tell readers the list of my target stocks and then I did not purchase them later if they fall into my target price.

This also helps to explain to my reader CK who asked me for which stocks I am aiming to buy. So to you, CK, I hope my views and comment shared will help explain more precisely why I did not wish to name any stocks I have not yet bought but are in my radar list.

I have always believed actions speak louder than words.

[Also from now onwards, I have decided not to post any buying and selling contract note of my latest shares. I believed it is not really necessary because if I buy, then I really buy because I can't cheat everyone by saying I buy when I actually didn't buy or vice-versa). The truth can always be unearthed in the end). As they say, you can cheat or tell lie once and get away, but eventually you will get caught if you keep doing so].

  

When good results are still not good enough

When good results

are still not good enough

The stock market continues to intrigue me more and more these days. Although I have been trading since 1993, I have not been able to understand very well the intriguing movements of the market from time to time.

The latest several incidents are fine examples. It is the nature of investors to be looking forward when your stock is going to announce a quarterly result. You pray it will be a good one so that more investors will be more keen to buy the shares and hence reduce the supply in the market. In the process, the more demand vs less supply situation will help to push up the price.

Well, that is what I thought so until three of my stocks posted good quarterly results, but the share price either shot up temporarily and then came down worse later or tanked in just like that the very next  trading day.

The first one is Tek Seng Holdings Berhad. Prior to announcing its 4th Qtr  2015 results on Feb 15, 2016, its share price touched as high as RM1.30 on Jan 11. But on Feb 15, it announced a sterling results of 4.02 eps for 4th Qtr 2015. It is by far the highest eps per quarter since the last decade.

In fact, its total culminated nine months earnings of 2015 is just 4.4 sen when compared to its 4th Qtr earning of 4.02 sen alone. Is the solar business finally bringing in the revenue and hence rising profits now?

But the next trading day saw Tek Seng closing at RM1.19, up just 7 sen. Why didn't it surpass its peak price of RM1.30 done on Jan 11? Shouldn't it be at least traded near that peak price of RM1.30?

Worse, if you care to look at today's closing price, April 14, it is just RM1.10 which is below the post 4th Qtr result day.

The second one is Cycle and Carriage Bintang Berhad. Prior to announcing its 4th Qtr 2015 results, its share price touched a high of RM3.93 on Jan 11, 2015. When it announced its 4th Qtr results on Feb 22 an 10.12 eps (thus bringing a total 51.74 sen for 2015 compared to just 10.25 sen for 2014), its share price closed at RM3.76.

What happened the next trading days scared off investors. Its share price dropped to RM3.49, a drop of 27 sen and it was amongst the top ten losers of the day! Perhaps most investors were very disappointed with the paltry dividend of 5 sen only.

Investors must have anticipated a bumper special dividend of at least 50 sen this time. The last time CCB paid a special dividend was in 2006 and the amount was as much as RM2.03. So perhaps after a ten years lapse of special dividend, investors were fervently betting of a special dividend this time.

Sadly it did not materialize and this could be the reason the share price dropped so much. At the close of today, April 14, the price is RM3.59 which is still down by as much as 17 sen compared to the price of RM3.76 on Feb 22.

Finally NTPM Holdings Berhad. In case you are not sure what NTPM stands for, it is Nibong Tebal Paper Mills. Actually, I learned it from some reports too.

On Mar 25, NTPM reported an excellent 3rd Qtr 2016 results of 1.6 eps, which is higher than 1st Qtr & 2nd Qtr's 1.2 eps and 1.5 eps respectively. It closed at RM1.06 although it touched a high of RM1.09 on Mar 23.

Instead of surging higher the next trading day after the good announcement results, it dropped as much as 6 sen instead and closed at RM1. At the time of writing on April 13, NTPM's share price is still hovering below RM1 and last traded at 97 sen.

Seriously how many of us noticed or experienced this type of share price falling down situation despite announcing a better result? I bet most of us won't feel it until it happens to our very own shares.

What can we conclude from these three disappointing situation?

For one, investors should not put too much hope each time a better Qtr result is announced. There is no guarantee the share price will react positively after the announcement. If it moves up positively after the announcement, it might not stay there for long once the euphoria is down.

But at least a better result announcement is still better than a poorer result announcement. Isn't it?

Ha ha, that is the intriguing aspect of investors' sentiment towards a share each time a Quarterly result is announced. It is one I still find it hard to grasp with despite all my years of experience.

CK must be one of my favourites followers/readers. For the second consecutive time, ck has been emailing me with a couple of questions.

On April, 1, ck asked : which export-oriented stocks are you looking to buy?

Good question. There are a few, but it has not fallen to the price target I have set in. I also have a target price to buy for each stock. But what if three different stocks of my choice hit the target price at almost the same day? Would I be buying all?

No, the answer is a firm NO. I would buy one and still patiently wait for another time (depending on whether I choose to make a purchase every one month or so).

In this way, I believed I have applied the average way of investing consistently periodically. I strongly believe this is a good strategy provided one is willing to hold on and buying for mid to long term.

Anyway, I have decided to make another purchase and the stock is ....

Buying 4,000 shares of

BP Plastics Holdings Bhd

at RM1.57 on April 14, 2016.

I shall elaborate more about this company in my coming blog.