Wednesday, January 15, 2014

Value of investment after 24 months

Dear all,

It is the end of another good year. In this post, we will see how much we have gained for the past two years for the stocks that we have bought in January 2012.

If you refer to the table below. I would say that we have a very good investment portfolio. There may be some changes that we need to make. McDonald's has not been making good progress. This may be because McDonald's have been categorised as a Value Company instead of a Growth Company. The other companies are still able to give us a double-digits growth, hence we should be happy with the growth in our investment.

Our total growth is still good at 20.4% compounded for 2 years. It means that if we were to invest $10,000 in the January 2012, We would have $14,500 today. This $4,500 gain is so much more than the meagre interest that you would earn in fixed deposits. 20.4% compounded gain is also higher that the average inflation of 6% for the past two years. Meanwhile, I am still happy with the current investment and let's see how much we will get at the end of 2014.

Cheers.

Disclaimer: Readers are advised to exercise their own discretion when investing. Stock investment is considered high-risks

Company 1/2/2012 31/12/2013  Total Dividend  Dividend Yield Percentage Gain/Loss Compunded Gain/Loss
US-listed Companies
McDonald's  $ 99.390  $ 97.030  $ 6.690 6.7% 4.4% 2.2%
Coca-Cola  $ 69.700  $ 82.620  $ 4.790 6.9% 25.4% 12.0%
Starbucks  $ 46.170  $ 78.390  $ 1.780 3.9% 73.6% 31.8%
Walt Disney  $ 38.850  $ 76.400  $ 0.750 1.9% 98.6% 40.9%
Las Vegas Sands  $ 43.760  $ 78.870  $ 5.150 11.8% 92.0% 38.6%
Total Investment  $ 297.870  $ 413.310  $ 19.160 6.4% 45.2% 20.5%
Singapore-listed Companies
Singpost  $ 0.935  $ 1.350  $ 0.125 13.4% 57.8% 25.6%
SPH  $ 3.740  $ 4.000  $ 0.640 17.1% 24.1% 11.4%
Breadtalk  $ 0.550  $ 0.895  $ 0.033 6.0% 68.7% 29.9%
Popular Holdings  $ 0.164  $ 0.240  $ 0.023 14.0% 60.4% 26.6%
Total Investment  $ 5.389  $ 6.485  $ 0.821 15.2% 35.6% 16.4%
Grand Total  $ 303.259  $ 419.795  $ 19.981 6.6% 45.0% 20.4%

Thursday, August 1, 2013

18 months report card

Hi everyone,

Sorry to have kept you waiting. It's has been almost a year after my last post talking about our investment report card 8 months after the new stock selection in January 2012. For the past year, Jac's Learning Centre Pte Ltd was undergoing a merger. After the merger, we have set up new branches and coming up with new projects have kept me busy for almost a year and I really missed sharing my investment views with you. For more information about our branches and new projects, please refer to http://www.jlc.com.sg

It's nice to be back and I want to show you that the investment choices that I have made in January 2012 allowed me to sleep comfortably at night. I wanted to show you that once you have made a sound investment in good companies, you can focus on your work without any worries.

18 months has passed since my last selection of companies in January 2012. Let us look at the gains that we have made with those investments.



CompanyPrice on
4 January 

2012
Price on
29 July 2013
Total Dividends
for  
past 18 months
      Percentage
         gain/loss (include dividend)
US-listed Companies
McDonald's $     99.39 $          97.87       $   5.110+3.6%
Coca-Cola (Split on 13/8/12) $     69.70 $          80.56       $   3.670+20.8%
Starbucks $     46.17 $          72.45       $   1.310+59.8%
Walt Disney $     38.85 $          64.61       $   0.750  +68.2%
Las Vegas Sands $     43.76 $          54.85       $   4.450+35.5%
US Performance $  297.87 $       370.34       $   15.29+29.5%
Singapore-listed Companies
Cerebos Pacific (Privatised) $       5.040 $            6.600       $    0.25+35.9%
Singpost $       0.935 $            1.305       $    0.0875+48.9%
SPH $       3.740 $            4.39       $    0.490+30.5%
Breadtalk $       0.550 $            0.995       $    0.028+86.0%
Popular Holdings $       0.164 $            0.280       $    0.023+84.8%
Singapore Performance $     10.429 $          13.570       $    0.8785+38.5%
Overall Performance $   308.229 $          383.91 $    16.1685+29.8%


Our overall performance has gained about 30%. It means that every $10,000 invested, the investment has grown to $13,000. If you noticed, all the companies have made positive gain with 90% of them earned more than 20% each. The best investment would be Breadtalk and Popular Holdings, with both increased by 85%.

Other than Cerebos Pacific, which was delisted, due to privatisation, all the other companies still have potential to bring us good growth in our investments.

Since Cerebos Pacific was delisted, I would invest the money into the recently launched SPH REIT, and be a "commercial landlord". This REIT will enable us to collect rent every quarter.

Please feel free to comment and share about your thoughts.

Cheers.

Disclosure: Writer owns Popular Holdings shares.
Disclaimer: Readers are advised to exercise their own discretion when investing. Stock investment is considered high-risks

Saturday, August 11, 2012

Jac's selection for first 8 months...

It's almost three-quarters of a year. Let us relook and reflect on my selection in the beginning of the year. Take a look at the summarised table below.

Company Price in 4 January  Price on 10 August  Total Dividends for past 8 months Percentage gain/loss
US-listed Companies
McDonald's  $     99.390  $          88.200  $                          2.100 -9.1%
Coca-Cola  $     69.700  $          78.790  $                          1.530 15.2%
Starbucks  $     46.170  $          45.570  $                          0.510 -0.2%
Walt Disney  $     38.850  $          49.650  $                                 -   27.8%
Las Vegas Sands  $     43.760  $          38.950  $                          0.500 -9.8%
US Performance  $  297.870  $       301.160  $                          4.640 2.7%
Singapore-listed Companies
Cerebos Pacific  $       5.040  $            6.550  $                          0.250 34.9%
Singpost  $       0.935  $            1.060  $                          0.050 18.7%
SPH  $       3.740  $            4.060  $                          0.070 10.4%
Breadtalk  $       0.550  $            0.555  $                          0.015 3.6%
Popular Holdings  $       0.164  $            0.235  $                          0.005 46.3%
Singapore Performance  $     10.429  $          12.460  $                          0.390 23.2%
Overall Performance  $     367.87  $          373.85  $                            5.96 3.2%

McDonald's and Las Vegas Sands has the greated value loss of just less than 9.1% and 9.8% respectively. I still have faith in these two companies and I am confident they can make my investment grow. It may be a good time to stockpile McDonald's shares.
The US portfolio still has an overall 2.7% gain in value.

Meanwhile, all the five stocks that I have picked for the Singapore portfolio has gained 23.2% for the past 8 months. Cerebos Pacific has made an exit offer of $6.60 per share. Shareholders not only enjoyed the good $0.25 dividend and a surprise windfall as well.  If you have bought this share at the beginning of the year, your savings would have gained 35% in just 8 months.

Singpost and SPH has gained 18.7% and 10.4% respectively. This healthy gain signals that we should continue to hold on to these two stocks. Breadtalk's value increases only a mere 3.6%.

Lastly, I will talk about Popular. If you have read my last post, you would have known that Popular Holdings' Chairman has increased his stakes. Even after that post, he continues to increase his stake even at $0.235. This can only tell me one thing, Mr Chou is very confident of Popular Holdings in the years to come.

Please feel free to comment and share about your thoughts.

Cheers.

Disclosure: Writer owns Popular Holdings shares.
Disclaimer: Readers are advised to exercise their own discretion when investing. Stock investment is considered high-risk.

Thursday, June 21, 2012

When is the right time to buy another property?

Anytime, I would say.

Do not allow any measures to stop you from buying into any investment properties. And do not TIME the purchase of a property. You may be happy when prices fall, but you may also be angry when prices go up. We should control the situation and not let the situation control us.

Property prices out there are still at a very high selling price. But there are bound to have a few that are undervalued, which we have not discover yet. Keep on finding. Go to different showrooms and open houses to see and compare.There is close to zero percent chance that property prices will fall to the 2008/2009 prices. 

For the past one year, I have been going around house-hunting. Visit the different showflats around the island, screening through the Straits Times Classified, and surfing the Internet to find more properties on sale. Till now, I am not able to find a single property that can attract me to open my warchest to buy. 

I am really disappointed with the current situation, but I do not wait for the property come to me. I will still continue to search for undervalued valuable properties. When I found one, I will not hesitate to buy. And you should too.

Another round of cooling measures to follow? We'll just wait and see.

You may want to refer back to my post, "Singapore Property : Buy or hold till recession?" for a refresher.


Cheers.

Sunday, May 27, 2012

Why the sudden surge in Popular Holdings shares?

From 1 March price of $0.169 to 25 May price of $0.199. That's a 17.75% increase in just 3 months. Have you wondered why is there an increase?

If you have searched SGX's company announcement website, you would have notice that there is some insider transactions reported in the months of April and May.

On 02 April announcement, Mr Chou make an open market purchase of 3.173 million shares at average price of $0.17741 on 30 March.
On 09 April announcement, Mr Chou make another open market purchase of 250,000 shares at average price of $0.179 on 5th April.
On 14 May announcement, Mr Chou make another open market purchase of 256,000 shares at average price of $0.182 on 11 May.
On 17 May announcement, Mr Chou make another open market purchase of 4.935 million shares at average price of $0.188 on 16 May.
On 21 May announcement, Mr Chou make another open market purchase of 1.796 million shares at average price of $0.185 on 18 May.
On 24 May announcement, Mr Chou make another open market purchase of 3.098 million shares at average price of $0.191 on 23 May.

All in all, his company, also registered holder, World Holdings (Pte) Limited, has bought 13.508 million shares. The total cost for these transactions is $2,506,021.93.

I doubt Mr Chou is stopping to acquire Popular shares in the near future. I still feel that Popular Holdings is still an undervalued company. At the current price of $0.199, its P/E ratio is only 5.85 for trailing 12 months earnings of $0.034. Still consider a steal in the stock market.

9 months earnings of Popular Holdings is at $0.0314. They are going to annouce their 4th quarter and full year results end June 2012. I am optimistic about their 4th quarter results and full year earnings ending 30th April 2012. The amount of dividend that they are going to give may be better than previous years.

In the past two months, I have also increase my position by another 6%. Hope you have got yours too.

Happy investing.




Disclaimer: All the information here is blogger's personal views. It should not be taken as a call to buy or sell the shares. Investors are advised to exercise their own discretion when it comes to buying of shares, as all kinds of investments carry risks.

Disclosure: Blogger has Popular Holdings shares.

Wednesday, May 2, 2012

What is the right amount to invest?

Investment is a process to make a profit from the capital for a period of time. In other words, it is a process to grow savings at a reasonable rate to beat the inflation and enough for retirement. However, every investment involves risk. Risk appetite of the investor is one important factor. So, how much money should one invest?

Different people have different risk appetites when it comes to investment. Some people is willing to put their money in fixed deposits, where capital is guaranteed. Even if the interest is only about 1%, they can have peace of mind that they money are save. Some people have larger risk appetites, where returns are much higher. But bear in mind that investments with higher risks can also make one lose their money at an alarming rate.

In order to make the suitable investment, we have to ask ourselves this question, "Are we ready to make a failed investment?" No one likes failed investments, neither do I. That is why doing "homework" is important. Even when I have made a wrong decision on investing in a particular company, I accept the consequence of losing the money and learn from it. Recently, I bought an IPO of Genting's perpetual securities. First mistake, I assume that perpetual securities is the same as bonds or preference shares. In fact, they are ranked lower than bonds and preference shares. Second mistake, I did not find out more about it before investment. I sold them right after it's open for trading. Luckily, I lost $26 only. This $26 lesson will wake me up and be more diligent. 

After this "failed" investment, a phrase appeared in my mind like a flash. "Only invest the amount of money that you are willing to lose." By following this phrase, I invest with a peace of mind. If the investment is lost, take it as a lesson learnt. If the investment is right, then our savings will grow at double digit rates. Not only have we beat inflation, we can also retire comfortably.

Here's an example.

Sam is married and have two children. His family managed to save $20,000 after 5 years. What should he do with the savings? 
1.   Put all the money into fixed deposit that gives a rate of about 1.5% per annum, and capital is 100% safe.
2.   Put all the money into stocks that can grow at a rate of 8% per annum, but there is a risk to lose a lot of money.
3.   Put 50% in fixed deposit and 50% into stocks.
4.   Set aside $15,000 in fixed deposit as emergency cash and $5,000 in stocks.

Which of the above choices is the wisest?

It is important to set aside some money for emergency, even if these money value depreciates due to inflation. Once the amount is set, invest the rest of the savings. If the $5,000 is lost due to failed investment, there is still $15,000 to fall on for any emergency. But if the $5,000 is growing at a double digit rate after investing in the right company, savings can growth at reasonable rates to beat inflation too.

Many friends and relatives asked how much money should they invest. My reply is always the same. Set aside the right amount of emergency cash reserves and invest the rest at their comfort level. Of course before investment, we will do research with our diligence and minimize the risk to the lowest possible. Only in this way will we have many successful investments.

Personal finance is for one to decide on his own. It is not for the financial consultants to decide what to do with the money. A responsible financial consultant will only give advice and will never push the customers to invest in a certain product. Take control of your own finances.

Cheers and happy investing.




Friday, April 13, 2012

1st Quarter performance of Jac's picks for 2012

Q1 in 2012 was considered a good quarter for investors. If you remembered my post in January 4, 2012, I had picked 10 companies to invest in. The 10 stocks have increased about 11.1% for the whole quarter. Separately, The chosen US-listed companies has grown 11.5% and the chosen Singapore-listed companies has grown 10.0%. A summary of the growth in value of the different companies are as follows:-

Company  Price in 4 January   Price on 5 April  Percentage gain/loss
US-listed Companies
McDonald's  $                   99.39  $                 98.62 -0.77%
Coca-Cola  $                     69.70  $                 73.47 5.41%
Starbucks  $                     46.17  $                 58.18 26.01%
Walt Disney  $                     38.85  $                 43.08 10.89%
Las Vegas Sands  $                     43.76  $                 58.76 34.28%
Singapore-listed Companies
Cerebos Pacific  $                     5.040  $                 5.810 15.28%
Singpost  $                     0.935  $                 1.030 10.16%
SPH  $                     3.740  $                 3.870 3.48%
Breadtalk  $                     0.550  $                 0.575 4.55%
Popular Holdings  $                     0.164  $                 0.184 12.20%
Overall   $                   308.30  $              343.58 11.44%

Sunday, March 4, 2012

The water dragon...and when to invest.

Dear readers,
This blog has been quiet for the past month as there hasn't been any new events that create buying opportunities. In this post, I will include some formulae for you to do your own calculation. Please note that these formulae suit me in my investments and some investors may have their own investment formulae.

I have been using the same formula

Future value = Present Value x (1 + Rate/100)^years

All I need to do is to manipulate the formula into other formulae. With this single formula I am able to calculate the future value of the earnings, share value and revenue. I can also calculate the present values, at what rate is the value growing. These are the 3 things that interest the value investors.

The Microsoft Excel can also help us in our calculations. For now, I will just teach you the RATE function.
By typing "=RATE(number of years,,first value, final value)" Excel will return a value in percentage format. For example, 12.4% means that the figures are growing at a rate of 12.4% compounded for the number of years you keyed into the formula. There is no mistake in the function, you need to type two commas after the number of years.

We use the RATE function to calculate the rate of growth of sales, equity or net asset value (NAV), cash generation and earnings per share (EPS). Why do we need to know the growth rate? These four components form the heart of a company. A business needs to have growth in these four components in order for the company to grow. As a rule of thumb, any company that doubles their value in five years is a value company to invest in.

Meanwhile, enjoy doing your homework.

Cheers.

Monday, January 30, 2012

Cerebos Pacific Limited (CPL) & SingPost

Dear readers,

Jac wishes all a prosperous dragon year. May all investors reap in good profits this year.

CPL and Singpost announced results yesterday. I shall talk about SingPost first.

Singapore Post's Q3 net profit declined 5.2%, still manageable. They are still giving out an interim quarterly dividend of $0.0125 per share, that is, a 10,000 shareholding will earn $125 on 29 February. Anyway, SingPost is a dividend stock, as of now. I am still looking at how the company is going to invest the cash they have in hand. If you were to buy SingPost shares at $0.94 last month, the expected dividend yield for 2012 will be 5.3% per annum. This percentage is calculated using 5 cents total dividend for this year. There may be more dividends in the 4th quarter.

As for CPL, it is a bit more complicated than what is reported. The company compares only their Q4 results, hence reporting a net profit drop of 20%. Why did CPL compare only Q4 rather than the full year results? It was because CPL has changed their financial year from September 30 to December 31. In 2010, the company reported a total of 15 months results instead of the usual 12 months. Hence, it is very difficult to compare a 12 month results to a 15 month results.

However, as investors, we shall be a little more hardworking than anyone else. I have compiled a 12 month results for CPL for 2010. I took the company's results for four quarters in 2010 and add them up to make the result of one financial year of 12 months. Only then, we are able to make comparisons of results year on year.

As we know Thailand's massive flood has caused almost all the companies there to be affected. Cerebos did not escape this disaster either. In fact, their sales were adversely affected by the distribution disruptions. A stronger Singapore dollar against Thai Baht also affects the profit as Thailand is the group's largest market for Cerebos' products.

Comparing year on year, CPL's 2011 revenue was $977 million compared to 2010's $936 million. This is actually a 4.4% increase. Net profit attributable to shareholders for 2011 is $100.1 million compared to $108.7 million last year. This is a drop of 8.0%. It is still considered acceptable. Earnings per share dropped 8.3% from $0.3442 to $0.3155. As a shareholder of CPL, I am still comfortable with the drop in earnings, due to the natural calamity. Of course, the shareholders hope that this dragon year can bring better results.

CPL will be distributing a dividend of $0.25 per share in middle of May 2012. Holding 10,000 shares will earn the shareholder $2,500. The elderly couple that is still holding to their CPL shares has gained a dividend yield of 5.6%. This high dividend yield is due to the fact that they bought the shares at the price of $4.48 per share. In total, this elderly couple earns a total of $0.58 per share dividend for investing in the company for 2 years. Including the increased in share value, the couple's investment into the company has grown by 31.7% for two years. Their invested savings have compounded at a rate of 14.8% per year for two years. Not a bad defensive investment after all. 



Disclosure: Jac is holding on to CPL and SingPost shares at the time of writing this post.

Disclaimer: This post should be used as a reference to educate novice investors. Any kind of investment involves risks. Investors are advised to exercise their own discretion when investing their money. 



Wednesday, January 4, 2012

Jac's picks for 2012

Hope 2011 has been a great year for you.

2012 has begun and the first two days' tradings show some positive note. I have also made some changes to my top picks. The companies listed below are not ranked.

1.    McDonald's, US
2.    Coca-Cola, US
3.    Starbucks, US
4.    Walt Disney, US
5.    Las Vegas Sands, US
6.    Cerebos Pacific, Singapore
7.    Singpost, Singapore
8.    SPH, Singapore
9.    Breadtalk, Singapore
10.  Popular, Singapore

Please take note that the list are my personal picks. Readers should us it as a reference only.

Disclaimer: Any investment mentioned here is meant to be illustration only. Every investment involves risks. Readers are advised to exercise their own discretion when investing their own money. Writer of this blog shall not be held responsible for any failed investment made.