Sunday, December 8, 2019

Dow - More likely on major wave 9

Dow (28,015)

After plunging through its upper trendline with a gap on Tuesday, Dow regained 513 points in the next three trading days to move back to above the upper trendline again. It appeared to me that Dow is more likely to be in its major wave 9. Very likely Dow has just completed the wave (i) of its major wave 9.

With this wave count, Dow is likely to move lower in the next few months to complete its wave (ii) of major wave 9.

However if Dow can continue to move higher from its current level with more record highs, the only possibility is as shown below - Dow is at the tail end of its wave (i) of its major wave 9.

And of course, it may be unlikely at this moment but it may be good not to rule out the worst possible scenario, the wave A-B-C-D-E for major wave 8.

FBMKLCI (1,568)

KLCI continued with its wave C of mega wave (6) formation.

Looking at its 2-Year chart, KLCI is either at the wave ix, the last wave of C, if I do not take the magnitude of the various rebounds into consideration.

But if I take the magnitude of rebounds into consideration as shown in the following chart, Wave C of mega wave (6) may need more time to complete.

Pinehill Pacific Bhd (Rm0.475)

Based on the quarterly report of Pinepac for quarter ending 30/9/2019, its earning reported is 71.66 sens a share  and net assets has increase to Rm1.49 a share. From its latest balance sheet, it has a net cash per share of 77 sens. After selling off all its plantation in Perak, Pinepac still has 51,000 acres of plantation land in Indonesia located near the southern border of Sarawak. Out of these 51,000 acres, 21,000 acres are matured oil palm estate. Pinepac at 47.5 sens is very cheap.

From its 5-Year chart, very likely Pinepac is forming its major wave 3 currently. OBV is very bullish. Price breakout is to be expected following its OBV breakout.

From its 6-Month chart, it is either at its sub-wave vii of wave (i)

Or it has just completed its wave (i).

Malayan United Industries Bhd (Rm0.215)

Mui put on two green candlesticks on Thursday and Friday with improved volume. It is quite likely that Mui has started its minor wave (iii) of its sub-wave i. Is Mui going to announce the successful sale of its Corus Hotel Hyde Park London very soon ?


Wednesday, December 4, 2019

Malayan United Industries Bhd (Rm0.20)

On 14 December 2018 Tan Sri Khoo Kay Peng resigned as the executive chairman of Mui and was replaced by his son Andrew Khoo Boo Yeow.

Less than 24 hours after the announcement of his appointment as the new executive chairman of Mui, Andrew Khoo met with the press to reveal his ambitious plan for the loss-making company. Mui has been in the red since 2014. His plan was to turn Mui around in two years with profit and be able to give shareholders dividend.

One of his strategic thrusts for the Mui is to rationalise the group assets.

On 30 April this year, Mui informed Bursa Malaysia that its wholly owned unit Corus Hotel Ltd has appointed N.M. Rothschild and Sons Ltd as its financial adviser on the sale of Corus Hotel Hyde Park, London. Andrew revealed that the group had received an offer of slightly more than 200 million pound (Rm1.09 billion) before Rothschild's appointment. In May Andrew Khoo said that he hoped to be able to identify a buyer within the next 3 to 4 months.

By now 6 months has passed since Rothschild's appointment, I just wonder whether Mui has already identified a buyer and has proceeded to finalise the S&P agreement ? But one thing is for sure, Mui's share price will fly when there is announcement to Bursa Malaysia on the buyer for the Hotel.

From the chart, it is wave (1)-(2), 1-2 until December 2018. In 2019, Mui has formed mini wave 1-2-3-4. From the 6-month chart, Mui is about to complete its minor wave (i)-(ii), minor wave (iii) is getting ready to start.

At today closing price of 20 sens, Mui's market cap is Rm587 million, Corus Hotel Hyde Park alone is already more than its market cap by Rm483 million or 82% without considering its other Hotels/properties and businesses.


Tuesday, December 3, 2019

Dow - Down with a gap

Dow (27,502)

When President Donald Trump signed into law the congressional legislation 'The Hong Kong Human Rights and Democracy Act 2019' last Wednesday, Dow still managed to hold above the upper trend-line on Friday after the Thanksgiving holiday on Thursday. Dow formed a long red candlestick on Monday followed with a gap down on Tuesday.

In addition to that, the index has moved below its upper trend-line.

Since it failed to pulled away and maintained above its upper trend-line, I have no choice but to bring one of my previous scenario of wave D and E. This is very bearish.

Besides this scenario, there is another less bearish scenario that I mentioned 3 weeks ago in my article dated 16 November.

There is this possibility that Dow is forming an overlapping i-ii-iii-iv-v wave (i). Wave (ii) is expected to be a 10% or less correction to around 25,700 to 25,300 level.


Monday, December 2, 2019

Dow - Is Dow pulling away?

Dow (28,051)

As Dow is pulling away from its upper trend-line, probability is getting higher that Dow is forming its major wave 9.

Hopefully the next pullback can hold above the upper trend-line then I can forget about the A-B-C-D-E major wave 8 option.

Pinehill Pacific Bhd (PN17) (Rm0.47)

Pinepac announced earning of 71.66 sens a share with net assets at Rm1.49 a share due to its one-off gain from its disposal of 8,999.13 acres of land for Rm413.574 millions.

Under its current assets, it has cash of Rm185.611 million

Under its liability table, amount payable and borrowing added up to Rm70.155 million.

Its net cash position is Rm115.456 million, that is about 77 sens a share. Besides its cash, Pinepac still has 51,000 acres of land in Indonesia with 21,000 acres of mature oil palm. At today's closing price of 47 sens, it is greatly undervalued.

Pinepac is forming its major wave 3 at this moment.

From its 6-month chart Pinepac is at its sub-wave vii.

Fintec Global Bhd (Rm0.055)

Fintec as expected announced earning of 13.64 sens a share with net assets at 38 sens a share. Its stock price went to a high of 9.5 sens on Tuesday but closed at only 5.5 sens today. Pinepac continues to lose money on its business operation. The good earning came from the fair value gained of its investment holdings.

The rebound to 9.5 sens completed the wave (iv) of its wave C of (2). The current wave (v) may see Fintec to retest its historical low of 4 sens one more time before starting its mega wave (3).


Sunday, November 24, 2019

Last week for quarterly report announcement.

Pinehill Pacific Bhd (PN17) (Rm 0.30)

For those companies that have yet to announce their quarterly earning ending 30/9/2019, they must announce by next Friday (29/11/2019). Pinepac is one of such company and must announce its result within the next 5 working days. It is going to be very interesting to see what sort of earning Pinepac is going to announce.

On 3 September 2019, Pinepac announced that the company has completed its sale of 8,999.13 acres of plantation to United Plantation Bhd for Rm413.574 million after receiving the balance of outstanding payment.

The book value stated in its annual report is Rm240.046 million. Surplus over book value is Rm173.528 million. Pinepac has 149.8 million shares, surplus value per share is Rm1.16. Is Pinepac going to announce an earning of more than one ringgit for its quarter ending 30/9/2019 and with net assets increase from Rm0.43 to Rm1.59 a share?

After paying off all borrowings totaled Rm186.047 million, this PN17 net cash company is having cash of Rm227.527 million or Rm1.52 of cash per share. Pinepac was selling at 30 sens last Friday. Looked funny. Or is there anything that I am not aware of?

From the chart, Pinepac has completed its major wave 2 on 14 October at 24.5 sens.

Fintec Global Bhd (Rm0.075)

Fintec is expected to announce good result because of asset revaluation surplus.

Fintec is a technology incubation and investment holding company. It is holding shares in six listed companies, namely Focus Dynamics Group Bhd, Vsolar Group Bhd, AT Systematization Bhd, Netx Holdings Bhd, DGB Asia Bhd and Mlabs Systems Bhd.

For its previous quarter ending 30/6/2019, Fintec announced earning per share of 4 sen with net assets per share of 28 sens due to fair value gain of Rm19.74 million on quoted securities.

Fintec must announce its earning for quarter ending 30/9/2019 within the next 5 trading days. During period from 30/6/2019 to 30/9/2019, the total market value of its six listed company has further increased by Rm75 million. The contribution is mainly by Focus, its share price has increased from 19.5 sens to 36 sens during the period and Fintec is holding 500.6 million shares of Focus.

Divide Rm75 million by Fintec's number of share (638 million), the fair value of its investment holdings increased by 11.7 sens. Is Fintec going to announce an earning of 11 sens  and net assets of 39 sens for its quarterly result ending 30/9/2019? Just wait and see.

From Fintec's 10-Year chart, its current rebound is the wave 4 of its wave C of its mega wave (2). Theoretically it has to end around 11 sens, another 3.5 sens (+45%) to go.

Insas Bhd (Rm0.86)

Insas is forming its mini wave 4 at this moment. There is one more 'up', the mini wave 5 to complete its sub-wave iii. It is a slow and frustrating stock.

Dow (27,875)

Dow started to move lower last week. If it can hold above its upper trendline and can continue to move higher and higher, it is major wave 9 in progress.

But if Dow were to drop below its upper trendline and continue to move lower and lower, then it is forming the wave E of its major wave 8.The 3 possibilities I mentioned in my previous week posting still hold.

The most important issue now is whether the US President going to veto the Hong Kong Human Rights and Democracy Acts.


Saturday, November 16, 2019

Dow - Another new record high

Dow (28,004)

The Dow surged to a new all-time record high of 28,004 on Friday after White House economic adviser Larry Kudlow says the U.S and China are 'getting close' to reaching a trade deal.

The new high of 28,004 is +2.2% higher than Dow's previous high of 27,398 and is above the upper trendline by +1.5%. From its daily chart, probability is getting higher that Dow's December 2017 low of 21,712 is the end of its major wave 8 and since January 2018, the Dow has been forming its major wave 9.

The wave count shown above is a very very bullish wave count - Dow is at its mini wave 3 of sub-wave iii of wave (iii). At the wave 3 of iii of (iii) Dow has to be very dynamic with an unmistakable, euphoric run with very high volume and with great magnitude, pulling away from the 28,000 level. Failure which, a less dynamic alternative wave count in the following chart is more likely, in view of the different stands between the US and China on roll-back of tariffs. Trump said that he hasn't agreed to roll back tariffs whereas the Chinese insisted that since the trade war was started by the imposition of tariffs by the US, any deal with the hope to end the trade war has to start with the roll back of tariffs, a prerequisite to the Chinese government.

This alternative wave count shows that Dow is still on its major wave 9 heading for 34,000 level, but at this moment it is about to end the sub-wave v of its wave (i) at around 28,500 level to be followed by a 10% wave (ii) correction.

Another question now is whether there is any possibility left for my previous A-B-C-D-E corrective wave count for the major wave 8?

At this height of 28,004 for the Dow, I am still able to come out with a wave count that is still looking alright for that possibility but I have to admit that this is the extreme end for wave D of the A-B-C-D-E wave count and Dow must start to drop from this level, strictly no more going up beyond 28,004. Another one to two hundred points up from this level will spell the end for this possibility.

Still looks alright for an expanding triangles with a 1.5% overshot for wave D.

FBMKLCI (1,594)

KLCI continues to form the last part of its wave C of (6).

From the 2-Year chart, there are two possible ways for CI to complete its wave C. First way is to have a rebound to 1690 level to form a wave (iv) before going lower

Second way is to have an overlapping 9-wave C with a slight rebound to 1,620 level to complete the wave viii before the final wave ix drop.


Thursday, November 14, 2019

Malayan United Industries Bhd (Rm0.20)

Mui is another greatly undervalued stock.

Since 2008 Mui has been moving side way until today. Its movement has been confined by an upper declining trend line and a horizontal bottom trend line.

Very likely Mui has completed its mega wave (2) by end of December 2016. Since January 2017 Mui has formed its major wave 1-2 and it has started forming its major wave 3 since December 2018.

If I am right, Mui is currently forming its sub-wave v. It has just completed its mini wave 2 and is about to start the mini wave 3 of its sub-wave v. My bet is - Mui is going to punch through its upper trend line soon.

On 30 April this year, Mui announced that its has appointed an international investment bank, N.M. Rothschild & Sons, as its financial adviser on the sale of Corus Hotel Hyde Park in London.

In fact in 2014, The Edge Financial Daily reported that Mui was seeking to divest the hotel for 200 million pounds or Rm 1.06 billion.

From Mui's latest annual report, the book value for this hotel is Rm251.661 million. If Rothschild is able to sell the hotel for say Rm1.0 billion, the surplus above its book value is about Rm748 million or 25.5 sens a share.

Mui with cash in hand of Rm241 million and borrowing of Rm115 million, net cash is Rm126 million. If the hotel can be sold for Rm1.0 billion, Mui would be having cash of Rm1.126 billion. If divided by its total number of share of 2,932 million, cash per share is about 38.4 sens, which is 18.4 sens or 92% higher than its current price of 20 sens.

Excluding Corus Hotel Hyde Park, Mui has another 7 hotels in the UK and 2 Corus Hotel in Malaysia with a total book value of only Rm264 million. I believe the total current market value for these hotels can be another billion Ringgit or more.

Besides hotels, Mui has other properties all over Malaysia, in Singapore, Hong Kong, Australia and in the US.

Mui's retailing division are Laura Ashley Holdings (UK) and Metrojaya Bhd (Malaysia).

Mui is also the major shareholder of Pan Malaysian Corporation Bhd, Pan Malaysian Holdings Bhd and Mui Property Bhd.

Mui at 20 sens a share is definitely undervalued.


Wednesday, November 13, 2019

Pinehill Pacific Bhd (Rm0.28)

On 21 September 2018 Pinepac announced its proposed disposal of all its plantation assets in Perak of 8,999.13 acres to United Plantation Bhd for a total cash consideration of Rm413,574,302.49.

Within 2 days after the announcement, its share price went from a low of 14 sens to an intraday high of 69 sens. After the initial euphoria, Pinepac started to consolidate in a side-way movement for more than a year. Technically there is a possibility that it has completed its major wave 2 consolidation.

On 3 September 2019, Pinepac announced the completion of the disposal following the payment of the Balance Purchase Price by the purchaser and the transfer and registration of the title deeds for the plantation assets in the name of the purchaser.

But upon the completion of the S&P, Pinepac automatically becomes a PN17 company because it had disposed off its main business that contributed more than 90% to its revenue. Pinepac has to submit a Regularisation Plan within a year to the SC for approval on its new business plan.

Since Pinepac has received all its Rm413.57 million by 3 September 2019, this sum will have to be reflected in its coming quarterly earning that it must announce before end of this month (November).

From its previous annual report, the book value of the assets was Rm240.05 million. The surplus over the book value is Rm173.52 million and it has to be reflected as earning for the quarter. If I divide Rm173.52 million by its number of share of 149.8 million, I get Rm1.15 per share.

Before end of this month, for quarter ending 30/9/2019, is Pinepac going to announce an earning of Rm1.15 a share and with its net assets per share improved to Rm1.58 from Rm0.43?

I am not trained in accounting, as a layman, what I have done is a simple 1+1=2 kind of things. I have to wait for the coming Pinepac announcement to see how good or how bad is my computation.

If I less all its liability (borrowing, taxes, amount payable and amount due to its Directors) of Rm293.12 million from the cash that it received Rm413.57 million, the balance of cash is Rm120.45. Divided by its total number of shares of 149.8 million, net cash per share is Rm0.80.

My simple thinking is - If I buy this stock, I am actually paying 28 sens a share for 80 sens cash per share plus a company that still has 51,400 acres of leasehold land (60-year lease) in Indonesia that consists of 22,100 acres of matured oil palm.


Tuesday, November 12, 2019

Fintec Global Bhd (Rm 0.075)

As a follow up to my previous article on Fintec dated 19 October, 2019, when Fintec was hovering around 4.5 sens, I said that Fintec was about to complete its sub-wave v of its wave (iii) of C of its mega wave (2) without realising that it has already completed its sub-wave v of (iii) on 3 October with an intraday low of 4.0 sens.

Fintec gained 0.5 sen (+9%) yesterday with a high volume of 15.5 million shares. At the close of today's trading Fintec gained another 1.5 sens (+25%) with an even higher volume of 25.5 million shares.

Currently Fintec is forming the sub-wave i of its wave (iv). Technically Wave (iv) is likely to end around 11 sens before the starting of its final drop, the wave (v) to complete the wave C of (2).

I also mentioned in my October 19 article that this is a greatly undervalued stock that was selling at 4.5 sens (at that time) but it has a net cash per share of 3.7 sens and with its investment holding that is worth 34 sens a share. I also mentioned that its main problem was its operating profit that has been in the red for a long time. Its last quarterly earning (ending 30/6/2019) of 4 sens a share was contributed by the increase in market value of its investment holdings.

For the coming quarterly earning for quarter ending 30/9/2019 that Fintec has to announce by 29/11/2019, the market value of its investment holding has increased by another 75 million during the quarter, that is about 12 sens per share. Is Fintec going to announce its next quarterly earning at 12 sens per share and with a corresponding increase in its net assets to 39 sens a share? Just wait for another two weeks for the answer.


Saturday, November 9, 2019

Dow - New record high

Dow (27,681)

Dow set an intraday high of 27,774 on Thursday. This is the third time since January 2018 (when Dow has completed its major wave 7), Dow has moved into new record territories. The previous two occasions were at point B when the new intraday high was 1.29% higher than that at point 7 before it plunged 16% ; and at point D when the intraday high was 1.66% higher than that at point B before the current side way consolidation. So far the new high of 27,774 is 1.37% higher than that at point D, there is still a possibility that it will go south to complete the wave iii of E unless it can move above 28,000 with a new high that is more than 2% higher than that at D.

If Dow is able to move higher than 28,000 and stayed above the upper trendline, I will have no choice but to accept the reality that Dow is on its major wave 9 since January 2019 despite the unexplainable fact that wave C has only 3 waves instead of 5.

But I believe many people will be very happy that Dow is on its major wave 9 heading towards 34,000 and beyond. Who know the mega wave VII might have more that nine major waves.

Insas Bhd (Rm0.885)

Insas confirmed that minor wave iii has started. From the weekly chart, it has formed the first candlestick of minor wave iii. Hopefully by end of December it can complete its sub-wave iii at around Rm1.06 or higher before the sub-wave iv correction.