tag:blogger.com,1999:blog-27990769.comments2023-03-17T02:49:06.807-07:00VALUE INVESTOR HAVENLucas Limhttp://www.blogger.com/profile/14964957975149165060noreply@blogger.comBlogger24125tag:blogger.com,1999:blog-27990769.post-24884883606754199652008-11-17T20:32:00.000-08:002008-11-17T20:32:00.000-08:00Hi Joan,It can mean that:1. Insider purchases it a...Hi Joan,<BR/><BR/>It can mean that:<BR/>1. Insider purchases it at a discount to par value<BR/> OR<BR/>2. Insider purchases it at discount to common stock value<BR/><BR/>OR <BR/>3. Discount to intrinsic value<BR/><BR/>Insiders only buy for one reason and that is to make money.<BR/><BR/>In this case, check if Interest and Preferred dividend coverage ratio is healthy... at least 3 times. Test this ratio against recessionary earnings and see if it is healthy<BR/><BR/>It will be good if company has net cash. (Total cash and cash equivalents - total debt)<BR/><BR/>Generally debt is a prededent to Preferred stock which is a precedent to Common Stock when company files bankruptcy.<BR/><BR/>If the company can sufficiently pays its interest payments and there are no short term maturing debt which they cannot handle and there is a net cash balance and it can further pay its preferred dividends against the backdrop of recessionary revenue and earnings and the preferred is undervalued with a high yield, then it would make sense that what the insider is doing is correct and by correct i mean buying of undervalued security.<BR/><BR/>Best regards,<BR/>LucasLucas Limhttps://www.blogger.com/profile/14964957975149165060noreply@blogger.comtag:blogger.com,1999:blog-27990769.post-61660274512507681962008-11-13T08:47:00.000-08:002008-11-13T08:47:00.000-08:00Can you help with a similar question? What does i...Can you help with a similar question? What does it mean if an insider purchases preferred stock at a discount?Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-27990769.post-51169911154709303902008-11-10T07:10:00.000-08:002008-11-10T07:10:00.000-08:00Good post.Good post.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-27990769.post-44896060409214109822008-10-05T23:54:00.000-07:002008-10-05T23:54:00.000-07:00Dear friends,Thanks you all for your comments. The...Dear friends,<BR/><BR/>Thanks you all for your comments. They lift my spirits. After all blogging is about sharing. Thank you for sharing your thoughts with me and continue to do so.<BR/><BR/>Best regards,<BR/>LucasLucas Limhttps://www.blogger.com/profile/14964957975149165060noreply@blogger.comtag:blogger.com,1999:blog-27990769.post-74919680897782464612008-10-05T13:05:00.000-07:002008-10-05T13:05:00.000-07:00Thanks for submitting this post to the Festival of...Thanks for submitting this post to the Festival of Stocks. You did a good job explaining the risks associated with this penny stock. I agree that its best to wait and see if there will be a catalyst with a stock like this. By the way, I just subscribed to your feed.Georgehttps://www.blogger.com/profile/13592313908014923842noreply@blogger.comtag:blogger.com,1999:blog-27990769.post-1585614975484106142008-10-02T19:28:00.000-07:002008-10-02T19:28:00.000-07:00Great Post,I love reading your blog. I'm actually ...Great Post,<BR/><BR/>I love reading your blog. I'm actually in the process of analyzing the company myself. Wish you the best. If you get a chance check out my value investing website, I would love to hear your insight. www.simoleonsense.comAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-27990769.post-45512924894858073082008-09-17T17:31:00.000-07:002008-09-17T17:31:00.000-07:00Read Joel Greenblatt's book on how to be rich not ...Read Joel Greenblatt's book on how to be rich not trying too hard.<BR/><BR/>But first, i would like to you to examine your thought process. Do you love investing? Find something that you love to do and you will be tap dancing doing it in Buffet's words. If not what you will be subjected to is a "super reaction to deprival syndrome" Bias as classified by Charles T Munger. I hope i got the clasification correct :)<BR/><BR/>If investing is what you like to do, you can put your money into a High Return on capital, high earnings yield and low price to book portfolio. Once again, go read Joel Greenblatt's book on the Magic formula.<BR/><BR/>How much to start off depends on how much you have in your pockets.If you are young, i assume you can take more risk and put a greater portion of your net worth in you portfolio.<BR/><BR/>Best regards,<BR/>LucasLucas Limhttps://www.blogger.com/profile/14964957975149165060noreply@blogger.comtag:blogger.com,1999:blog-27990769.post-62744461269154232352008-09-14T09:13:00.000-07:002008-09-14T09:13:00.000-07:00Hi Sechai, you can email me at king_luke35@yahoo.c...Hi Sechai, you can email me at king_luke35@yahoo.com or valueinvestorhaven@gmail.com valueinvestorhaven is actually chaired by Manpreet and me and it great to know that there are hard core folks like you in Singapore who believe in value investing. Very few of us out there pal.:) You are a rare breed.<BR/><BR/>Better and better,<BR/>LucasLucas Limhttps://www.blogger.com/profile/14964957975149165060noreply@blogger.comtag:blogger.com,1999:blog-27990769.post-35278091945454037852008-09-14T09:05:00.000-07:002008-09-14T09:05:00.000-07:00Hi Sechai,Thanks for your comments. They are well ...Hi Sechai,<BR/><BR/>Thanks for your comments. They are well appreciated. Do continue posting me any comments or questions that you may have.<BR/><BR/>Best regards,<BR/>LucasLucas Limhttps://www.blogger.com/profile/14964957975149165060noreply@blogger.comtag:blogger.com,1999:blog-27990769.post-9840844443279361962008-09-13T02:32:00.000-07:002008-09-13T02:32:00.000-07:00Ya, you are right no one know when is the market p...Ya, you are right no one know when is the market peak, but you can feel it. <BR/>Eg. When you see your downstairs coffee shop's people discussing excitedly about stocks.. <BR/>(Just kidding)Sechaihttps://www.blogger.com/profile/01683854748089332401noreply@blogger.comtag:blogger.com,1999:blog-27990769.post-48479150869907610532008-09-10T08:35:00.000-07:002008-09-10T08:35:00.000-07:00Dear Lucas,For your info, I am reading Security An...Dear Lucas,<BR/><BR/>For your info, I am reading Security Analysis, the 1951 Edition, finishing soon. I understand that Buffett and Graham's approaches have significant differences.<BR/><BR/>Both DCF and Price to FCF are getting popular. I remembered Jeremy Siegel once said in his Stocks for the Long Run, (I only remember the idea)<BR/>' When everyone starts to qpply the same methods, then the previous merits of that methods will never reappear.'<BR/><BR/>So, we got to be careful if we are going to use this.<BR/><BR/>I understand that assessing intrinsic value requires years of efforts, but i am willing to do it.<BR/><BR/>With recent bear market, i can identify a few companies which fall under the NET-NET approach. (quite happy with that)<BR/><BR/>Thanks a lot.<BR/><BR/>Mind to give me your email ?<BR/><BR/>Se ChaiSechaihttps://www.blogger.com/profile/01683854748089332401noreply@blogger.comtag:blogger.com,1999:blog-27990769.post-92136472010459011432008-09-08T01:55:00.000-07:002008-09-08T01:55:00.000-07:00Hi Sechai, First of all thanks for your comments t...Hi Sechai,<BR/> <BR/>First of all thanks for your comments there buddy. <BR/> <BR/>Well you have got a point there by saying that dollar cost averaging is not something divine, especially when you buy into junk companies. A lot of these companies never see daylight again. That article was written with the idea of enlightening some of my clients and readers about the financial industry. As far as i am concerned, if one was an amateur investor, i would advise one to invest in an index funds where the front end sales charges are lower and to stay away from stocks. Hence to make myself clear dollar cost averaging should apply to index funds/unit trusts/mutual funds and also to particular stocks if one knows how to read the fundamentals of a company and has got at least some sense of a portfolio strategy.<BR/> <BR/>You also do have a point on trying to invest in peaks. But the thing is no one really knows when peaks occur hence dollar cost averaging will still help one to reduce average cost per investment unit.<BR/> <BR/>Thanks for your comments<BR/><BR/>Best regards,<BR/>LucasLucas Limhttps://www.blogger.com/profile/14964957975149165060noreply@blogger.comtag:blogger.com,1999:blog-27990769.post-13519039267548871672008-09-08T01:52:00.000-07:002008-09-08T01:52:00.000-07:00Dear Sechai, You have to remember that Graham and ...Dear Sechai,<BR/> <BR/>You have to remember that Graham and Buffet approaches are different in a sense that might shock you. If you do read security analysis, it might surprise you that what Graham was trying to teach us was not how to value companies but how to identify statiscally cheap companies that generally do well as a portfolio. Now, you don't have to know how to value a company when you are a security analyst and your main job is to be able to find cheap companies according to Graham and he gave examples such as debt capacity bargains etc. You can still find such companies although they are limited. And the premise is that you can have great things happen to cheap companies because of information assymetry. With regards to modifying the approach, i am still undecided as to how best the approach should be modified. You can probably spare me a few pointers from there.<BR/> <BR/>Buffet evolved and he is saying instead of just buying "cigar butts", let's buy a great companies with great managements at reasonable prices and hence the need to value and he felt the need to do so because he had such large sums of money to invest in and Ben Graham type of stocks were often too illiquid to invest in. He had constraints that probably most people, like me and some ordinary folk did'nt have. But so often, assessing intrinsic value is probably a very tough thing to do and Buffet does it so well that it is so hard to replicate. By all means, if you were confident of your ability to estimate intrinsic value through discounted cash flow, go ahead and do it but i really do not think that people in general are up to it. It takes years of research and building up your circle of competence to do so.<BR/> <BR/>One quick and dirty way though is to look at it from a standpoint of a price to free cash flow metric. Never pay more than 7-8 x free cash flow excluding excess capital. But again, this is subjective and open to debate.<BR/> <BR/>Best regards,<BR/>LucasLucas Limhttps://www.blogger.com/profile/14964957975149165060noreply@blogger.comtag:blogger.com,1999:blog-27990769.post-17202070949226675282008-09-08T01:49:00.000-07:002008-09-08T01:49:00.000-07:00This comment has been removed by the author.Lucas Limhttps://www.blogger.com/profile/14964957975149165060noreply@blogger.comtag:blogger.com,1999:blog-27990769.post-71374308619624267052008-08-31T08:03:00.000-07:002008-08-31T08:03:00.000-07:00Dear Lucas,Thanks for your good example regarding ...Dear Lucas,<BR/><BR/>Thanks for your good example regarding the financial industry.<BR/><BR/>Dollar-cost-averaging is a great advantage of average investor in current bear market. However, investor should understand that dollar cost averaging is not something divine, if the investor invest in stocks of junk companies... As what Buffett suggest to all of us, normal investor should invest in index fund. <BR/><BR/>One more thing to take note, avoiding invest at the market peak, it will lead to a permanent loss and diminish the usefulness of Dollar cost averaging. Although we are not able to time the market, but we ought to be fearful when the whole market becomes greedy and crazy.Sechaihttps://www.blogger.com/profile/01683854748089332401noreply@blogger.comtag:blogger.com,1999:blog-27990769.post-76584120255175511522008-08-31T07:40:00.000-07:002008-08-31T07:40:00.000-07:00Dear Lucas,You are right, we should not try to tim...Dear Lucas,<BR/><BR/>You are right, we should not try to time the market and nobody does have the ability.<BR/><BR/>The application of Graham's approach is suitable in this situation. However, the approach needs to be modified a bit by recognising fewer stocks nowadays meet that strict criteria. We should also assess the approximate value of the business, most probably through discounted cash flow basis and some facts. Some companies are cheap and worth to buy, some companies are cheap for good reasons.<BR/><BR/>Welcome back and thank you for your sharing.Sechaihttps://www.blogger.com/profile/01683854748089332401noreply@blogger.comtag:blogger.com,1999:blog-27990769.post-61155198462659287412008-03-08T07:52:00.000-08:002008-03-08T07:52:00.000-08:00How can i become a millionaire,and how much should...How can i become a millionaire,and how much should i start off with going into the stock world.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-27990769.post-88652697027587573892007-10-17T06:47:00.000-07:002007-10-17T06:47:00.000-07:00I agree.http://valuevista.blogspot.com/2007/09/hnr...I agree.<BR/><BR/>http://valuevista.blogspot.com/2007/09/hnr-update.html<BR/><BR/>http://valuevista.blogspot.com/2007/06/hnr-is-oil-gas-company.htmlLloyd Blankfeinhttps://www.blogger.com/profile/02348928984174801762noreply@blogger.comtag:blogger.com,1999:blog-27990769.post-972192090299981512007-07-10T07:31:00.000-07:002007-07-10T07:31:00.000-07:00http://www.thevaluecircle.comasia's top value inve...http://www.thevaluecircle.com<BR/><BR/>asia's top value investorsAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-27990769.post-20373968461640318122007-06-09T21:37:00.000-07:002007-06-09T21:37:00.000-07:00Warren's answer was firm and quick. He said that i...<I>Warren's answer was firm and quick. He said that if he was managing smaller sums of money, he would be investing in companies with a net cash balance. </I><BR/><BR/>Where did you see/hear this recent comment? Thanks.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-27990769.post-9830505902994378172007-06-01T16:42:00.000-07:002007-06-01T16:42:00.000-07:00It might be better to just cover what you thought ...It might be better to just cover what you thought were salient points rather than just copy and paste the whole speech. Just provide a link to it instead. <BR/><BR/>On another note, check out Nygren's <A HREF="http://www.oakmark.com/reports/2007_q2/comment1.htm" REL="nofollow">quarterly commentary</A> on his funds' performanceAdityahttps://www.blogger.com/profile/16688332585004423163noreply@blogger.comtag:blogger.com,1999:blog-27990769.post-44083390398061529922007-03-08T13:07:00.000-08:002007-03-08T13:07:00.000-08:00Its not Hotung is it?Its not Hotung is it?ROIIChttps://www.blogger.com/profile/17573824242596886943noreply@blogger.comtag:blogger.com,1999:blog-27990769.post-16059419457459672882007-03-08T12:49:00.000-08:002007-03-08T12:49:00.000-08:00Its been accepted by mgt, not shareholders. Shareh...Its been accepted by mgt, not shareholders. Shareholders will be voting their proxy and since stock price has consistently traded above $36, those who want out will sell in the open mkt. Hence, its unlikely Icahn will be able to steal the company from minorities.ROIIChttps://www.blogger.com/profile/17573824242596886943noreply@blogger.comtag:blogger.com,1999:blog-27990769.post-1148432674890680722006-05-23T18:04:00.000-07:002006-05-23T18:04:00.000-07:00yeh we need to find our own 100 bagger!yeh we need to find our own 100 bagger!magenpiehttps://www.blogger.com/profile/07399447674738276869noreply@blogger.com