【UCHITEC 交流专区】 很好奇的问问：关于 UCHITEC

留下眼镜

最近的涨潮半真半假，似乎是真投资，又像是玩contra。我放了，宁愿赚少一点。

要赚股息，目前看来看去似乎也只有这股，很多人都集中来这个counter玩。

Mr.Business

博客文章。



Monday, February 27, 2006
ROI on Uchi

ROI - the Review of Investment

So you have purchased yourself an investment in a great business at a good price. So what do you do?

Do you honestly think it is wise to leave your great investment aside and hope that your investment will grow forever and ever?

Get real!

That's the harsh answer I keep reminding myself. For in the real businessworld, most businesses simply cannot grow forever and ever. Leaving our investment aside and hope that our investment(s) will grow into a 10 or 20-bagger is simply foolish thinking.

Remember we are but normal average investors. And because we are normal average investors, we are more likely to make mistakes, either via faults in our own stock selection process or the company that we have vested interests, might not be a good company anymore! And if it is no longer a good company, why hold on to the investment?

Which is why the ROI is so important. We need to review our investment to make sure that the stocks we are holding is still a good stock. We need to review if the very reasons to invest in the stock remains valid. Now if the stock is no longer good, it simply makes no sense to hold the stock.

Ah, yes talk is always very cheap because supply is always greater than demand. (LOL!)

Ok.. let me share a mumbling on a real example.

Let's assume (forget this not, the word assume (ass-u-me) means making an ass out of u and me.. :p) that I had made an investment in Uchi Tech. Remember hor... ass-u-me I had made an investment in Uchi.

Now say one of the reasonings that I purchased Uchi was for its earnings growth. Yup, say i was seduced by the fact Uchi is making lots of money and is going to make more money in the future. And because of this reason, I made an investment in this stock.

So for my personal ROI, I really need to ask myself honestly how valid is this reasoning now?

Do you see how I have stressed on the word honestly? Sounds silly right? But as silly as it may sound, many an investor have failed to this question themselves truthfully!

Back to Uchi. To answer this question, i would look at Uchi's historical yearly earnings. (please verify the data posted here.)

fy_______ Sales______Net Profit
1999_____51.532____19.949
2000_____66.022____23.170
2001 ____ 94.999____37.062
2002_____118.847___49.479
2003_____120.659___58.571
2004_____115.352___62.759
2005_____131.884___73.578

Question time. From 1999 to 2005, has Uchi earnings continued to grow? Are you satisfied with it?

Next issue. Take out the good old calculator and calculate the net profit margins. Are you satisfied with the net profit margins? Has the margins been sacrificed for the sake of earnings growth? (ah.. this one is debatable. For some, they do not like to see net profit margins been sacrificed for the sake of growth.)

Net profit margin since 1999: 39%, 35%, 39%, 42%, 49%, 54%, 56%

How do you rate such a performance? Still good?

Next, check on the company's balance sheet. Take it as a challenge. Ass-u-me that you are on a mission to discover the biggest .. err... err... investment trap in the Bursa Malaysia. Comb thru Uchi's balance sheet and see if you can smell a rat in there!

Things to ask.. is there a drastic built-up in the company's inventory? What about the trade balances? And what about the company's borrowings?

Do we smell a rat?

And the most important thing is the Moola!

Show Me Ze Moola!

Simple issue. The company announced that it made more and more money each year. Do we see the 'wealth' being created or not? Is the company really worth more or is the simply company worth less?

Big issue here.. for we have seen so many companies saying they earn so much money.. but... somehow... the investor, they dun see the moola!

Compare the cash balances. Is the current piggy bank more than last year fiscal year? If no, where is ze moola? Did the company pay out more dividends?

How? Are we satisfied? Or am i singing Mick Jagger's classic, I can't get no Satisfaction, already?

Remember in ROI, there is no point in cheating. If we cheat ourselves, meaning if we give ourselves lame excuses and find flimsy excuses to justify our own reasonings to stay invested in the stock, we are simply cheating ourselves and we are only helping the share market make a fool out of our beloved money!

How? Does Uchi past all these simple issues or not?

Are we satisfied that Uchi has a realistic chance to grow somemore in the near future?


And then check the local corporate issues... do we see the company doing anything funky?

Remember in the posting, Management Integrity,

According to Fisher, the management of a company is always for closer to its assets than its shareholders. And without even breaking any laws, there are number of ways that the management can benefit themselves and their families at the expense of the minority shareholders, for example employing their relatives, buy-and-selling of properties between relatives at above market rates or the issuing common stock options.
I saw this Uchi announcement posted...

How? Uchi is proposing a new ESOS.

Ahem. A 15% ESOS priced at a "price to be determined by the Board upon recommendation of the ESOS Committee based on the weighted average market price of the Shares for the five (5) market days immediately preceding the date of offer with a discount of not more than ten percent (10%) or such other percentage of discount as may be permitted by the Bursa Securities or any other relevant authorities from time to time during the duration of the Proposed New ESOS; or.."

how? If and when this new proposal is passed, a minority shareholder will see their earnings per share being diluted by 15%.

Is this fair? Is this acceptable by you?

If no... then the option is to either vote against this proposal ... and if that fails... then perhaps... yes perhaps it is time to say goodbye to the stock! Remember Fisher teaching that in such instances, the company is finding ways to enrich and benefit themselves at the expense of you, the minority shareholder!

Again how?

Well, these are the very issues I will be addressing myself, if and if I own shares in this stock, Uchi Tech.

ps... I am merely mumbling my thoughts... ok?

Cheers dude!

http://whereiszemoola.blogspot.com/2006/02/roi-on-uchi.html

Mr.Business

博客文章。

Monday, February 27, 2006
ROI on Uchi: Part II

Regarding the growth issue for Uchi, yes, i have explained it rather in a simplistic manner.

Some folks actually use a more complex (and since it is more complex, it is pretty subjective... LOL.... and more confusing!) measuring such as the CAGR yardstick or the Compounded Annual Growth Rate.

Why is it complex and subjective?

Well.... let me say this... a company's compounded annual growth varies and each starting point of reference will yield a different interpretation.... err... complicated, eh?

For example... take the computation of Uchi's CAGR since 1999. Net profit then was 19 mil. For fy 2005, Uchi's net profit is now 73.578 million. Number of years = 6. Using one of them business calculators (simple lor - no need complexity), with a couple of clicks here and there, we get Uchi's CAGR since 1999 = 25%. Awesome, eh?

Now if say we take the computation of Uchi's CAGR since 2001. Uchi's net profit in 2001 was 37 million. Uchi's net proft in 2004 was 63 million. Number of years = 4. So Uchi's CAGR since 2001 = 18.76%. Err...not as awesome as since 1999. Can we interpret it and say that the last 4 years, Uchi's profit growth was not as strong?

And of course if we do a y-o-y comparison... Uchi's net profit in 2003 was 59 million. So Uchi's net profit only 'growed' 7% in fy 2004. And for current fiscal year, fy 2005, Uchi's net profits grew 17%.

Which is why i say this growth and the CAGR is pretty subjective. Depending on the starting point of reference, each year will likely to yield a different CAGR.

Ahhh.... the complexity in using numbers and yardsticks.... !!!!!!

Anywayyyyyy..... from a business perspective.... what's our most important evaluation/assessment of Uchi's growth? How are we going to review such a performance?

Again... this is where it gets subjective.....

For me... i would say that Uchi has a business which showed an impressive growth over the last 6 years. However, the last couple of years, as in the laws of growth (ie nothing can grow at a robust rate forever), Uchi's growth has slowed. However, the biggest plus is the strong and impressive improvement in Uchi's net profit margins. This would suggest to me that the management is making an effort to increase profit to overcome the slower growth in its business. This would be my assessment... which of course is very subjective on this part....

what about urs?

Does it pass or fail to meet your assessment that Uchi remains a good business investment? ie... do we STILL want to own and be a partner in such a business?

Ok.. let me flip this around... and use a trader's perspective on this matter. Now I am very lucky that this terror trader dude Liam was willing to share this comments with me before. :p (So I hope he won't mind me sharing his comments here... :p)



Altho' earnings growth has peaked and no more returning 12% per annum BUT financials and margins are still great, is there a problem?
Wouldnt it come a time when every biz would have to go thru a consolidation cycle? The fact that growth has slowed but if amply compensated by higher revenue translating into better financials, isnt it a stock worth holding?
An analogy from a trader's perspective, after a spike in price, a stock usually consolidates at a certain range - this is a price range where an equilibrium of buyers and sellers can agree to trade. Now, the next phase of movement will then be dictated by whether the buying or selling is greater than the other and u then take appropriate action.
Do i sell into a consolidation? No, I dont. Any similarities here?
How?

Some MORE issues to consider eh?

Cheers!

http://whereiszemoola.blogspot.c ... n-uchi-part-ii.html

Mr.Business

博客文章。

Tuesday, February 28, 2006
ROI on Uchi: Part III - the ESOS issue

It would appear that we have a very interesting situation in Uchi Tech.

We are looking at a stock...


With a CAGR of 25% over the last 6 years.
With a CAGR of 18.76% over the last 4 years.
Last year's net profits grew 17%
Net profit margins of 56%.
Nett cash. No debts

But it is considering a tacky 15% ESOS!!

As mentioned by the great, late Philip Fisher:


the management of a company is always for closer to its assets than its shareholders. And without even breaking any laws, there are number of ways that the  can benefit themselves and their families at the expense of the minority shareholders, for example employing their relatives, buy-and-selling of properties between relatives at above market rates or the issuing common stock options.

Yes, by issuing a 15% ESOS, the directors of the company are putting themselves in a position where they benefit themselves more than the minority shareholder.

Now here is some interesting issue worth considering. Here's what we need to do. Open the wordfile attached to that ESOS announcement

1. See line 3. Maximum no. of Shares to be issued pursuant to the exercise of outstanding Existing ESOS options granted/ which may be granted. Total? 23,445,280 million shares.

Question that begs to be asked. Why is there so many outstanding existing ESOS?
Since there already exist so many outstanding ESOS, why the need for another 15%?

2. See line 5.
To be issued pursuant to the Proposed New ESOS (up to 15%)... 59,375,712.

Now if you add both figures up, you will get 82,820,992 new shares, assuming full exercise of ESOS.

Currently Uchi has 372,392,800 shares. Which means there is a possible dilution in earnings per share of 22% assuming full exercise of all these ESOS.

Now let's be realistic and ask ourselves this... is 22% dilution in earnings per share a lot or not?

Simple way to look at this dilution.

Say U** has a current eps of 100 sen.
Say U** has a possibility to trade at a price earnings multiple of 18x.

Which means U** could be worth some 18.00 in market price.

Now a 22% dilution means... the eps would be 78 sen.
And using the same pe multiple assumption of 18x, U** should be trading at a market price of 14.00.

See how disadvantage to the minority shareholder?

Oh yes, it is mentioned that ESOS is important for a company for it is a proven method to retain talent in a company. No doubt about it. But from a minority shareholder of the company oint of view, do you think it is fair that your earnings per share be diluted by so much?

Now comes the really subjective and tricky part of any review.

Say you really, really hate such a proposal but on the other hand you recognise that this is still a very solid company. How?

Would you forgive Uchi on this and consider this as just one red flag? Are you willing to forgive UCHi and consider this as only just one naughty thingy?

Or would you kick Uchi out of the door?

How?

Oh this issue of flags... LOL... sometimes... I wonder if investing is a game of collecting flags? Like in soccer, you get a yellow card and then a red card! Ahhh.. but do not get me wrong here.. me just ranting on it that's all... lol... just poking fun lah..... :p

Anyhow... at the end of the day... it matters not what I think about ESOS or what I think about UCHi... most important is us making the correct rational decision.

just for the record... Uchi is now trading at 3.30.

http://whereiszemoola.blogspot.c ... iii-esos-issue.html

Mr.Business

请问各位Kawan Uchitec，

Uchitec的profit margin这么高，可有任何竞争者呢？她的竞争力在哪里？

stereo

我翻回以前在网上print出来的一些资料，看到这样的一篇报道，不知道是什么。这会不会是uchitec的优势？

1－6－2007
集团的2子公司将继续享有由国际贸易及工业部颁发新兴工业地位的特权至2008－12－31。上述特权包括有根据应用与系统综合来设计，发展与制造微处理器;以及设计,发展与设计控制模具，以供工业消费电子产品所用的零件。

Mr.Business

没有研究Uchitec，所以只是顺便讲讲。Uchitec是由她的老板两兄弟白手起家的，有竞争优势，会不会有一天又有别人开公司来抢Uchitec的生意。

另外，我以为Uchitec过于依靠大客户，而且产品属于奢侈品，会受经济循环的影响。Uchitec超过90％的产品出口去英国（报纸写的），是不是太依靠英国的市场？

不知Kawan Uchitec如何看？

vincentphuah

Uchitec 有大量的现金喔!
除了现金110万以外,它还有short term deposit约一亿六千万...相信明年的现金还会更多,因为ringgit升值了...

stereo

为什么说ringgit升值现金会多？？

vincentphuah

喔,错了,应该说升值了,这笔钱的用处就更广了...
可是他们为什么不拿去投资其它,放在银行2007 1月至2008 1月只有3.15-4.10%的dividen...今年有500多万的利息呢!

stereo

所以share buy back好过，因为自家的利息都高过银行两倍，等于放3年的利息。

Shiyo

I sold it at RM2.30 loh since i bought 500,000 at RM1.75...
Altough this month sound the market going up, but do you all ever feel weird about ASIA and EUROPE countries never be impacted by US...most of people said that ASIA can be independent from US..I personally agree but not now..
My conclusion is the bad result and recession fact from EUROPE will be presented soon...My dear friend..take your time and watch out in this coming JUNE and JULY (2nd quarter result)..
Sell all your share now..Pick up from year end.. Good luck

风起云涌

原帖由 Shiyo 于 20-4-2008 11:44 PM 发表
I sold it at RM2.30 loh since i bought 500,000 at RM1.75...
Altough this month sound the market going up, but do you all ever feel weird about ASIA and EUROPE countries never be impacted by US...most ...

请大家使用中文发表文章，没输入法者可使用本站提供的网上输入法。
目前论坛已內置中文输入法，大家可轻松输入中文。
使用网上输入法发表新帖：简体英中、简体拼音、简繁拼音、简体仓颉、简繁仓颉使用网上输入法回复帖子：简体英中、简体拼音、简繁拼音、简体仓颉、简繁仓颉

stereo

在新加坡“捞”电子厂的朋友，很多开始没工开。

Mr.Business

这么严重？你的意思是工厂停工？

stereo

不完全停工，只是减少生产量。现在员工的情况是轮流休息一个月。有排“瘫”。

Mr.Business

可怜。。。

king1892

手握豐沛現金的Uchitec又來派錢了。

Ex-date：6月26日。

6sen和4sen的免稅股息。

以今天閉市價格RM2.24來說，等同讓股東獲得4.46%的利息。

vincentphuah

2007的年报显示,uchitec的cash少了,inventories少了,eps少了,nta少了,dividen也少了

stanleymyc

怎么这么有水。。。