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Sri Lanka Equity Forum » කොටස් වෙළඳපොළේ කතා » comb, spen buy??

comb, spen buy??

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1 comb, spen buy?? on Sun Jul 08, 2018 5:37 pm

anushka25

avatar
Stock Trader
comb, spen දැන් තියෙනෙ 52 week low නිසා buy කරන්න සුදුසුද?  Rolling Eyes Rolling Eyes Rolling Eyes Rolling Eyes

2 Re: comb, spen buy?? on Wed Jul 11, 2018 4:45 pm

DS Wijesinghe


Senior Manager - Equity Analytics
Senior Manager - Equity Analytics
@anushka25 wrote:comb, spen දැන් තියෙනෙ 52 week low නිසා buy කරන්න සුදුසුද?  Rolling Eyes Rolling Eyes Rolling Eyes Rolling Eyes
Anushka, buying any stock @ 52 week lowest should be avoided at all times when investing in stocks. Investors who bought COMB, SPEN, LLUB during the last 3 1/2 years based on this misguided theory have learned the bitter reality. There are so many other similar stocks. 

I have been following SPEN for some time and bought a smaller quantity @ 50/-  eventhough it doesn't satisfy my full criteria. Its dissapopinting to note that their Annual Rate of Return on Capital is well below 10% and there is virtually no growth in Dividends.

Also I will buy a further quantity if it comes down to 45./- as the company's renewal of agreements with CEB will drive topline and bottomline both in the next 3 years.


Below is a post I have shared earlier as well in this forum to reiterate among medium-long term fellow forum member on some of the basic tools used by worlds highly successful investors who earn pretty decently even in bear markets. They are cardinal rules adopted by all time highly successful investors. 

The rule is, always invest with Certainty as Investing is not Gambling. Always invest in a company from an industry that you understand and like. You need to love the business of the company you invest in. For example If you don't like drinking and Smoking on principle, don't invest in companies operating in those industries, like Distilleries, Breweries and Tobacco. .Also If you really don't understand what the business is all about, then you're gambling on them. Remember INVESTING IS NOT GAMBLING.

After you had figured out that you love the industry and the company, look at Return on Investment Capital (ROIC), sales, profitability, Earnings per share(EPS), Net Asset Value Per Share(NAVPS), annual dividend for a least 5 years.(preferably for 8 years). Compounded annual growth rates of these performance yardsticks need to be a minimum of 10% per annum during the 5 or 8 year period you are reviewing. The other measures are Net Cashflows and the Current Asset:Current Liability ratio. If the performances are not consistent with visible swings up and down, don't even bother to touch the company you are researching.

Before you invest in any business pay close attention to the people who run it. Do it even after you've invested in that business. Is the CEO a honest and a great leader? He/she HAS to be Shareholder driven and one who will have great ambition to take the company to greater heights.

If the management team doesn't have talent or integrity, they'll run the business into the ground and you'll be in danger of losing your capital. Therefore please carefully research the CEO and his track record.

Read very carefully the CEOs message to the shareholders in the Annual Reports and quarterly reports. A good CEO would always make an effort to explain in a way that everyone can easily understand. If you are confused as to what the CEO is trying to tell the shareholders, it could be that the management is intentionally misleading and the company might be in trouble.

Above are few of the tips (amongst many more they look at before buyingI have learned from some of the all time highly successful investors who beat the market annually, whether it is BULL or BEAR.

If you stick to these cardinal rules you will earn a return on your investment beating Bank FD rates even perhaps during Bear periods. CSE is going through a very rough Bear market patch from Jan 2015 to-date and we need to ensure our investments are safe and secure even during hard and difficult times like these..

3 Great one DS on Wed Jul 11, 2018 6:59 pm

ruwan326

avatar
Senior Vice President - Equity Analytics
Senior Vice President - Equity Analytics
@DS Wijesinghe wrote:
@anushka25 wrote:comb, spen දැන් තියෙනෙ 52 week low නිසා buy කරන්න සුදුසුද?  Rolling Eyes Rolling Eyes Rolling Eyes Rolling Eyes
Anushka, buying any stock @ 52 week lowest should be avoided at all times when investing in stocks. Investors who bought COMB, SPEN, LLUB during the last 3 1/2 years based on this misguided theory have learned the bitter reality. There are so many other similar stocks. 

I have been following SPEN for some time and bought a smaller quantity @ 50/-  eventhough it doesn't satisfy my full criteria. Its dissapopinting to note that their Annual Rate of Return on Capital is well below 10% and there is virtually no growth in Dividends.

Also I will buy a further quantity if it comes down to 45./- as the company's renewal of agreements with CEB will drive topline and bottomline both in the next 3 years.


Below is a post I have shared earlier as well in this forum to reiterate among medium-long term fellow forum member on some of the basic tools used by worlds highly successful investors who earn pretty decently even in bear markets. They are cardinal rules adopted by all time highly successful investors. 

The rule is, always invest with Certainty as Investing is not Gambling. Always invest in a company from an industry that you understand and like. You need to love the business of the company you invest in. For example If you don't like drinking and Smoking on principle, don't invest in companies operating in those industries, like Distilleries, Breweries and Tobacco. .Also If you really don't understand what the business is all about, then you're gambling on them. Remember INVESTING IS NOT GAMBLING.

After you had figured out that you love the industry and the company, look at Return on Investment Capital (ROIC), sales, profitability, Earnings per share(EPS), Net Asset Value Per Share(NAVPS), annual dividend for a least 5 years.(preferably for 8 years). Compounded annual growth rates of these performance yardsticks need to be a minimum of 10% per annum during the 5 or 8 year period you are reviewing. The other measures are Net Cashflows and the Current Asset:Current Liability ratio. If the performances are not consistent with visible swings up and down, don't even bother to touch the company you are researching.

Before you invest in any business pay close attention to the people who run it. Do it even after you've invested in that business. Is the CEO a honest and a great leader? He/she HAS to be Shareholder driven and one who will have great ambition to take the company to greater heights.

If the management team doesn't have talent or integrity, they'll run the business into the ground and you'll be in danger of losing your capital. Therefore please carefully research the CEO and his track record.

Read very carefully the CEOs message to the shareholders in the Annual Reports and quarterly reports. A good CEO would always make an effort to explain in a way that everyone can easily understand. If you are confused as to what the CEO is trying to tell the shareholders, it could be that the management is intentionally misleading and the company might be in trouble.

Above are few of the tips (amongst many more they look at before buyingI have learned from some of the all time highly successful investors who beat the market annually, whether it is BULL or BEAR.

If you stick to these cardinal rules you will earn a return on your investment beating Bank FD rates even perhaps during Bear periods. CSE is going through a very rough Bear market patch from Jan 2015 to-date and we need to ensure our investments are safe and secure even during hard and difficult times like these..
every one need to do their own analysis before picking a share. If I have time I will start a new topic How to pick a share:roll: Rolling Eyes
A.52weeks low is not the only option to buy Idea 
B.52weeks high is not the only option to buy too Idea

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