Bought back Tenaga at RM6.80 today. Though, this is not my ideal purchase price but at current price, i think is worth buying in some while waiting for next level of purchase at around RM6 to RM6.50 if it does drop to this range. I must admit that buying this type of stock at current PE is quite a save bet even though it can trade lower but the risk is significantly reduce. One can adopt averaging downward strategy from this level or one can opt to wait further. As i said before, no one can predict future, if one claims that he can know the up and down before hand, then he/she must be God and he/she must have some super natural power beyond human being. No one can buy lowest nor sell the highest, we know that this is the fact of trading. One can only make assumptions like buying when PE is low (a very safe strategy but not necessary guaranty return but at least mitigate risk) or buying when it produce good earning and have good prospect of future earnings or buying when everyone is buying during super bull. Whatever method you adopt, try use the method that always produce you result. In my case, i played dividend stocks, of course pick the good one like PBBANK, MAYBULK, GUINNESS, CARLSBERG, PANAMY, BJTOTO and etc... but when to pick it, is the key and important area one must exercise cleverly. First set your buying conditions and what will that be ?? I think up to individual preferences, i buy when PE reasonably low in bearish or crash market, i buy when there is good earning and sustainable future earning, i buy when dividend payout is good and better than FD rate, i buy when trend is allow me to do so. In this case Tenaga happen to fall in my conditions. Till then, happy trading & may the best price be yours.
4 comments:
Horse,
i hv much admire & respect your stock investment thinking abt the long haul view & dividend stocks play....but is Tenaga is good investment now ? with issued like high coal cost, IPP re-negotiation, weak management, as well as recent political/inflation pressure that what make so sure that it can continue pay out those high dividend like last year !?
hi anonymous,
certainly Tenaga having lots of issues, it can drift lower even with current price but with the PE of around 7+, i think the risk has been significantly mitigated. What i adopt here is to average downward if it happen to drift lower. One like you may ask why buying when so many problem ?? let me ask u, will Tenaga go insolvancy with these kind of problems ?? the answer is definitely not. Tenaga may not sustain to pay good dividend like last year but it definitely will pay dividend on every 2nd and 4th quater, i would predict is about 20sen per annual that representing around 3% with current price but think longterm when price appreciate which i believe the fair value is around 9.5 conservatively in which i've discounted with expected lower future earning. Look around all the bluechips in the market, all are rather expensive, except for Tenaga which can give you a higher probability and +ve hope. U can opt to purchase this guy when it dip further to RM6 which i think is a possible range to touch. The key thing is hold it long u will definitely on the right trach to make money. Being patient is the key thing here, i only hope for price appreciation n dividend is the extra bonus for me with Tenaga. Judge yourself see whether u reap what u sow. I have high hope with this guy, maybe not for now but longterm.....
Hi horse,
thks for your prompt input & clear analysis, i'd keep observing this beaten down stk, what u said make very good sense tht its going concern is definitely not in question !! sure follow your advise to buying on dip...but nobody can tell whether it ll dip further or rebound soon :p
yeah, no one can tell the future, for me buying at this price will not guaranty winning as well. At least u dont buy at peak, like PE hit 20+, this definitely will get yourself 'stuck' even longer than u thought. buying at such low PE 7+, you low down your risk by 2 times easily, going concern is not an issue (longterm stay), dividends payout to cushion your investment (though is merely 2-3% but better than none), up site is bright (bluechip couple with low PE), buying without fear (confident $$$ is coming) & most importantly EPF is buying ton of it, why should we worried ???
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