Friday, October 17, 2008

WingTai .... a sparrow or an eagle lying dormant?


Lately, Wingtai has increased it's stakes in USI holdings. So SGDividends decided to see whether this company's management was mad or not and whether it is overly expanding...and run the risk of not being able to pay their loans, just like Ferrochina. Take note that Wingtai is in the property development business and retail lifestyle business, which will be hit hard in recession...

See the balance sheet above, current liabilities is way less than current assets. Good.....and WOW..it has a CASH WARCHEST which by itself can even pay off 2 times its current liabilities!

See their Cash Flow above.Its cash flow from operations is also consistently making positve flows, even after deducting from their expenditure needed to sustain the business...its still positive....Good.

And look at its Net Asset Value ( what the company is worth per share)....$2.03. And how much is a share now? $0.73. ( But then again most companies are cheap now...aren't it?).And guess what..nearly everyday from 1 Sep 2008, they have been consistently buying back their shares.....why not..they are Cash Rich!Definitely in our watchlist!!We give it 5 chilli padis!

Important: The objective of the articles in this blog is to set you thinking about the company before you invest your hard-earned money. Do not invest solely based on this article. Unlike House or Instituitional Analysts who have to maintain relations with corporations due to investment banking relations, generating commissions,e.t.c, SGDividends say things as it is, factually. Unlike Analyst who have to be "uptight" and "cheem", we make it simplified and cheapskate. -The Vigilante Investor, SGDividends Team





5 comments:

  1. Since its low at $0.655 it has been quite steady. Today its at $0.675 minimum. Do you think it is time to go in? I just need an opinion. Thanks for sharing.

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  2. Hi Cathy,

    Thanks for asking us for our opinion..even after we drew hair on bald people..haha..

    Anyway, regarding your question. are you a short term or long term....?

    Generally, specific shares will go up or go down more than normal when there is some major company news...we don't see any catalyst in the near term to invoke such a movement for this counter, other than the general bearish sentiment of this sector. So if you are a short term trader..will there be any positive news flow coming from this sector near term than will override the negativity?

    If you are a long term, at this price, it is considered cheap..though, we think it has a tad bit of gravity pulling down on it and the general market in general.
    Dollar cost average....We wished we knew the pinpoint exact price to enter and exit too...then we need no longer call ourselves cheap.

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  3. Hi SGDividends,
    But shouldnt we also look at its long term debt which is more than $1 billion plus?
    thanks

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  4. Hi Anonymous,

    Yup, Wingtai's long-term
    borrowing is $1,095,098,000. Capitaland's long term borrowing is $8,166,281,000. Allgreen's long term borrowing is $1,009,959,000.

    When we compare with other companies in the same sector, its nothing to be alarmed.

    What's different though is Wingtai has a Cash balance which is 3-4 times its current liabilities, we dont think any other property counter has this kind of strength, especially in this short term credit crunch.

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  5. Seems that it has reach a plateau of $1.41 I wonder if there is anymore room for growth this time round.

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