Westports definitely has not attracted the attention of investors, retail or big fund managers, looking at the performance of its stock since listing on Bursa about four months ago. At one time the price came down to its IPO price of 2.50. Looks like its support level seems to be at 2.52. And yet it's too early to speculate.
The situation apparently resulted from its biggest customer rerouting some of their ships to another port and that entails a loss of shipping volumes translating into a loss of revenues for the company. Despite reassurances from its CEO, the market continues to overreact.
As the lock-up period is coming up soon for cornerstone investors of this stock, I am more apprehensive as to the level of decline in its price if these big guys start selling. But from my experience similar stocks could actually transform as some smart investors, waiting quietly in the sidelines, start grabbing the stock at a lower price and only for it to soar a few months later. Well, I am willing to wait for the later scenario.
What I like about Westports is the company's promise to distribute as dividend 75% of its annual profit and from the financial report, I am convinced that I should stay with them. Last financial year (2013)(excluding special dividend payment) the total dividend paid was a bit more than 9 sen per share, a return of roughly 3.6% based on NAV of 2.50. Hence the more the profit the more the dividend.
And believe you me, despite the bleak sentiment, yours truly decided to acquire more Westports shares before its dividend ex date on 26 February. Incorrigible? Even my better half is shaking his head as there is hardly a breakout in the price trend following the dividend announcement.
I went through the company's report and its financial results and I believe that things will pick up, given their good management and their rolling out of more services on their infrastructural expansion, barring any socio-economic and political obstacles, the usual risk factors. This is just my layman's analysis. You all buy the stock at your own risk!
I am keenly looking at the stock's price appreciation which could take a couple of years and unless its annual dividend is going towards more than 14 sen per share ( in my case, a modest return of 5.4%), I will liquidate my position and invest elsewhere..
In the meantime, let me enjoy my first single-tier dividend of 5.22 sen per share ( a return of a mere 2.0% ) from Westports, announced on 13 February 2014 and to be credited into my bank account on 11 March 2014. It will be used to top up my unit trust fund, AMBVTF which consistently, over a period of more than five years, gives an annual yield of more than 15%. Hopefully the trend will continue.
Nevertheless, being pathologically optimistic, I am looking forward to Westports financial year 2014 and possibly 2015.
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| Westports' lacklustre performance post-listing Source: Bursa Malaysia |
As the lock-up period is coming up soon for cornerstone investors of this stock, I am more apprehensive as to the level of decline in its price if these big guys start selling. But from my experience similar stocks could actually transform as some smart investors, waiting quietly in the sidelines, start grabbing the stock at a lower price and only for it to soar a few months later. Well, I am willing to wait for the later scenario.
What I like about Westports is the company's promise to distribute as dividend 75% of its annual profit and from the financial report, I am convinced that I should stay with them. Last financial year (2013)(excluding special dividend payment) the total dividend paid was a bit more than 9 sen per share, a return of roughly 3.6% based on NAV of 2.50. Hence the more the profit the more the dividend.
And believe you me, despite the bleak sentiment, yours truly decided to acquire more Westports shares before its dividend ex date on 26 February. Incorrigible? Even my better half is shaking his head as there is hardly a breakout in the price trend following the dividend announcement.
I went through the company's report and its financial results and I believe that things will pick up, given their good management and their rolling out of more services on their infrastructural expansion, barring any socio-economic and political obstacles, the usual risk factors. This is just my layman's analysis. You all buy the stock at your own risk!
 |
| Patiently waiting to ride Westports' uptrend :) |
In the meantime, let me enjoy my first single-tier dividend of 5.22 sen per share ( a return of a mere 2.0% ) from Westports, announced on 13 February 2014 and to be credited into my bank account on 11 March 2014. It will be used to top up my unit trust fund, AMBVTF which consistently, over a period of more than five years, gives an annual yield of more than 15%. Hopefully the trend will continue.
Nevertheless, being pathologically optimistic, I am looking forward to Westports financial year 2014 and possibly 2015.
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