Entered CosmoSteel Holdings Limited (SGX:B9S)

A quantitative pick from the Singapore Exchange. A distributor of piping and steel components to the energy, marine and infrastructure sector. Beaten down by low oil prices. Long history and seemingly shareholder friendly. Price: 0.116. NCAV: 0.37.

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1 year follow-up, QC Holdings, Inc (NASDAQ:QCCO)

QCCO has been in the portfolio for one year and it’s time to do a follow-up. Price has fluctuated during the year and is at the moment -17% (including dividends). The total dividend during the year was 0.075 $.

The share had a 52-week high of 2.68 $, which was equal to a 60 % gain. Still, a bit short of my get-out early trigger and now the share is in the red.

Glancing the key ratios and balance sheet the share still looks ok, so it will stay in the portfolio one more year.

Q3-14 Q4-15
Price 1.67 $ 1.3 $
F-Score 4 8
Z-Score 3.0 3.6
P/NCAV 0.59 0.5

1 year follow-up, Boom Logistics (ASX:BOL)

Time for a one year review of Boom Logistics. At the moment the share is trading at 0.1 A$, which is equal to a -23 % drop.

Boom Logistics was included in the portfolio on the assumption that Plant & Property could be treated as current assets and that the stock was a net-net in disguise. Given this assumption the share price had a big margin of safety one year ago.

The company has faced decreasing demand during the last year, primarily due to due to decreasing commodity prices. However, the company has been been able to sell down underutilized equipment and repay debt so the basic assumption has proven true.

The company is not profitable, but management seem on-top of the situation. As P/NCAV ratio is lower today and there is progress the stock will remain in the portfolio one more year.

 

FY-14 FY-15
Price 0.13 0.1
F-score 3 4
Z-score 0.1 0.1
P/NCAV*  0.57  0.52

*Includes 60% of Plant & Property

Entered Coventry Group Ltd (ASX:CYG)

Entered a new Australian mining/industrial/resource net-net. Discounting an earlier dividend from the balance sheet I entered at 66 % of NCAV (ie 1.47 AUD).

As with most companies trading at big discount to net current assets Coventry has it’s share of problems. F-score is at the lower-end (4). Blanace sheet is cash rich and mangament is implementing a stragetic review. At the current brun-rate I expect the company to last quite a while, It may be a bumby ride though.

 

Entered PC Partner Group Ltd (HKG:1263)

The depressed HK markets triggered another buy, this time PC Partner Group. PCP is an OEM of computer parts, especially graphics cards. They’ve actually manufactured the graphics card (Zotac card) on the very PC I’m writing this.

PCP is trading at 0.42 NCAV. I see three reasons the company has such a depressed valuation.

  1. Personal computers are in decline
  2. They are tied up in litigation
  3. Asset/liabilities ratio is not very good.

Interestingly PCP has had a good run over the last years due to a graphics card boom, due to bitcoin mining. However, now the bitcoin miners have turned to other solutions – such as custom integrated circuits.