Sunday, 16 September 2012

MR Fong Siling's Pick -- ECS

Why do Mr Fong Siling likes ECS??
  • The company proposed for 1-2 bonus in September 2012, but based on the price in early this year RM 1.2 to highest of RM 1. 63 ... The gain is ? 
  • The Fundamental analysis by MR Fong Siling base on the 8 criterias:
  1. Standard one: The current Ratio: 

    Current assets (Current Assets) can be turned into cash within one year of the assets, current liabilities (Current Liabilities) liabilities must be repaid in one year.
    The current ratio is current assets ÷ current liabilities derived from the ratio, the higher the better.
    ECS bill in the first quarter of March 31 this year, the current ratio of 306 (million) ÷ 156 (million) = 1.96, far more than twice as belonging to super.

    Standard: working capital (Working Capital)
    Current assets less current liabilities of ECS working capital on March 31 this year, 306 (million) -156 (in millions) = 150 (million), and more than sufficient to meet the operating funds needed .
    No wonder the company is no debt, there are 40 million ringgit in cash on hand.

    Standard three: liabilities to shareholders' funds ratio (Debt-To-Equity Ratio)
    Total liabilities divided by shareholders' fund income ratio, the smaller the number, said the company is relying on existing funds rather than borrowing to do business, so the smaller the number, the better.
    ECS debt to shareholders' funds ratio: 150 (million) ÷ 154 (million) = 1. Financial steady as a rock, 3 points.

    Standard Four: The net income per share (EPS)
    Annual income divided by the number of shares was the higher the better.
    ECS last year's net income per share was 20.70 cents, a medium deserve.

    Standard Five: earnings ratio (PER)
    The share price divided by net income per share, for the number of years required to recover the cost of the investment.
    Calculated ECS RM1 share price of 40 cents, the current PE ratio of from RM1.40 ÷ 0.257 = 5.5 (times), the international standards of the PE ratio is usually 10 times, the ECS 5.5 times PE ratio is low, deserved 3 points.

    Standard 6: The rate of return on shareholders' funds (Return On Quity, ROE)
    Annual income divided by shareholders' funds, thanks to a number.
    This ratio is used to test the efficiency of management, the higher the better.
    ECS net profit of 29 million ringgit last year, the shareholders' fund of $ 47 million ringgit, so shareholders fund rate of return of 29 (million) ÷ 147 (million) = 19.7%, 3% several times higher than bank fixed deposits.

    Standard Seven: dividend yield (D / Y)
    The dividend per share divided by the share price of the sum.
    The dividend yield is usually standard for calculating the net dividend.
    ECS last year sent a net dividend of 8 cents to 40 cents of the price of RM1, dividend rate of 8 cents ÷ 140 cents = 5.7%, almost twice as high than bank deposit interest rate of 3%, deserved 3 points.

    Standard Eight: per share, net tangible asset value (NTA)
    Shareholders' funds divided by the number of shares was the.
    ECS per share net tangible asset value of RM147 (million) ÷ 120 (million shares) = RM1.23, slightly lower than the market price of a stock, you should get two points.
    Summarize the eight standard, ECS made 24 points in 22 minutes, the company said strong fundamentals.
    ECS Sihai stack Zhang family control, has 25 years of history, the agent of the products of the world's more than 30 computer and mobile phone companies, distribution points up to 2500.
    Business fundamentals like the foundation of a building, the fundamentals are strong, said a firm foundation, and can withstand stormy attacks.
    Before buying, if they can do their homework to find out the strength of the stock fundamentals, according to the above method can reduce the risk. Risk reduction, equal to improve the odds.

Agent over 30 brands
The company is one of Malaysia's largest information technology products agency and distribution company, ICT is the abbreviation for Information & Communications Technology.Malaysia has over 2500 distribution points.
The company's agents and distributors of products, including laptop computers, personal computers, copiers, software, network, telecommunications equipment, data storage, etc.. More than 30 kinds of brands, including HP (Hewlett Packard), IBM (IBM), Cisco (Cisco), Microsoft (Microsoft), Apple (Apple), Dell (Dell), Oracle, the Epp application (Oralle, Epson), Samsung (Samsung), Pakistani law network (Buffalo), Adobe, Juniper, Blue Coat, Vmware, Google (Google), Canon (Canon), Philip (Philips) are a well-known brand in the world.
Singapore-listed ECS Holdings (ECS Holdings), associated ECS, ECS Holdings owns a 41% stake in the company, the Asia-Pacific region's largest IT products agent and distribution companies in China, Thailand, Malaysia, , Singapore, Indonesia and the Philippines, with more than 23,000 distribution points.

Growth? Is there a growth? Most probably!