Valuetronics    Last:1.1    +0.01

Biz Times june 26..Valuetronics to expand

XD on 29.7.14. SGD 3 cents dividend. Price movement after XD will indicate whether investors hold long term view or merely punting this stock for short term gain. 

Hopefully it will be like Silverlake and SingPost, share prices remain strong after XD. 

 

http://www.nextinsight.net/index.php/story-archive-mainmenu-60/924-2014/8758-valuetronics-visit-reinforces-amfrasers-buy-call

 

VALUETRONICS: Visit reinforces AmFraser' s ' buy' call, 69-c target price

Excerpts from analysts' reports

AmFraser analyst: Renfred Tay (left)

Better productivity through automation. We recently visited Valuetronics&rsquo manufacturing plants in Daya Bay and Danshui, both near Shenzhen, PRC, and were impressed with the degree of automation being used (some made in‐ house by its engineers and some together with its customer). 

These processes have not only rationalised the number of head count needed (head count over the last 3 years remained stable at around 4000 employees in spite of revenue growth), but also improved yield, output rate and reduced the fl oor space needed.

Main production block at Daya Bay. Photo: AmFraserEven at current automation levels, we still saw pockets of areas that could still be further automated.  

Flexible production lines. We were also impressed with the fl exibility of their production lines.

Workstations on production lines could easily be rearranged very quickly when needed.

Valuetronics has consistently shown superior net margins (5‐ 6%) vis‐ à ‐ vis its other EMS peers (1‐ 3%) and we expect this key competitive advantage to be maintained in the coming years. 

No shop fl oor bottle necks in sight that could hinder growth. Our plant visit confi rmed that there were empty plots of land at the Daya Bay facilities that could be used to build another production plant.  

Soldering still done manually, implying room for more automation should volumes permit it. Photo: AmFraserHowever, with constant productivity improvements, which also save space, management currently maintains that there is still no need to build on the empty plots of land at Daya Bay for the next couple of years as there is still idle shop fl oor space at the existing plant.

Over at the Danshui plant (fully dedicated to its big customer for LED lamp production), we were told that there were ample factory fl oor space in the surrounding vicinity that could be still be leased.   All Valuetronics has to do is bring in the necessary machines to increase output.    

Further upside expected. Although Valuetronics has risen 23% since our initiation on 1 July 2014, there is still a sizable upside of 41% to our conservative DCF‐ based target price of S$0.69. Our target implies FY15F PE of 10x or ex‐ cash PE of 6.7x.

This target is not demanding in our view given our expectation of about 10% bottom‐ line CAGR for the next 3 years. We make no changes to our earnings estimates and maintain our BUY rating on Valuetronics.

 

seeing some retraction for this counter.

What is a good entry price ?

 

yup around SGD 3cents for HKD 20cents

halleluyah      ( Date: 17-Jul-2014 09:44) Posted: Is it dividend is Sin 3cts  ??

 

Is it dividend is Sin 3cts  ??

 

Price dipped slightly... vested!

 

how do one attend an agm? can some samaritan help this poor soul regarding the procedures. thank you very much.

 

AGM on 22 July. Waiting to see whether they will comment on their plans for the excess cash in their books.

 

Today can enter this fierce stock again. Price movement getting faster.

I have posted the entry and exit price at my blog

masterstocktrader blog spot sg

 

 

Whether by XD not sure. Can it reach there eventually I believe so. still more room to grow. why not take the dividend and then just hold it for the next upswing?

 

Can it cross 50 cents before XD which is at the end of the month? Thinking of buying more as at current price seems still have room for price to move up.

 

Report by Kim Eng

http://www.nextinsight.net/index.php/story-archive-mainmenu-60/924-2014/8723-valuetronics-

Excerpts from analysts' reports

Maybank Kim Eng estimates Valuetronics' fair value is 61 cents
Analyst: Lai Gene Lih

Lighting up the world
§ Having completed a turnaround exercise in FY13, Valuetronics financials have returned back to trend growth.

§ Valuetronics is firing on all cylinders for both the core Consumer Electronics (CE) and Industrial & Commercial Electronics (ICE) divisions. Strong demand for LED luminaries from a major multinational customer and new customer additions in ICE will be the main catalysts to drive earnings growth.

§ Company continues to trade at an undemanding valuation of 5.7x FY15E P/E (and only 2.9x on ex-cash basis) vs. the peer average of 8.3x. FY15E yield forecast to be 7%.  
 
Philips_LED7.14Valuetronics has indicated that the LED business stems from one large multinational customer but it does not disclose the product/client contribution breakdown. [U]Maybank KE has assumed that most of the LED business is driven by Philips &ndash the global leader for LED, lightings & luminaries.[/U]

Refocusing on the core
After 3 years of trying to turnaround the licensing business, Valuetronics made a decisive move to exit the business in FY13 and refocus on its core OEM/ODM business in Consumer (CE) and Industrial & Commercial (ICE) Electronics.

Strong demand for LED luminaries worldwide will be the dominant catalyst for CE business (68% of total revenue) - most of the business is driven by a single major customer, who also happens to be the global leader for LEDs lights.

On the ICE front, renewed efforts to grow customer base and wallet share should reinvigorate the sales mix and improve margin outlook.
 
A cash generative business that is under-appreciated
Valuetronics has consistently delivered ROEs in excess of 20% over the last 4 years and maintained free cash positive for 9 of the last 10 years.

The company has [U]zero debt and S$0.21/share of cash[/U] (close to half of its share price).

[I](Comment: Previously was 0.18/share of cash, not sure how it got to 0.21 now...but nevertheless,no debt)[/I]

Stock trades at 5.7x FY15E PE but stripping out cash, valuation falls to only 2.9x FY15E PE. Assuming a conservative 8x FY15E P/E, we estimate Valuetronics to be worth S$0.61/share, an implicit 43% upside.

We also believe management can commit to its dividend policy of 30%-50% payout given their solid track record. Our forecast yield is 7% for FY15E.

 

Have diversify for the past few weeks not much on hand now, take more then one year for all this gain, although I believe it will continue to go up somemore, but choose to take most of my profit, currently have transfer to yingli, usually I pick up with above  7k~8k amount per entry to avoid any move in the market and also  save on  the minimun brokage, as for how long will ying li return will need to wait patiently as I am more a fisherman, through out my balt for the bigger fish to be on line.

cheongsl      ( Date: 05-Apr-2013 07:24) Posted: Get in another 50lots two days ago.

 

closing to 100% profit on this stock .... but only bought a few lots 3 years ago... 

not rush to vest more. wait for xd

 

Go run up and it appears still early days. Vested.

HVRRVH      ( Date: 01-Jul-2014 16:08) Posted: Gained 3 cents. Maybe worth taking a look....

 

No one knw hw high, but 52c i will lok to sel half.

 

by the looks of a bb buying up all selling shorts and dun even que to buy. as if tmr will shoot to 0.60.

today almost 5 millions shares in trades and 70% is buying from sell lots...

really worth 0.55 this stock meh?

 

43 brkout, shown bullish,m not late to board the teain, . good luck.

daylight28      ( Date: 01-Jul-2014 20:56) Posted: no time to load up yesterday and this morning. by afternoon, the chance is gone

 

no time to load up yesterday and this morning.

by afternoon, the chance is gone

 

Hi everyone, I posted the entry and exit price on my blog @ masterstocktrader blog spot sg

Go see it. A nice trendy stock for trading.