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30-03-2014, 11:21 AM
The thing i like about Venture is its consistency in its dividends despite earnings drop. During the worse of 2008 recession, it maintained its 50 cts dividend since their profit and FCF can sustain it. This is despite their share price dropping to below $5. How many companies in SGX do that? Many will not hesitate to cut dividends when their earnings drop. Some will even issue rights to improve their balance sheet. Venture did neither.
I think its not venture did something wrong causing profit to drop. Its the electronics industry as a whole is still not in recovery stage. Amtek earnings is also not great and has been dropping since the last recession. I invest in Venture because of consistency in dividend. Not because it is a growth stock. Hence i chose Venture over Amtek.
Some concerns are:
1) Mr Wong is no longer young. He might not have the energy to expand into other business or take the group further. There are really a lot of subsidiaries under venture and its really not easy to manage so many of them.
2) This year earnings unable to sustain 50 cts dividend. So to mitigate the risk i am assuming 45 cts going forward.
Recently lightly vested.
I think its not venture did something wrong causing profit to drop. Its the electronics industry as a whole is still not in recovery stage. Amtek earnings is also not great and has been dropping since the last recession. I invest in Venture because of consistency in dividend. Not because it is a growth stock. Hence i chose Venture over Amtek.
Some concerns are:
1) Mr Wong is no longer young. He might not have the energy to expand into other business or take the group further. There are really a lot of subsidiaries under venture and its really not easy to manage so many of them.
2) This year earnings unable to sustain 50 cts dividend. So to mitigate the risk i am assuming 45 cts going forward.
Recently lightly vested.
