LHT Holdings

[ghchua]

Hi weijian,

I am surprised that you classified SL as a value trap and you mentioned Tencent distribution in specie. If you track back SL's history from Hai Sun Hup and their long term dividend track record, you would have noticed that SL, Singapore Shipping and Cougar shares were all from Hai Sun Hup. Investors who had stay invested since those days would have benefited from shares in all these 3 companies (from one). And yes, all 3 are dividend paying even after investors received those shares.

[ksir]

hi ksir,

Thanks for your views. Indeed, views from participants of the market are generally diverse. This is why we see that we have "sufficiently efficient market". And if everyone is generally tilted towards bullish or bearish, then we are going to get to the extremes and generally the extremes are where money is made/lost as the market gets more inefficient (than efficient).

We know that the odds of making money is governed by this equation --> odds of been right ("A") x how much you make when you are right ("B"). When certain companies get really cheap, "B" may get really high, especially if they are backed by real assets/functioning business. So the key is assessing "A". Just that sometimes for "certain companies", the odds would be akin to buying 4D. Sure, you may win after buying long enough (or waiting in our context). But my personal preference is that in the absence of a market crisis, i would put more emphasis on "A" than "B".

Finally, we can't control how other people think/act about such labels. Just because they misuse it, doesn't mean I m going to misuse it or those labels ain't useful for me.

P.S. In my earlier post, I left out my opinion on Tencent. In general, I haven't studied Tencent in detail but how the share price moved isn't a big consideration. It is definitely more attractive as an investment now compared to a few years back when its share price was higher - The company is now unlocking value by distributing its investments as dividend in specie and peak regulation has passed. On aggregate, I don't think it is any trap, previously or now.

Hi weijian,

Think we're just playing diff game.

To me, price is what you pay, value is what you get.

I assess the company value based on my understanding of the company business model, earning power, balance sheet, management, risk etc etc. 
When the price is significantly lower than my calculated value range and after comparing other available options (my other investments, risk free % etc etc), I then invest in the company. 
As simple as that. 
If my assessment of value turns out to be wrong, then so be it, learn the mistake and try to improve my assessment skill.

Value trap/ growth trap is the same as value or growth labels to me (the label even got value/growth with it).

[weijian]

Hi weijian,

Think we're just playing diff game.

To me, price is what you pay, value is what you get.

I assess the company value based on my understanding of the company business model, earning power, balance sheet, management, risk etc etc. 
When the price is significantly lower than my calculated value range and after comparing other available options (my other investments, risk free % etc etc), I then invest in the company. 
As simple as that. 
If my assessment of value turns out to be wrong, then so be it, learn the mistake and try to improve my assessment skill.

Value trap/ growth trap is the same as value or growth labels to me (the label even got value/growth with it).

hi ksir,

I don't think our game is very different, although how we approach may have some differences. I respect differences because i think it is a privilege to see/review different approaches, and see how I can improve on my own game based on my own temperament. For sure in 1 years' time, I do not wish to see myself still the same as now. It has to evolve or I have wasted all those time.

The last thing I want, is to stay in an echo chamber that sounds the same as my own drum.

P.S. Our discussion is getting abit OT for LHT Holdings and as moderator, I have to censure myself soon if it continues on...

[RBM]

Hi weijian,

Think we're just playing diff game.

To me, price is what you pay, value is what you get.

I assess the company value based on my understanding of the company business model, earning power, balance sheet, management, risk etc etc. 
When the price is significantly lower than my calculated value range and after comparing other available options (my other investments, risk free % etc etc), I then invest in the company. 
As simple as that. 
If my assessment of value turns out to be wrong, then so be it, learn the mistake and try to improve my assessment skill.

Value trap/ growth trap is the same as value or growth labels to me (the label even got value/growth with it).

hi ksir,

I don't think our game is very different, although how we approach may have some differences. I respect differences because i think it is a privilege to see/review different approaches, and see how I can improve on my own game based on my own temperament. For sure in 1 years' time, I do not wish to see myself still the same as now. It has to evolve or I have wasted all those time.

The last thing I want, is to stay in an echo chamber that sounds the same as my own drum.

P.S. Our discussion is getting abit OT for LHT Holdings and as moderator, I have to censure myself soon if it continues on...

Don’t be hard on yourself Weijian - you do an outstanding job as Moderator.

I suggest recent posts on this thread have, amongst other things, formed an insightful discussion on the term “value trap”. I further suggest “value trap” is one of those over-used terms in the world of investing. Used particularly by many who don’t like a particular stock for one reason or another. Some of those reasons may be valid of course but often it’s rooted in an emotive, rather than a calculated, dislike.

I will now go for a chat with the biggest value trap in my life …. Mrs. RBM. But I couldn’t live without her. There is an analogy there somewhere.

Compliments of the season to everyone.

Vested (in LHT).

[ksir]

Hi weijian,

Think we're just playing diff game.

To me, price is what you pay, value is what you get.

I assess the company value based on my understanding of the company business model, earning power, balance sheet, management, risk etc etc. 
When the price is significantly lower than my calculated value range and after comparing other available options (my other investments, risk free % etc etc), I then invest in the company. 
As simple as that. 
If my assessment of value turns out to be wrong, then so be it, learn the mistake and try to improve my assessment skill.

Value trap/ growth trap is the same as value or growth labels to me (the label even got value/growth with it).

hi ksir,

I don't think our game is very different, although how we approach may have some differences. I respect differences because i think it is a privilege to see/review different approaches, and see how I can improve on my own game based on my own temperament. For sure in 1 years' time, I do not wish to see myself still the same as now. It has to evolve or I have wasted all those time.

The last thing I want, is to stay in an echo chamber that sounds the same as my own drum.

P.S. Our discussion is getting abit OT for LHT Holdings and as moderator, I have to censure myself soon if it continues on...

Don’t be hard on yourself Weijian - you do an outstanding job as Moderator.

I suggest recent posts on this thread have, amongst other things, formed an insightful discussion on the term “value trap”. I further suggest “value trap” is one of those over-used terms in the world of investing. Used particularly by many who don’t like a particular stock for one reason or another. Some of those reasons may be valid of course but often it’s rooted in an emotive, rather than a calculated, dislike.

I will now go for a chat with the biggest value trap in my life …. Mrs. RBM. But I couldn’t live without her. There is an analogy there somewhere.

Compliments of the season to everyone.

Vested (in LHT).

A tons of knowledge there Mr RBM. 
Now you guys know why I don't use value trap haha. 
She is my value investment  

Happy holiday guys and new year in advance.
Wish u guys good health and wealth in 2024 and beyond.

Sorry Weijian, I will stop posting OOT here.
I sold LHT too early few years back because I thought it was value trap hahaha (before I learnt my lessons)

[¯|_(ツ)_/¯]

Merry Christmas and wish every valuebuddies a happy 2024 ahead.

LHT is definitely a good company - value trap or not.

From my trading record, I begin collecting on week #1 of Jun 2021 and on average at a cost of (roughly) S$0.64.

Until 14 Dec 2023, LHT was always a value stocks selling less than $1. Giving the light transaction volume, it's rather difficult for anyone to accumulate.  A bit of buying will push the price high easily.

I'm not selling and I do not intend to sell LHT and so the increasing price is immaterial to me.

What would make sense to me - after witnessing the increasing price - would be the naturally increasing dividend - might not be the % but likely in absolute value.

Traditionally, LHT gives 3 cents to 5 cents dividend every year.  If the high price continue, then my instinct tells me that 5 cents dividend would be the minimum aka there is a high chance that dividend will goes up.  Only question is whether the current price above $1 is sustainable.   

---

When I brought LHT back in Jun 2021, there was no intention to sell.  In fact, majority of my purchased business is for long term holding as I do not have a need for the $$$.

If you have time, take a look at the latest annual report and 1st half report (link to sgx), these are what you will observed:
1) Revenue trending down 

Other than revenue trending down, the rest of the business and operation metrics looks pretty cool.
2) GPM
3) NPM
4) PE
5) PB
6) debt - virtually no debt
7) etc

---

Again, I'm not a stock analyst nor have the ability to perform thorough analysis.  I just follow what ex-valuebuddies CFA said: 
"I don’t look to jump over 7-foot bars: I look around for 1-foot bars that I can step over."

The investment case for LHT is a 1 foot bars to me.

What do you think?

Have a Merry Christmas, everyone:


Gratitude!

[¯|_(ツ)_/¯]

LHT@90cts

FY2023 Result out (link to SGX)

Rev, GP, NP dropped 13%, 14%, 22% respectively.

Div 18cts (5cts + 13 cts special)

Gratitude!


And thank you all valuebuddies especially @R** for introducing such a fantastic "value" company. 

Enjoy: G.E.M.

[RBM]

Strange to think…. 2 months ago there was a debate on this thread ….along the lines of “is LHT a value trap?”. I suggest that question has been answered - if ever the answer was in doubt - with Friday’s Dividend announcements.

Vested

[¯|_(ツ)_/¯]

@R - wishing you a happy CNY 2024  and your well deserved big ang pow 

Ask you a question (especially with the big ang pow in mind), does it really matters whether LHT is a "value trap"?

What I meant is if LHT does not give out the big ang pow, then does it means that it is a "value trap"?

From my perspective (even thou I'm really contented with Ms Yap ang pow), I do not ruled out LHT being a "value trap".

What I meant is most of my counters (except MMH) were based on value investment (what else? MOS law), and the key risks (to me law) would be it's a value trap.

At least, that's what I reminded myself and pay attention to the business (more that it's stock price).

Other than the risk of value trap, I also reminded myself not to be too carried away.  

Basically, there are 2 ways how a stocks can grow to become more than 20% of a person portfolio.  

• The easy way and the hard way.  In the easy way, there is nothing need to be done, the particular stocks automatically balloon above 20%.  
  
• In the difficult way, as the stock price goes down and the perceived MOS increase, one keep buying on the way down - until a particular stock cross the 20% holding marks.
  

So, other than the risk of value trap, I reminded myself not to double down or buy on the way down.  I mean, it's not that I'm not confident about the stock but rather I see this as a risk - a risk that I'm wrong.  

Therefore, if I do not buy on the way down, the opposite would be something I do - buy on the way up.

It's actually quite simple.
Suppose, there is a (under-)value stocks and all the stars are aligned for a buy signal - I will initiate first purchase.

Then, something happens and the stock started to turn aka price goes/going up, then I will go for second purchase.  Exactly opposite, if the price drop then I will not buy (even the MOS getting better and better).

Again, when the price continue to goes up, sometime I will buy more and sometime I just leave it alone and just monitor for the possibility of "value trap". 

Of course, the question is what would you do when you realised that it is a "value trap"?

Gratitude and once again wishing you a peaceful and prosperous 2024!
 

Enjoy

[weijian]

Dear all,

LHT had certainly done well lately in terms of share price! Year to date, it is up more than 30% and still going strong. A value trap? Certainly not, in my opinion.

This case study had underscored my view to always stay patient with stocks, especially when you do value investing. A stock can do nothing for years, but when it moves, it can surprise everyone, including myself sometimes.

@ghchua,
I look at the price history of LHT Holdings and saw that it increased ~20% in just a few days. I am genuinely surprised there wasn't a SGX query. Wouldn't be surprised that some corporate action has been leaked in advance of time...

hi ghchua,

2.5 months on, I think we are clearer why there was a sudden spike in price back in mid Dec

LHT's FY23 results look surprisingly strong to me. Post covid, logistics is cooling but LHT's margins for FY23 still looks robust and its cash hoard helps in the current high rates, especially so when Mgt is putting majority of it in FD (talk about good stewardship!).

The company has 42mil cash end FY23 and 13cents of special dividend translates to 7mil cash or just 17% of its total cash. So plenty more even though they have acknowledged in their AGM Q&A below:

"Distributing cash instead of reinvesting resources into the business is not a prudent long-term strategy. There is a limit to Singapore market and the Company must either find new market to grow or new businesses to enter into".