Company News Update

[BlueKelah]

good method looking at 52 week low stocks. this fits in with the old adage of "buy low and sell high"

Usually i like to buy when they have bounced a bit from their 52 week lows and on the way up. Usually this signifies management has managed to do some sort of significant turnaround in the business or that the prospects in the particular industry/sector are improving significantly. Whilst this may not provide the maximum gain, it does mean that the chance of the undervalued stock having further gains is very likely. And if the balance sheet is strong with lots of cash, very limited downside. This also shortens the time needed to hold a value stock before seeing some capital gains as opposed to just buying at lows and waiting 2-3 years or more for the industry cycle to recover.

I reckon if you look at 52 week lows there would be a lot of OnG and shipping stocks and probably some property ones in the bunch.

[Boon]

good method looking at 52 week low stocks. this fits in with the old adage of "buy low and sell high"

Usually i like to buy when they have bounced a bit from their 52 week lows and on the way up. Usually this signifies management has managed to do some sort of significant turnaround in the business or that the prospects in the particular industry/sector are improving significantly. Whilst this may not provide the maximum gain, it does mean that the chance of the undervalued stock having further gains is very likely. And if the balance sheet is strong with lots of cash, very limited downside. This also shortens the time needed to hold a value stock before seeing some capital gains as opposed to just buying at lows and waiting 2-3 years or more for the industry cycle to recover.

I reckon if you look at 52 week lows there would be a lot of OnG and shipping stocks and probably some property ones in the bunch.

Is a stock at (or near) its 52-week low necessarily cheap or undervalued?
 
Could a stock, at 52-week low, keep on making new (and even lower) 52-week lows?
 
For stocks that have bounced a bit from their 52 weeks low – how do you recognize those that would keep moving up from there?
  
OTOH, is a stock at (or near) its 52-week high necessarily expensive or overvalued?
 
Could a stock, at 52-week high, keep on making (and even higher) 52-week highs?
 
What is so magical about the “52-week”?
 
Is it because, conveniently, a stock's 52-week highs and lows data are so readily available?
 
Why not 104-week, 156-week, 260-week or 26-week or …….?
 
What difference would it make to your stock selection?
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[chialc88]

Just for fun, let me take a first shot.
Of course, other value buddies do chip in and 
made this a meaningful edge...
Knowledge is Power...
Wish all VB... Huat ah!

1. Is a stock at (or near) its 52-week low necessarily cheap or undervalued?
   May be, and may be not.
   
2. Could a stock, at 52-week low, keep on making new (and even lower) 52-week lows?
   could be (and may be not)
   
3. For stocks that have bounced a bit from their 52 weeks low – how do you recognize those that would keep moving up from there?
   not very easy, but it's not important. The goal of buying at 52 weeks low is simply "not" to buy a favourite stock/company at high priceor in another words, not willing to be a sucker of buying hot stock at highest pricec.f. #9 below
   
4. OTOH, is a stock at (or near) its 52-week high necessarily expensive or overvalued?
   May be (and may be not)Basically, the price of the stock does not tell it's value.
   
5. Could a stock, at 52-week high, keep on making (and even higher) 52-week highs?
   could be (or might not be) 
   
6. What is so magical about the “52-week”?
   "52-week" is a easy for me as it's available thru online engine.  A) with simple program, these stocks can be identified EOD.  B) with a bit calculation, these stocks can be identified during the trading hour. 
   
7. Is it because, conveniently, a stock's 52-week highs and lows data are so readily available?
   bingo!
   
8. Why not 104-week, 156-week, 260-week or 26-week or …….? 
   why yes? 
   
9. What difference would it make to your stock selection?
   no too much different.Our objective is to free up time so that our VB can spend more time doing things that we like instead of reading news of all counters (and diverted our attention on those that deserve our quick look)
   

Enjoy and please... other valuebuddies, do chip in and help me to improve my edge.

Love Compassion



Yes, I imagine that the is a Phantom behind the market...
To win, there must be an edge...

Have fun...

[Boon]

Just for fun, let me take a first shot.
Of course, other value buddies do chip in and 
made this a meaningful edge...
Knowledge is Power...
Wish all VB... Huat ah!

1. Is a stock at (or near) its 52-week low necessarily cheap or undervalued?
   May be, and may be not.
   
2. Could a stock, at 52-week low, keep on making new (and even lower) 52-week lows?
   could be (and may be not)
   
3. For stocks that have bounced a bit from their 52 weeks low – how do you recognize those that would keep moving up from there?
   not very easy, but it's not important. The goal of buying at 52 weeks low is simply "not" to buy a favourite stock/company at high priceor in another words, not willing to be a sucker of buying hot stock at highest pricec.f. #9 below
   
4. OTOH, is a stock at (or near) its 52-week high necessarily expensive or overvalued?
   May be (and may be not)Basically, the price of the stock does not tell it's value.
   
5. Could a stock, at 52-week high, keep on making (and even higher) 52-week highs?
   could be (or might not be) 
   
6. What is so magical about the “52-week”?
   "52-week" is a easy for me as it's available thru online engine.  A) with simple program, these stocks can be identified EOD.  B) with a bit calculation, these stocks can be identified during the trading hour. 
   
7. Is it because, conveniently, a stock's 52-week highs and lows data are so readily available?
   bingo!
   
8. Why not 104-week, 156-week, 260-week or 26-week or …….? 
   why yes? 
   
9. What difference would it make to your stock selection?
   no too much different.Our objective is to free up time so that our VB can spend more time doing things that we like instead of reading news of all counters (and diverted our attention on those that deserve our quick look)
   

Enjoy and please... other valuebuddies, do chip in and help me to improve my edge.

Love Compassion



Yes, I imagine that the is a Phantom behind the market...
To win, there must be an edge...

Have fun...

That is exactly my point  - “the price of a stock does not tell its value”
 
At the end of a day, you end up with a list of stocks at (or near) their 52-week lows. How could you tell which ones are “undervalued”?
 
What exactly is the “perceived edge” that you think you have since these 52-week highs and lows data are readily available to the whole market (i.e. all investors)?
 
If the price of a stock does not tell its value, how useful, effective or efficient would the process of screening “52-week price lowness” be?
 
Would it be a waste of time instead of “free up time”?
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[weijian]

I reckon BlueKelah means using 52week low as starting point with the thesis "there is higher probability of lower valuation compared to other ways of rounding up a short list". There is little barrier to draw up this list and so most people believe their edge is the effort/distillation used to filter down the 52week low list.

52week low is just 1 of the methods i reckon one uses. It may be effective according to one's temperament and past experience.

[karlmarx]

I have bought stocks at 52 week lows which turned out to be big winners.

I have also bought stocks at 52 week lows which totally blew.

After spending much time looking at stocks near 52 week lows, my conclusion is that most of them are poor investment prospects. I don't like to be speculative so the cyclicals, highly-indebted, and s-chip companies will be ignored; this makes for about 3/4 of the list.

For the remaining 1/4, most of them are has-been or low/no profit companies with most of their assets in ppe.

But from time to time, i find companies with quality operating businesses and balance sheet which i eventually buy. This occurs in the frequency of once or twice a year. Retrospectively, i feel that spending more time learning/understanding the underlying businesses of prospective companies allows for individuals to grow further as investors. Monitoring prices; not so helpful.

Maybe the other VBs can share how successful this strategy was for them.

[Boon]

I reckon BlueKelah means using 52week low as starting point with the thesis "there is higher probability of lower valuation compared to other ways of rounding up a short list". There is little barrier to draw up this list and so most people believe their edge is the effort/distillation used to filter down the 52week low list.

52week low is just 1 of the methods i reckon one uses. It may be effective according to one's temperament and past experience.

“Using 52 weeks low as a starting point for choosing undervalued stocks” was first suggested on this tread by “chialc88” in post #10 (and not by Bluekelah). 
 
It actually could be done on the SGX website in less than a minute:
 
1)
Click “StockFacts” under “Company Information”

2)
Remove all other default “search criteria” by clicking on the “X”

3)
Check or tick “Current Stock Price vs 52 week low” under “Edit Search Criteria” (This would made 52-week lows as the sole search criteria)

4) 
On the distribution bar (in green color), adjust the “Max” to say “5%”.

5)
On "Customize Display", tick  “Current Stock Price vs 52 week low” only 

And there you have the list…………………………………
 
My point is every investor could draw up the 52-week low list – the level playing field is even – it would be a big misconception in believing that one could have an edge over other investors in this respect.
 
Obtaining the 52-week low list is the "easy part" – the "hard part" is how does one evaluate from the list which stocks are undervalued – this is the area where one could develop an edge over others according to one’s investment objective, risk appetite, experience, skill, temperament etc.
 
< Using 52 week low as starting point with the thesis "there is higher probability of lower valuation compared to other ways of rounding up a short list".>
 
True, 52-week is just one of the many “starting point”. This is a question for the believer in "52-week low":

"Would the probability of lower valuation be increased (i.e. become higher) if one used the 104-week or 156-week lows instead, I wonder?
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[specuvestor]

My experience is that it takes about 18 months for things to flush out or stabilize. (So maybe 78 weeks low better? )I agree with Boon is just one of many filters like low PTBV low PE etc to find new ideas. End of day actually no short cut to understand the ABS of the stock if one is a fundy longer term investor, as much as people like to use quant or ratio to make it heuristically easier with less info or considerations

[chialc88]

Thanks  RB, BK, k, W and S for teaching.

I'm still learning and my future success depends on your input/help.

Once again, Happy Chinese New Year.
And, I wish everyone a healthy and wealthy cock cock year!


I think there is not enough time for anyone.
We are so busy doing those things that we like to do.


I do lookup the (52) weeks low stocks/companies as a habit for ideas for a few years.
It's more a habit than something fun.

So, S's input on 78 weeks  low can be twisted easily as I know how to crawl stock market data easily.

And, of course, it's only a starting point for discovering ideas.
Definitely can not buy every 78 weeks low stocks and call it an edge.

As for B, well says on the turn.
I do this as a habits too.
Unfortunately, the impact of practising this means I need to be even more patient.

(I thought using 78 weeks low can cut down the time to buy a stock.
  now, with the up turn then can buy.... is really another patient games.)

What to do? we are value buddies mah.

Looking forward to more contributions from everyone.

Love Compassion

[soros]

Here is my 2ps worth of contribution :

1. Take BK's method ( see post no. 11 ) and screen out a list of shares with prices standing near to 52 week low and showing a small bounce ( say 5% or more )..
Note - some shares with market price showing no bounce in last 30 days may be in continuing lower trend and should be removed from list.
Compare the share price against net asset value (NAV) ( NAV figure taken from last Annual Report ) and if share price is higher than 80% of NAV, remove from the list.

The remaining shares on list can be selected for purchase about 2 months before the date of next half yearly results are out and to be sold just before ex-div date if trading results are only average. Avoid buying into the shares with low turnover.

2. Apply same method ( as in No. 1 ) to shares with prices fallen to a 78 weeks low .