Posted on Wed 18 Nov 2009 23:10 by Novice_investor
dov222 wrote:
Of course, the company has had a few positive announcements recently, but the Kuwaiti stock market is ...
friends...
if you have a view on this scrip pls share... any analysis or comments would be much appreciated...
personally i feel this scrip has the potential to give tremendous returns over a short-term... 'potential'...
- it is able to raise money with adequate ease... shows a certain amount of trust of institutions and financial bodies in the co.
- second half only... expecting a break even... which means perhaps a very good q4... (questionable but expected)... going forward valuations may improve
- is trading much below the book value... can't give a figure here as differen numbers are floating the the market... but its around 25% atleast less than book value
- the company is re-focussing, restructuring itself... divesting non-core assets...
- about the senior management of the company... i dont know much... if someone could pls add to this... it would make all the difference...
Im hearing you guys say the bottom is in at 1.26.
Maybe, maybe not.
This stock in particular has taught us a good lesson, that there is no such thing as oversold or overbought.
Its been falling like a rock since a long time now, and even after their positive announcements, it has kept falling.
will it hold at 1.26? who knows... the kuwaiti index has begun to stabilize, but its too early to tell if it the correction is over there..
Im not saying it will break 1.26, just that i've become very wary of calling bottoms on this stock in particular... so ppl thinking about trading GFH, beware... dont do it without a plan that covers every scenario. ( those scenarios include falling to 1, or bouncing to 3)
Im not saying it will break 1.26, just that i've become very wary of calling bottoms on this stock in ...
GFH has been a volatile stock to trade.
The stock has fallen like anything but in between it gave good trading oppertunities. For eg., the stock fell to 1.67 and peaked to 2.69 in two days, 61%. Stock traders should study the pattern of trade here:
The day before it fell to 1.67, it gave a clear indication that a rebound was coming. The stock opened gap down on limit down and stood limit down at high volumes and after couple of hours the price moved up and again closed at limit down. The next day the stock opened gap down and fell further down on low volumes before strong buying interest developed and closed limit up. I have seen the same senario happening in ARTC and UPP and on both occassions later stock fell to lower prices still. In my experience, most of the time, stocks consolidate a bottom.
I have seen ARTC falling from 19.90 to 0.71 within months, though in between there was a 100% bonus issue.
I mean the market can do anything.
Study this piece of data, traders might find it useful in the future. Don't expect 61% gain in two days, it could be a rarity, 15-20% should be fine.
Its been falling like a rock since a long time now, and even after their positive announcements, it has kept falling.
I wasn’t aware of any positive announcements
The company made a net loss of $29 million in the three months ended September 30, compared with a net profit of $82.1 million in the year-earlier period and a second-quarter loss of $54 million. On November 3rd GFH announced that it had raised $300 million in fresh capital through a rights issue.
Losing money and diluting share ownership … Where is the positive news?
my talk of their announcements was incorrect, sorry. I dont know why i mentioned it, just eager to see it bounce so i can exit...Hoping something can stop the fall, but thinking about it now, nothing they announce will have an impact on the fall. You see, Kuwait is in a bear market, and until the general decline stops, GFH will continue to fall... (just like in reverse, in a bull market, negative announcements dont stop a stock from rising)
but to answer your Q, & if my memory serves me correct :
1. The rights issue being successfully subscribed to. USD 300 Mill
2. Sale of a non core asset ( a stake in Q-invest ) for U.S.D 50 Mill.
3. U.S 100 mill murabaha facility with Mcquire group...
4. something with Deutsche Bank?
5. plans to turn into a commercial Bank, instead of an investment bank focused on Real estate ventures.
6.Pending approval, plans to open a new branch, ( commercial) in Q4 2009.
7. Plans to rollover debt of USD 300 mill maturing in Feb 2010.
Yes, shares have been diluted, but that has been factored in already. Im not an expert on fundamentals, but i think sam did a quick analysis in the previous page.
Sure they have problems + restructuring, and it will take time to yield positive results, maybe 1-2 yrs min, but that doesnt mean it wont rebound before then.
initially, there was an imbalance in the prices btw here and Kuwait and Bahrain...I mentioned in the 1st page, that some were transferring their shares from Kuwait, and selling here for higher...
Of course, to lure ppl in, like you and me, we were given a 3 day limit up show.. Many were sucked in and bought at AED 2+.
Very few ppl made money on those limit ups. But many have lost a good portion of their capital, because they played a stock they didnt know the complete story of..
To be honest, im one of them, i bought at 1.8, sold at 1.6. Lost 10% in a day. I re-entered at 1.44, (revenge trade- the worst), and have been stuck since... This share has turned many speculators into investors, lol..
Anyways, from 1.6, to 1.3, i think the decline has been mainly due to the Kuwaiti index crashing...( see the chart for the kuwait index)
at this level, it is below the rights issue price. No one selling now is making money, No one. But there are some ppl ( i wont say big boys ), who are happily accumulating at these levels.
People watching this share know what im talking about. Mega 1 mill and 2 million sell orders at prices like 1.39... Are you kidding me? does someone who owns that much money willing to sell at these ridiculous prices, knowing fully well the company has raised liquidity to survive, or are they just pressuring it lower...
In conclusion, lets hope the Kuwait market recovers sooner rather than later..
Thaj, thanks for the data, yes it had a crazy rebound in between, but its very difficult for anyone to enter and exit at exactly the right times... Even the best traders can get caught...
Lets say you bought at 1.67, and somehow had the instinct to sell at 2.69. Took your profit, and then waited for it to fall again to 1.67, before re-entering.
It then limits down again to 1.46, but you dont sell here, because you think its too cheap, that it will rebound. But it doesnt rebound, and falls again to 1.26... and before you know it, you find yourself stuck. (something like the GGICO trade you mentioned).
and about the bonus issue with artc, im pretty convinced, in a bear market, even the best announcements will not stop a stock from falling..
But if you're saying GFH could be a very profitable trade, then yes, sure. But very very hard, when its falling the way it is...
Personally, once im done with GFH, at the nearest bounce, im done for good with Kuwaiti stocks... It will be interesting to see if the UAE market declines, and the Kuwaiti rises, how GFH will react, if we are leading or following...We'll see soon...
Posted on Sat 21 Nov 2009 00:33 by Novice_investor
dov222 wrote:
my talk of their announcements was incorrect, sorry. I dont know why i mentioned it, just eager to see ...
- there also a statement by the company ceo that they are expecting to break even the second half balance sheet... which means q3 + q4 = positive or quits... considering q3 was negative and with all eyes on the company... something nice might be brewing for q4...
- also... kuwaiti market might just act as a hedge to the global markets... something you indicated sort of... just like the way dfm was before the crisis... also... as far as i know... kuwait does not suffer from any liquidity problems...
Sorry for the missing link, seems the whole post disappeared
Whoa . You've scared me there. I didn't delete it, and I'm assuming you didn't delete it?
Or are you talking about the GFH report link from yesterday in the GGICO results topic? I couldn't open the link directly either, although I did manage to find the report on the Argaam website ... eventually.
sam111sam wrote:
Read this report on GFH and let me know what you think ...
This is not Deutsche bank buying into GFH. This is Deutsche bank buying on behalf of some of their clients, a few of whom have converted already (you get the first years 8% coupon on the murabaha even if you convert, so 0.38 * 0.92 is the actual price).
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. You've scared me there. I didn't delete it, and I'm assuming you didn't delete it?
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