Posts tagged ‘NEXT MEDIA 壹傳媒 (00282.HK)’

HK282 VWAPThe sale of HK282 Next Media’s Taiwan business is announced on HKEx page!  Tomorrow, HK282 will apply for trading resumption.  And tomorrow is the day to experience the full force of the Boom Boom Boom!! we spoke about in this series!

 

Stock Date Closing Price
HK282 Nov-27 1.59

 

Tomorrow, is also the day to resist giving in to the force of the Boom Boom Boom!!, which can drive lots of extreme positive emotions!  Tomorrow is the day to resist parting-ways with something that still continues to be interesting, but may go up alot!

Its a game of emotions and discipline!

We believe this is not the end of the Next Media story.  There has been widespread rumors that Mr. Lai may sell his entire stake in HK282!!  More on that in future articles.

We hope you found our ALERT! series interesting and thoughtful!

– Mr. Alpha

Alpha InvestmentsBelow is a short summary of all the stocks mentioned in the Alert! series and their subsequent price performance.  The column “closing price (DP)” quotes the price the day after the post was live:

 

Stock Date posted Closing Price Last closing price % gain
HK2777 Nov-18 10.54 11 4.4%
HK8220 Nov-11 0.13 0.157 20.8%
HK282 Oct-02 0.88 1.48 68.2%
HK2688 Sep-02 30.85 34.65 12.3%

 

All positive gains!  Congrats to those who found our articles interesting for action!

Nov 27th is an important date on Next Media as that is the date of signing for the Taiwan Business sale announced as of now.  More to come later on this!

-Mr. Alpha

 

Alpha InvestmentsWanted to take the chance to thank people who have “Liked” our page!  Your support is invaluable and encourages Mr. Alpha to look for more interesting names to talk about!

“Liking” our page has a distinctive advantage where if we broadcast a new post, your facebook feed would immediately pick up the feed so you can read what was newly written first hand!

For our Alert! series so far, here are the posts we have made:

 

HK282 post – Boom Boom Boom!

HK2688 post – VWAP Trend!

 

And here are year to date performances of the above stocks since the date we wrote about them.  Last closing price as at Nov 7th, 2012:

 

Stock Date of Blog CP at date of Blog Last CP % Increase
HK282 Oct 2nd, 2012 0.76 1.66 118%
HK2688 Aug 31st, 2012 30.6 33.45 9%

 

And where, may I ask, do you get performances like the above between August to Nov in such a short period of time?  I do have to say, picking out HK282 had an element of luck in it, but our record of finding out interesting names is so far, so good!

Or you could pay HKD 6 dollars to read stock analysis in the newspapers.  There, you almost always get a new pick everyday!

If you find our analysis interesting to read and think others may as well, do let others know to “like” our page as well!  The more “likes” we get is then a real testament to value of the work that we do!!

Invite a few more friends to join!

– Mr. Alpha

HK282 blogAnd What do you know!  The famous Mr. David Webb (who used to be a director of HK388 (Hong Kong Exchange and Clearing Limited)), posts an article on his views of HK282 at “Cashing up at Next Media“!

If I may summarize, the main point from Mr. Webb’s article is that HK282 will become a net cash holding company with excess cash of HKD 1.79 per share if the Taiwan business sale completes!

Mr. Webb calls for HK282 to distribute a special dividend if the Taiwan transaction goes through, which would be a “Merry Christmas for Mr. Lai and his fellow shareholders.”

By the way, HK282 responded by gaining almost +9% on Friday, at the time when most names were dropping that day.

I refer to our previous article on HK282 where we believe if the Taiwan business sale goes through and we value the Hong Kong publishing business at 10 times last year’s earnings:

 

I get a value of HKD 3.32 per share!

 

Given the sharp increase in price on Friday and it was based on heavy trading volumes of 35m+ shares, I think the time to reach the above price may shorten!

– Mr. Alpha

HK282HK282 has requested the exchange to suspend trading in shares to annouce price sensitive information!  Ming Pao daily and many other sources have reported that the potential price sensitive information is that Next Media has finalized to sell its Taiwan publishing busines for HKD 4.64 bn.

 

This is equivalent to about HKD 1.92 per share!

 

From the previous post, we have noted that Mr. Lai Chee Ying holds 74.05% of Next Media.  On May 30th, 2008, HK282 traded at HKD 3.4 per share. 

 

So on that day, Mr Lai’s stake in Next Media translates to about HKD 6bn.  His stake as at Oct 25th 2012 is worth about 2bn.

 

So if you were to step into Mr. Lai’s shoes, would you sell your golden goose cheaply given that you own the majority stake to very profitable publishing businesses?

As per latest financial statements for March 2012 year end, HK282 earns about 43% revenues from its Taiwan operations, the remaining 57% translates to offshore profits at about HKD 342m (about 0.14 per share).

If factor in the HKD 1.92 per share sale of Taiwan business, plus valuing offshore profits using a 10 times multiple assuming zero growth, (This is a some what generous rough estimate, with has basis in CAPM from the HK282 returns stats page)

 

We get a value of HKD 3.32 per share!

 

That’s a potential 196% price increase from the Oct 15th HKD 1.12 per share closing!

And this time, I want to see how long it will take to reach this price without applying any discount.

 

– Mr. Alpha

HK282HK282 closed at HKD 1.12 per share yesterday, which is a sharp price increase of 47% since Sept 28th reference in our previous post!

 

 

 

Only about 13% left to reach 70% of fully valued book value at HKD 1.26 per share!

 

There are rumors that the Next Media publishing business in Taiwan alone may fetch HKD 3.3bn.  That alone is worth about HKD 1.37 per share.  And that’s not counting the Hong Kong side of the business with Apple Daily and Next Magazine.

HK282 is very likely to trade extremely sensitive to ANY news around the sale of its Taiwan business.  But as Mr. Lai Chee Ying holds 74.05% of HK282, my view is that he is unlikely to sell profitable businesses at a low price.

More to come if the sale of the Taiwan media business is announced!

 

– Mr. Alpha

HK282Next Media (00282.HK) annouced the sale of its loss making Taiwan Television business for about HKD 370m (0.153 per share).  According to last year’s financial statement for the year ended March 2012, the Television entity lost over 1.1bn HKD (0.456 per share)!!

Selling the loss making entity is good news for HK282 I believe, because if we consider the profit making newspaper and magazine businesses, earns about HKD 500m last year (0.207 per share).

00282.HK     Closing Price    0.76 per share    Sept 28th, 2012

According to last year’s financials, the book value of HK282 is about HKD 1.83 per share if its mastheads and publishing rights are fully valued.

I believe HK282 has potential to be priced at book value.  But let’s build in some margin of safety and see if HK282 can reach 70% of book first.  The upcoming financial statements will likely still reflect losses from the Taiwan TV business.

At 70% fully valued book, that would be a price at HKD 1.28 per share.

– Mr. Alpha