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akira0422

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Reply #180 on: Dec 29, 2011, 09:31 AM
by the way on nat resources.... APC seemed a geotherm+mining +infra company... penny stock but seems ok fundamentally at a glance... i did a glance screening 2days ago... ther prospects are gud, though a few mining sites waiting for jv and funding... they seemed to be forging a partnership with bel and lr din... catch is that itys a little overbought and ratios are not to gud - i gues at 80% current ratio...

anyway back to edc...
is it ok to ask the most beasic question? i seem not to fully comprehend this one.
1. How does a geothermal energy producer profit? - (on a capacity production basis, usually how much to they earn per kilo/ megawat/hr they produce, versus the cost of generating it? vs cost of putting up the plant or Maintnce... it seems that currently one of the most efficient way of producing enegy is geothermal (i wont agree with wind or solar--)however it is not the most popular choice in the power sector.
2. y does the impairment penalties cost so much? esp, for a plant with relaticvely small capacity.
3. how much would renewable energy act affect its revs and profits...
4. what will be the targeted date for production and partial return of investment, esp on the note on offshore projects...

on the side... i think renwable energy act is just a bluff... but kodos ot EDC...the no. 1 geothermal energy producer in the world!!!
thanks TSO....



TSO

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Reply #181 on: Dec 29, 2011, 02:38 PM
Quote
by the way on nat resources.... APC seemed a geotherm+mining +infra company... penny stock but seems ok fundamentally at a glance... i did a glance screening 2days ago... ther prospects are gud, though a few mining sites waiting for jv and funding... they seemed to be forging a partnership with bel and lr din... catch is that itys a little overbought and ratios are not to gud - i gues at 80% current ratio...

Might want to look at it over the long run and determine why "current ratio" doesn't look good. Composition of current assets? Current liabilities?  Sh*t like that.

Quote
1. How does a geothermal energy producer profit? - (on a capacity production basis, usually how much to they earn per kilo/ megawat/hr they produce, versus the cost of generating it? vs cost of putting up the plant or Maintnce... it seems that currently one of the most efficient way of producing enegy is geothermal (i wont agree with wind or solar--)however it is not the most popular choice in the power sector.

Contract basis. Minimum take or pay.

They set a volume and price/unit vol. for the customer, usually an electric coop, and they send it over to them via electricity lines. Because it is a "minimum take or pay contract", the customer has to cough up money whether it takes the generated electricity, takes some of it, or not at all.

EDC never disclosed how much their MTOP contracts are supposed to pay when the customer does not take the min. volume, but I suppose it's at a cheaper rate per MW.

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2. y does the impairment penalties cost so much? esp, for a plant with relaticvely small capacity.

According to IFRS accounting (CFA L1 book 3, 2011 ed.), impairment costs occur when carrying amount of the assets exceed its recoverable amount, which is "fair value less than either selling costs or value in use".

Selling costs
~ price acquired from direct market or an existing agreement, less direct costs of disposal

Value in use
~ based on discounted cash flow model of valuation
~ estimates are based on how much of future CF's are derived from use of the asset, expectations on the CF's variations on amount/timing, the discount rate, and other factors

Sources of asset impairment are as follows:
~ Decline in market value
~ Negative changes in technology, market, economy, or laws
~ Increases in market interest rates
~ Company stock price below book value
~ Obsolescence or physical damage
~ Asset is part of restructuring or disposal
~ Worse econ performance than expected

Source: IAS 36, Impairment of Assets

Quote
3. how much would renewable energy act affect its revs and profits...

Cannot be determined from what has been disclosed by the company. When I was doing the screening, I read the entire annual report like I would with a deep scan, but the analysis/valuation itself just wasn't as descriptive and it was more "back-of-the-envelope" style, if you could already guess from the way I estimated its intrinsic value.

The only thing that's sure about the Renewable Energy Act is:
1. The government must yield priority to electricity made from renewable sources. Of course, if it comes to a head between competing types of renewable energy (nat gas vs. geothermal vs. solar vs. wind), then it's probably going to be FIFO. (I can't see it as anything else.)
2. Statutory income tax fixed at 10%, versus 30% for other corporations.

Quote
4. what will be the targeted date for production and partial return of investment, esp on the note on offshore projects...

No target dates. None of their materials promised a schedule on their returns from their offshore projects.

Besides, even if they did, it would be over the span of years.

One of my friends told me the reason for this discretion on disclosure is that companies' are in a conflict of interest already: if they reveal info, they inform both investors (good) and competitors/new entrants (bad). Unfortunately, even if competitors had zero access to investor-related material, they would STILL be in a conflict of interest.

Why?

Best example is EDC itself!

2010 A/R uses a KPI they never used in the previous years, but it is a KEY piece of info used in the industry, so they obviously had it since it became public. Now why do you think they just started disclosing it now?

Quote
thanks TSO....

Np.


bauer

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Reply #182 on: Jan 02, 2012, 10:42 PM
@Sir bauer,
why 20%?
arbitrary % yan o may sound basis?

Self imposed rate of discount. As much as possible I tried not to buy based on a book value stock price (ratio 1:1)

Syempre it's better if it is at least 20% below my book value para masunod ko ang rule na margin of safety.

I don't find edc attractive right now
« Last Edit: Jan 02, 2012, 10:43 PM by bauer »


finance123

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Reply #183 on: Jan 02, 2012, 11:35 PM
Para sa akin for this year 2012 - NO for EDC.


Curious_investor

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Reply #184 on: Jan 04, 2012, 09:26 AM
Hello TSO,

What is you opinion on AAI?
Its a backdoor listing vehicle of bloombery resorts of Razon.

Your insights is much appreciated.

Thanks


jawo

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Reply #185 on: Jan 08, 2012, 03:47 PM
Good day TSO,

I'm looking for an insight regarding PCOR and PPREF for the next 3 years.

As I have read from an online newspaper, SMC CEO RSA flaunted about the expansion of the Petron Refinery and will become the Philippines' most biggest and most modern Industrial plant and also a pacesetter refinery in the Asia-Pacific at a cost of Php77B.. (Whew!)

Is it recommendable to invest my money to them this year?
Thanks in advance.. :)


TSO

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Reply #186 on: Jan 08, 2012, 07:06 PM
Quote
As I have read from an online newspaper, SMC CEO RSA flaunted about the expansion of the Petron Refinery and will become the Philippines' most biggest and most modern Industrial plant and also a pacesetter refinery in the Asia-Pacific at a cost of Php77B.. (Whew!)

Before you even think of investing in them:
1. How long do you think it'll take before this expansion program is finished? Don't rely on company expectations.
2. How much will this expansion add to their capacity?
3. How much are they using right now?
4. Can they find the demand that will make use of this excess capacity, without compromising their prices?
5. Who will they sell to? Mostly international? Mostly domestic? Or equally both?

If you cannot figure this out... then here's a simpler set of questions:
1. How did the stock price react to the news?
2. Does the current market price reflect an expected growth rate that ASSIMILATES the expansion project?

~ If it went up after, then by how much did it go up? If it was a significant increase, you might wanna stay away from it, unless #2 is a "no".

Post Merge: Jan 08, 2012, 07:09 PM
EDIT: Just to remind people, I'm engaged with personal projects and another company right now, so I'm not taking requests.
« Last Edit: Jan 08, 2012, 07:09 PM by TSO »


bauer

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Reply #187 on: Jan 09, 2012, 10:24 AM
TSO, your questions about PETRON's business plans are valid and deserves an answer.

AS i see it in the global front, most of the biggest oil producers are veering away from refining business and concentrate all their resources in oil exploration and delivery.

Worldwide, there is a dent on demand from refining.  It is too expensive to operate a refining plant.  Competition is too strong.  There is no government incentives for local refiners.  I do not know how PETRON will survive in the short term after carrying a huge debt load.


jawo

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Reply #188 on: Jan 09, 2012, 11:34 AM
Well many thanks TSO for good and logical questions you put up that will make up to provide answers... That's just open me up reading the market behavior...

Thanks also Bauer for your piece of mind...

As a newbie, this is very helpful for my self analysis.. :)

As I know Petron has an excellent credit rating (AAA) according to PhilRating.. Then this clear up my mind to put my money to them..



ooddiicckk

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Reply #189 on: Jan 24, 2012, 11:07 AM
I'm investing with SMPH for a quite some time now.  Earnings like 27% now, i saw the rate in CITISEC that their recommendation is to sell at Php 20 per unit.  My question is whats the BUY BELOW rate of SMPH?

thanks!


akira0422

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Reply #190 on: Jan 27, 2012, 04:19 PM
on petron for short term... everyone was buying low at 17% discount....... now whose gonna buy up???????


robot.sonic

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Reply #191 on: Feb 20, 2012, 07:02 PM
Hi TSO.

Nag request ako ng analysis mo sa EDC dati. Pero di ako kaagad bumili. Buti na lang at medyo bumaba. So bumili na ako. :)

Kung may time ka baka pwede pa analyze din ng Philodrill Corporation (OV). May Konti ako nito. Sa .032-.033 ko nakuha. Medyo ok naman ang gain. Di ko lang alam kung kelan maganda bumitiw. Ang target ko ay around 0.06.


pocoyo

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Reply #192 on: Feb 20, 2012, 09:06 PM
S' TSO if u have time can u help me in GLO thanks!


TSO

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Reply #193 on: Feb 23, 2012, 06:11 AM
Quote
As I know Petron has an excellent credit rating (AAA) according to PhilRating.. Then this clear up my mind to put my money to them..

Jawo, do not rely 100% on credit rating agencies. If there's anything the 2008 subprime crisis had taught us, it's that they are not infallible.

For all you know, Petron could've given Philrating a lot of money for their AAA grade.

Quote
I'm investing with SMPH for a quite some time now.  Earnings like 27% now, i saw the rate in CITISEC that their recommendation is to sell at Php 20 per unit.  My question is whats the BUY BELOW rate of SMPH?

I wouldn't know.

Quote
Nag request ako ng analysis mo sa EDC dati. Pero di ako kaagad bumili. Buti na lang at medyo bumaba. So bumili na ako.

Kung may time ka baka pwede pa analyze din ng Philodrill Corporation (OV). May Konti ako nito. Sa .032-.033 ko nakuha. Medyo ok naman ang gain. Di ko lang alam kung kelan maganda bumitiw. Ang target ko ay around 0.06.

robot.sonic, I'm starting to get interested in it, actually.

I've been watching TFC (Filipino Channel) lately, and I've noticed that every time the little bar thing that shows executed trades show something, I've seen OV pop up quite a bit, along with WIN and some other companies. (along with the stuff I've already invested in lol).

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S' TSO if u have time can u help me in GLO thanks!

Globe?

You don't need my help. Figure out what exactly their business is. I'm very sure it's not limited to phone subscription plans and Internet services. You're going to need to know this if you want to understand it.

@ All

Just want to post here so everyone knows THAT I AM NOT DEAD and AM STILL HIGHLY ACTIVE.

The thing is, for the past two months, I have been working on the hardest, most complicated company I've ever analyzed and it's currently in the last step of the risk assessment phase (which is followed by the valuation phase, and believe me, creating a valuation matrix takes less than a day).

My next Deep Scan report is coming up soon and, to be honest, I don't know how I'm going to write it because the things I did to investigate its investmentworthiness is complicated in itself. Even more than what I did for EEI.

Besides that, I've been investigating the Euro crisis and all I can say about it is BE PREPARED. Be VERY prepared. The debt crap that's happening over there as I write this (and as you read this) is a result of cultural illnesses and optimism towards human nature. They are not doing anything to solve the fundamental problems and the austerity measures are so unpopular with the public it is evident that a deep disconnect exists between politicians and their constituents (ah, doesn't THAT sound familiar?).

Sooner or later there's going to be an implosion. Until there is overwhelming political will, a miracle is almost unlikely. (So the lesson there is, don't be all in! Always keep some cash on hand just in case.)

As for requests / next projects,

GMA or ABS-CBN is going to have to take a backseat. My interest in OV is starting to get the better of me, and if I like it enough, I might just turn it into a Deep Scan. On top of that, an investing convention I attended just last weekend handed me my next big USA project on a silver platter (because of the high 0.9 beta, attractive fundamentals, and insufficient powerpoint presentations).
« Last Edit: Feb 23, 2012, 06:15 AM by TSO »


bauer

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Reply #194 on: Feb 23, 2012, 11:15 AM
TSO,

why is it so that you consider 0.9 beta as high?  what is your acceptable beta range before you invest?

I just recently invested on a firm with a beta of 0.5 and likewise invested on another one last year with a beta of 1.7

of course, in my decisions, beta alone is not the trigger point.


 


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