LabroyMar   

Look out for this stock

The date is 6 Nov 2006

 

Tomorrow is a very important day in the progress of this stock. From indications on an olde-style TA chart, it is evident that it has arrived at a point where a 'decision' will be made. But it is rather hard to tell which way prices will head from here in the coming weeks. Much will depend on the price action tomorrow. 1.81, which is today's closing for this stock, will be the reference point. Any change in price from this reference point of 1.81 is significant. If its opening registers 1.81, one still needs to wait to see in which direction prices will go. If it heads downwards ie. to 1.80/1.79, that is can be the beginning of  a downward move in the coming weeks. If it moves upwards from 1.81, ie. to 1.82/1.83, chances are  good  it will head in that same direction in the coming weeks. This is why tomorrow, Wed 5 Nov 2006 is  so important.

 

singaporegal,

thanks

 

Sorry, hit the wrong button. Lets start again.

FA on Labroy



Labroy has 4 core businesses:

1. Shipping - buoyant in 2005 but flat in 2006.
2. Ship/Rig building - buoyant in 2005 and 2006. Healthy backlog
3. Ship/Rig repair -        -------ditto--------
4. Others - Precision machining company - supporting the electronic industry. Turned profitable since 2005  contributes < 5% to the bottomline....not significant.

Current price - $1.81

NTA - 30 Sep 06 - 34.22cts

EPS -  FY 2005 - 6.58ct-------YTD 2006 - 6.5ct.

Forecast EPS FY 2006 - 8.5cts (est)

P/E  - based on Fcst 2006 - 21.3x

Div - 2005 - 2.2cts------2006 (fcst) - 2.8 to 3.0 cts.

Yield - based on fcst 2006 - 1.55% (not generous)



With P/E  at 21.3x, seems abit pricey to me unless there is growth potential in the next few years.

Take a look at 2006 Q on Q eps

      1Q                  2Q                3Q            4Q

     2.27cts           2.0 cts            2.23cts       2.3cts?..=> no growth



From the above data, it seems that Labroy is facing the same capacity problems as other cos in this industry. see my threads on 'Sembmar - collapsing margins'. In this case, I think their constraint is more due to lack of suitable manpower rather than yard space (they've got lots of space in Batam.).



Conclusion - In my opinion, this counter is fully priced at this level....unless mgmt is able prove they can increase output or there is an upturn in the shipping business in 2007.

 

Hi shplayer,

Regarding your TA on this, I read the bollinger bands to be very tight. Sudden price change might happen soon. Direction of change can be told by other charts like Acc/Dist, Chaikin and RSI. Seems like there's a bias towards the south direction.

BTW, I don't use MAs because they're a lagging indicator.

 

Labroy has 4 core businesses:

 

1. Shipping -

 

Hi shplayer

Many thanks for the willingness to do an FA on this counter.  I have noticed that its price has been heading north these past few months.  As I have missed out then, may want to buy/hold if the fundamentals are really good.  Right now I feel the price is rather steep, and unless the FA and TA shows otherwise, I may wait awhile longer before entering.

Hope your analysis comes in this week as I will be away the whole of next week.  Much appreciated.

 

Thanks!

 

hippoo,

This counter not on my radar screen....but will do an FA and let you know in a day or so.

 

Hi shplayer,

Since you are a FA expert, can you also comment on the FA for this stock. Personally, i feel that the marine industry is still doing well.And LabMarine has been winning contracts over the last few rounds. For medium to long term, can keep this stock.

 

From the charts, in my novice TA opnion, I think its more likely to trend down in the short term because:

1. Prices are in the mid to lower half of the Boll band (BB)
2. The lower envelope of the BB seems to be trending down whilst the upp envelop is flat.
3. RSI still downtrend,
4. MA7 continues to trend further below MA14

Appreciate opinions from TA gurus.

TKS

 

From TA point of view, the Bollinger bands are really tight, chaikin is slowly moving up. Acc/Dist although low, may be turning. If it burst with good volume and with price going up, can consider.