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Dayang: devious tricks to buy at cheaper prices

KYY Golden rule for share selection:

The company must report profit growth for 2 consecutive quarters before I decide to buy it. Moreover, it must be selling below PE 10.

Among all the criteria such as NTA, Cash flow, dividend yield, debts, liabilities, cash in fix deposit, profit etc profit growth prospect is the most powerful catalyst to move share price.

On 28 Feb 2019, when I saw Dayang reported its 4th quarter EPS 10.13 sen and its 3rd quarter EPS 5.05 sen I started to buy at 60 sen per share. Its highest price was Rm 1.71 on 15 March. It has gone up 285% in less than 2 months.

I have posted the following buy recommendations which you can see on my blog: koonyewyin.com or on i3investor.com namely:

1 Dayang: when did I start to buy

2 Dayang: Flight delayed by KWAP

3 Dayang: flight path is clear

4 Dayang: what is my target price

5 Dayang: rapid rise defies gravity

In my article namely “what is my target price”, I wrote the following:

Acceleration of Profit Growth 

Dayang’s EPS for the last 4 quarters were -2.21, 4.03, 5.05 and 10.13 sen. Based on the following facts:

  1. Secured 5 new contracts as mentioned above.
  2. Accelerated rate of increase in profit.
  3. No more delay by monsoon.

It is most likely that its EPS for the coming quarter will be higher than 10.13 sen.

It is safe and conservative to assume that the company can make the same profit of 10.13 sen per share per quarter, in the next 4 quarters for financial year 2019. That means its annual EPS will be 40 sen.

Based on P/E 10, the share price should be 40 X 10= Rm 4.00

I strongly believe my target price of Rm 3.00 is easily achievable. 

Coming quarter profit announcement

Many people are eager to see Dayang announcement for the next quarter result before end of May 2019. What will be the share price if its profit is higher than the previous quarter?

I have been watching the trading of Dayang almost every minute and I can see how big buyers use their buying technic to buy at cheaper prices. For example, when they want to buy, say at Rm 1,70 sen they would place 1.2 million shares to sell at Rm 1.71 and 1.5 million shares to sell at Rm 1.72. By this way they can buy a lot of shares. Big institutional investors are responsible of the daily volume of tens of million shares. I have seen 150 million shares changed hands in 1 day.

Many of my followers have followed me to buy Dayang and a few asked for my opinion on Kenanga’s down grading report which was published yesterday. As a result, many weak shareholders sold causing the price to drop 9 sen per share.

You must bear in mind that the price correction in the last few occasions have been very small. After dropping a few sen it shot up 18 sen on 3 occasions with huge volumes.

Conclusion: Unless the author, editor, directors and Kenanaga Investment Bank can confirm that they do not have Dayang share, I will not believe the published article is not another skilful use of underhand trick to buy Dayang at cheaper prices.       

 

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