Bad journalism from The Irish Times - Tuesday, June 12, 2012
http://www.irishtimes.com/newspaper/fina...52979.html [Full Article].


Extracted and translated from the ZB article (recently interviewed Mr Ren) below:


“In FY2011, Yangzijiang declared 5.5 Singapore cents of dividends, which would translate into some S$55 million in dividends for Mr. Ren YuanLin based on his shareholding in Yangzijiang. What was pleasantly surprising is the fact that he has pledged this amount, together with all future dividends to be received from his 26% stake in Yangzijiang, into  the Yuanlin Charity Foundation.”

BOA Merill Lynch had such a bullish report a few days ago and target price of $2.12.

ASL MARINE target raised, YANGZIJIANG has 70% upside?

Nomura is at the other extreme as the report here shows. It's only because Nomura 'fully discounts" YZJ's held to maturity investments. Rather strange in my view. So Nomura's TP is only 74 cents. Aiyah, this sort of price level will not be re-visited again.

For what it is worth:


Action: Downgrade to Reduce, TP at SGD0.74 We like Yangzijiang (YZJ) for its proactive approach in securing new contracts. However, we remain negative on the overall commercial
shipping industry outlook and YZJ’s shrinking margins and orderbook. We think the share price has out-run itself and should correct to more accurately reflect the non-positive shipbuilding outlook. As such, we downgrade to Reduce with a price target of S$0.74

Catalyst: Newbuild pricing weak, demand to be lacklustre Recent new orders won by YZJ were done at an average price of US$28m. We estimate that a similar order would have fetched an average of US$35m previously. This is reflective of a poorer pricing environment.

Our shipping analysts expect the container segment to suffer further losses in 2012 and BDI levels to remain at loss-making levels. As such, we think that newbuild demand from vessel owners will be low. We believe that YZJ will continue to win orders but at the expense of margins. Due to falling new orders and shrinking margins, revenues and profits from the core shipbuilding segment are expected to shrink. However, earnings will continue to be held up by non-core investment income and other gains which are coming in higher than expected.

Valuations

We continue to value YZJ solely as a shipbuilding business on a SOTP basis, while fully discounting its HTM investments, which were worth S$0.55/sh as at end-2011. YZJ trades at FY12F/13F P/Es of 7.2 / 10.0x which are at the mid band of its historical range (P/E range of 3.7 / 13.3x).

Hope you didn't missed it. YZJ has sailed up to nearly double yr price at $1.40 currently.

I was just checking back on what has been said & reported in the past. Came across this article Oct 2011:

YZJ turned out to have done well in its share-buyback --  purchased 1,000,000 shares at $0.89. And as the share price continued to plummet, bought back another 2,000,000 shares at $0.84.

The stock now at $1.36, up nearly 60% in 5 months.

Who were the sellers at those prices? Panic - sellers when the world was all gloom & doom. U gotta pray for another crisis to buy at such levels.

sunnyday, what is your target price?
This morning, YZJ delivered a good set of results -- and 5.5 cents in dividend, up from 4.5 cents last year. It doesn't sound like a S-chip at all... LOL

Today, Credit Suisse had a report making some forecasts about the upcoming FY2011 results. This is the line that caught my eye :

"Yangzijang is one of the cheapest stocks in Singapore market on P/B relative to ROE. The stock is currently trading at 2012E P/E of 7.2x, below its historical average of 12x. We maintain our OUTPERFORM rating."

Ok, let's see what happens when YZJ delivers report next week.

ya, read the news already. the stock price is going up now. it won 206.2million so far this year. the group is now securing orders for 2013 and beyond!!!doing quite well.

CITIGROUP report: YZJ has consistently surprised with a stronger than expected set of results. However, the contrasts in margins between pre-2008 and current new build ships suggest 2012 earnings will continue to be very strong while outlook beyond 2H13 remains uncertain.

This has depressed the stock valuation multiple. In view of the strong 9M FY11 profit, we raise our 2011 estimates by 17% but leave 12-13E estimates relatively unchanged. Our new target price is S$1.20 as we reduce the shipbuilding valuations in our SOTP valuations.

Yangzijiang’s quarterly earnings crosses billion mark and at record high of RMB1.02 billion for 3Q2011

* Earnings grew 40% in 3Q2011 with more of higher margin vessels delivered and 156% growth in other gains

* Revenue up 12% to RMB3.46 billion in 3Q2011 as the Group delivered total of 19 vessels against 14 vessels in 3Q2010

* The order book stood at 114 vessels worth US$5.3 billion as at 30 September 2011

Stock is in tight trading range 90 cts -$1. Closing price on Friday was 95.5 cents. Weak shipping rates have dampened sentiment for shipbuilders like YZJ.

97 cents now! Goes to show that the market can be over-fearing about something that is insignificant. Business Times article recently has just jumped on the bandwagon.

Singapore-listed Yangzijiang Shipbuilding  <YAZG.SI> in focus after the company addressed investor concerns about its exposure to informal lending and corporate failures in China.

 Yangzijiang said to date, it had invested around 247.5 million yuan ($38.8 million) in two  micro-financing entities,  which accounted for less than 3 percent of the group's net tangible assets as at June 30. The company has not experienced any default of its investments in financial assets since 2008, it added.

+4.5 cents now to 93.5 cents. This big fish got away from me.... sigh

'Average down YANGZIJIANG', 'buy BIOSENSORS, LIAN BENG'

The AmFraser analyst who urged investors to average down on YZJ just 1 week ago deserves a pat on his back. Now, YZJ is 91 cents.

The share buyback program by the company definitely build confidence for investors. Therefore, a 10% increase is not a surprise.

However, SIA or Ho Bee who have been doing share buybacks, it only brought temporary relief to the share prices. Right now, both companies's overall share buybacks are higher than the current prices. Though, do note that SIA did some share buybacks at below 11 dollars.

up up and away....87.5 cents now! Why? Have investors suddenly felt convinced of the Held-to-Maturity investments of YZJ? I doubt it. Instead it is all about sentiment and the herd mentality. Suddenly, everybody is riding the horse of YZJ to profits. And the shortists have abandoned shorting YZJ

4 days and, on hindsight, anyone could have made 10% on Yangzijiang by buying at 77 and selling at 85.5 cents now!

On hindsight.... sigh.... that's always pefect vision

On hindsight, 77 cents was a good entry point. Closed at 80 cents yesterday SSsssssh. Today should be firmer, 85 cents?, cos of good Dow closing overnight.

77 cents .,..another 7 cents to go.
Can buy at 70 ?

Worth a punt?