The Weekly Roundup – Academy’s Finest is a collection of my favorite blog posts, podcasts and other useful contents that I have enjoyed over the past week.
I will be releasing this series of posts with a short summary of the content for easy summary.
My goals is to share quality content (or what i think are amazing stuff) in an easy to digest format for my readers.
In the meantime, I will also like to pay tribute to these wonderful content creators all around the world, not just here in Singapore.
Please share any great blog posts or podcast episodes with me through the comments section. I value your input and feedback which will in turn allow me to share the most beneficial content.
Without much ado, let’s get started into the Weekly Roundup – Academy’s Finest Vol 5
MY BLOG POSTS THIS WEEK
4 Recession-Proof US Stocks in my Watchlist. We highlighted 4 recession proof US stocks that is currently in our watchlist. These 4 stocks are McDonald, Autozone, McCormick and Church & Dwight. We provided the past 10-15 years financial highlights of these stocks as well as comment why these stocks tend to be recession-proof. We have previously done a Buffett analysis on McDonald and provided our input as to what the ideal entry price might be. While we like all 4 stocks as ideal candidates to consider in an economic downturn, their prices currently do not yet warrant an entry. Church & Dwight recently announced its 3Q19 results yesterday which disappointed the street in terms of forward guidance. Stock was down 7%. Is there value now at current level? We could be doing a Buffett-style analysis on it soon.
Valuemax: A Recession-Proof Stock but we see 1 MAJOR risk. Valuemax is a SGX-listed small cap stock that we believe has a recession-proof business model. Most will be familiar with its pawn broking business as their pawnshops are generally “plastered” across heartland malls. However, one might not be aware that it has been operating a money-lending business since late-2014. This segment has been the key earnings driver for the company and we believe Valuemax’s business model as a whole has strong features which will allow the company to thrive if the Singapore economy goes into a recession. However, we do see one significant risk pertaining to its unsecured lending segment and we highlight this key risk in the article.
Sheng Siong 3Q19. 4 Key areas to look out. The company announced 3Q19 results that was above market’s expectations, with earnings up 16% vs. market expectations of approx 8% YoY growth. This resulted in its share price appreciating by 4% post results, with most analysts in the street maintaining their bullish stance on this defensive counter. With 3 new additional stores secured in the last quarter, bringing YTD new stores to 6, this adds to the revenue/earnings visibility for 2020.
Riverstone 3Q19 Preview: Potential to Surprise? The company will likely be announcing its results after market hours on 1 November. We believe there is a scope for earnings outperformance, given the relatively low base last year as well as improving business fundamentals. We highlighted a number of key trends such as 1) US tariffs on China glove products giving Malaysia glove manufacturers a boost, 2) Recovering demand for Nitrile gloves, 3) Stronger USD vs. MYR providing a boost to Malaysia manufacturers margins etc. While forward earnings growth might not be spectacular, Riverstone is currently trading at a decent PER multiple of 17x that could see some re-rating if earnings surprise on the upside.
BLOG POSTS
- The Story of One Sibei Old Ship by Investmentmoats
The topic on Eagle Hospitality Trust has been a very popular one. The stock collapsed when it was highlighted in an EDGE article that one of its key hospitality property, a pretty run-down ship called The Queen Mary, is in serious need of some refurbishment and the cost is not going to be cheap. Kyith from investmentmoat provided a pretty detailed explanation of the situation and how things might pen out. While i am no expert on REITS, i personally do sense that there might be quite a fair bit of risk involved, notwithstanding the attractive yield. Did EHT buy a dud? Does it have the necessary capital to re-develop the land area around the ship? Did management do a proper risk assessment in the first place? These are the initial questions that come to my mind.
- Warren Buffett Says you do not need an Emergency Fund by Mr Free At 33
The headline basically caught my attention. What! The greatest investor on Earth is saying we do not need an Emergency Fund? How does that gel with all the advice that we have gotten from Personal Finance gurus about keeping an Emergency Fund of at least 3-6 months of your expenses? Is that not relevant? Well apparently that situation only pertains if you are already into your retirement years. For those still pursuing FIRE, having an emergency fund is still a relevant thing to do. Read more to find out about the details.
- How to start Investing in your 20s by SmallCapAsia
James from SmallCapAsia shared that the best time to start investing is ASAP. While we are still young, we should be looking to grow our investment portfolio through a variety of investment assets at our disposal such as stocks and bonds. We could choose beginner-friendly options such as robo-advisors, target-date mutual funds, index funds etc. Bottom-line: Start your investment journey as soon as possible to ensure that you can reach your retirement goals earlier than later.
WRAPPING IT UP
That’s all for this edition of Academy’s Finest. Have a great week ahead everyone!
