Tiger Air

Prospects still bright despite hiccup

Tiger Airway’s stock price reacted to two pieces of news yesterday: (1) A
pilot shortage resulting from industry poaching due to the strong rebound
in the airline industry and; (2) Its CEO and two substantial shareholders
(Indigo and Ryanasia) placing out 65.8m shares at S$1.90/share to a “broad
base of institutional investors”. We are factoring in a 4% increase in
staff costs that will reduce our FY11 and FY12 EPS estimates by 3.7% and 3%
respectively. We are also ascribing a lower P/E multiple of 16.5x
(previously 18x) to FY11 EPS to account for the current negative sentiment
arising from the pilot issue. This brings our new TP to S$2.13 (previously
S$2.45). Maintain BUY.

Pilots poached due to strong industry rebound. It was reported in The
Straits Times that Tiger had to cancel 10 flights over the past four days
due to a shortage of pilots with 20 pilots being poached since June by
other airlines. We understand that during an industry rebound most full
service carriers will tend to poach their staff from the low cost carriers
amid their own capacity expansion, while the LCCs will hire the fresh
graduates. With aggressive hiring in the airline industry, we have
factored in a 4% increase in staff costs.

Operationally sound; brighter prospects in Australia. We note that Tiger’s
operating statistics in July remained strong with 0.52m passengers being
carried (+42% YoY) despite the report that its pilots left in June. We
expect 6.95m passengers for FY11 and as of July, 2.5m passengers (36% of
forecast) were carried. In Australia, Virgin Blue has announced that they
intend to re-direct their focus to the higher end business class travelers
paving way for Tiger to gain more market share in the lower segment.

Thai Tiger likely to go ahead. Thai Airway’s EVP Chockchai Panyayong was
quoted in The Edge saying that the national carrier will review its
alliance with Tiger following the share sale but “if the selloff has no big
impact on management or the shareholding structure (of the JV), Thai Air
will go ahead.” Tiger’s management has revealed that they intend to proceed
with the JV as agreed upon with Tiger’s CEO Tony Davis and Ryanair’s
principal Declan Ryan sitting on Thai Tiger’s board.


Maintain HOLD with target price $1.95 (from previous post)


Source: UOBKH

Recently Declared Dividends

 

Source: UobKH

Investor's Personalities

Our attitudes toward investing are as distinct as our fingerprints. They start taking shape when you think of money, way before we first start to invest.

When we focus about investing or managing our finances, we'll think from our past experiences. Our inner psychology become critical in preparing us to be a better investor. Moreover, our brains are often wired to project the past into the future; e.g. 'this stock has been going up this far, and will continue to go up and further up', as we all know, this is not the truth.

These investing personalities types may help you to realize your strength as an investor:

• Reserved Investors - The average and ordinary investors. E.g. small business owners and blue to white collared employees.
•  
• Herd Investors - First timers or beginners. E.g. self-employed or professional employees.
• Hard Headed Investors - Seasoned Investors.

• E.g. Seasoned long term investors or short term traders, or part time traders with several years of trading experience but with mixed performance.

• Laid Back Investors - High socialite investors. E.g. high net worth individuals who comprise of lawyers, airlines pilots, doctors, politicians, celebrities and business owners with lot of cash on hand.

• Speculative Investors - Syndicate and professional investors.

• Egoistic Investors - Professionals with scientific or technical backgrounds. E.g. doctors, engineers and airline pilots. Others include professionals fund managers, ex-stock market dealers/remisiers, veteran investors and retired investors.

• Opportunistic Investors - Experienced and professional fund managers. E.g. international and large overseas hedge fund managers/investors who move in and out of the country.

• Discipline Investors - Experienced, professional and high net worth investors and successful traders. E.g. reclusive master investors and full time investors/traders trading for a living.

Attitude and belief to money and investing, can be changed or molded with the right education and mindset. The will to change will overcome all odds.

So, start identifying which type of investing personalities best describe you, choose which type you aim to become, and put in writing what you'll be doing to be one.

Picking a Good Stock

Though there are thousands of stocks in stock market nowadays, not many of them are worth investing. In ever changing business environment, it is not easy for companies to remain profitable.
Worse, hardly any of them have shareholders' interest at heart. That is why, stocks represented by quality companies with effective management team is the key to get a higher investment return

Good stock pick should've consider effective management as it is everything in sustainable stock investment. Thanks to financial ratios, picking good stock is just a simple math away.
Above average EPSGR and excellent ROE is my first stock screening criteria to filter rubbish stocks in the stock market. You can choose any figure which you feel comfortable. But, the figure 10 I chose is because:

• 10 per cent EPS shows that the company has reliable high demand products or services.
• 10 per cent ROE shows that the company are managing shareholders’ fund effectively.
• 5 consecutive years means the company able to survive the ups and down of the market, business cycles or the ever-increasing competition.
• Debt to equity ratio  so that the company has manageable debt during economic crisis.
• High profit margin which shows the management really did a great job in reducing operating cost to maximise profits.

You have to be choosy and determined in selecting which stocks you'll be investing in.
If you love speculative stocks, this method is not for you.

Part Time Investors Tips

With the stock market at historical highs and retail investors getting into the groove, I thought I might as well join in the fun. A common question asked by many part-time investors is how to juggle their investments with their office work effectively without jeopardising either. Here're some suggestions, some tried, some theoretical, some partly tongue-in-cheek in the mood of a lazy Saturday morning, so tread with care (and don't blame me if you are caught with the smoking gun!).

1. Get your boss on your side. Get him/her interested in stocks. Many of them already are anyway, so you don't have to try hard. Once their views on the relative benefits/evils of the stock market are aligned with yours, they will be more lenient towards any minor offences of investing/monitoring investments on the job. They may even look to you for stock tips, hence cementing the win-win relationship.

2. Find like-minded colleagues and find strength in a group. Then you can exchange tips on stocks and on new innovative ways to juggle work and investments. Nothing bonds like sex and money, and if you can't have one, try the other.

3. Outsource monitoring operations to family members. Most often it's the wife, if she's not working. Now, not only are you both bonded by coital relations, you're also bonded by monetary interests. One more topic to talk about at the end of the day.

4. Be careful about using your office computer to check stocks. NEVER use it for online trading. Exception is lunchtime where companies are usually amenable to employee usage of PCs for whatever purposes. Note that the computer audit trail goes all the way to the IT department. If usage for stock market-related purposes is interpreted as overt evidence of using office resources, as well as paid time, to do one's own stuff, then it won't look too good. Not unless it's your ah-kong's company.

5. There are three periods in the day when the time belongs to you. Early morning, lunch-time and after-office hours. (For SAF personnel, insert in morning break and tea break for a total of five). Use them well. Early morning -- check out overseas market performances, and more importantly, read the papers to find out latest fundamental developments/trends. Lunchtime -- review mid-day stock prices and decide whether you want to buy/sell. After-office -- check out corporate developments and overall sector/stock performances, in order to decide possible action for next day.

6. Find a mobile device that enables you to monitor stocks. Check with your broker on what stock monitoring services they provide; they usually do. Don't monitor the stocks (using the mobile device) the office. Make full use of your time. Do it in the pantry when you're getting fresh water supply or in the toilet behind closed doors.

7. A good service to use could be Singtel's I-DEAS News/Finance service. You customise a list of stocks beforehand online; then send an info-requesting SMS everytime you want current quotes on these stocks. The service sends back the required information. Very useful except that it sets you back you 20 cents every time.

8. Familiarise yourself with various stop-loss/limit order options. You could place these orders online the night before or the early morning before going off to work, so that you limit any need for monitoring stocks during working hours. Some brokerages also offer SMS alerts if a stock hits a certain price from above or below. If you're chummy with your broker, he/she might also alert you to certain price triggers from time to time.

9. If one needs to place an urgent order and can't wait till lunchtime or end of the day, call the broker to do a broker-assisted trade. It costs more but don't penny-pinch; it's a matter of 0.1% more commission or so, that's all. Keep your reputation intact, don't use the computer.

10. Turn your weakness into a strength. Your job allows you insider knowledge to a particular industry; look around for new potential stocks in the industry that you know are doing well, in your interactions with your boss/colleagues/subordinates/peers/suppliers/customers. Not only does this confer an investment advantage over fund managers who will not have first-hand industry knowledge, it also makes you alert over time to industry developments and gives you a good overview of how various sub-sectors fit together within the industry you're in. Many companies/bosses fail to appreciate this fact and I genuinely believe that street-savvy employees are of more value to any organisation.

At the end of the day, the name of the game when using office time to undertake your market operations is: Be Discreet. Then you'll be alright. Because everybody does it, believe it or not.

Source: DanielXX

Introduction to Types of Trading.

It's good to know the ABC of trading, including the process of it. Stock market and retail are two different thing, e.g: Stock markets operation are auction-type, where both buyers and sellers are actively setting the price, and retail price are only set by seller.

So how does the stock market price work? Buyers and sellers set the price which is 'bid price' and 'ask price'.

Bid price is the price which buyers are willing to buy the shares. Ask price is the price which sellers are willing to sell their shares. Both bid and ask price are rarely the same, generally the bid are slightly lower than ask price. The differences between both will go to the broker as profit.

There are few types of trading style you can use when it comes to executing your trades. The types of trading are:

Market Orders: As mentioned above, you tell your broker to purchase or sell a specified quantity of stock at the prevailing market price. These are often the lowest-commission trades because they involve very little work on the broker's part.

Limit Order: You tell your broker to buy a security at or below a specified price, or to sell a security at or above a specified price. This ensures that you will never pay more for the stock than whatever price you set as your "limit."

Stop Order: You tell your broker to buy a security at the market price once it reaches a level higher than the current market price. The opposite would be true if you were selling: you would tell your broker to sell your security once it reaches a level below the current market price.

Fill or Kill: You tell your broker to execute the trade immediately; if the trade is not filled right away then your broker does not execute the order.

Day Order: You tell your broker to execute the trade by the end of the day; otherwise, he or she does not fill the order.

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