Formation of a beautiful mini double saucer chart ?

Bottom 0.65  & Top 0.80 ???

Time is the game for TDM.?? Time Develop Money !!!  Small & safe profit - another tasty durian???

With the bonus issue of 1:10  & 0.5 cent dividend , will the chart fail ! ?

http://kongsenger.blogspot.com/2019/12/tdm-2054-rm0335.html?m=0

http://kongsenger.blogspot.com/2019/12/tdm-2054-16122019.html?m=0

http://kongsenger.blogspot.com/2019/12/2054tdm-24122019.html?m=0

too late dy, cpo heading down again, but healthcare to pickup...always one up and one down...wud be good if both sectors up together.

For many years, BPlant tried to improve its bottom line. But the acquisition of BPlant by KLK suggests that the value of plantation companies lie in the assets rather than the earnings power. By this metric, TDM is undervalued. For many years, TDM like BPlant tried to improve its earnings from the plantations. Looking at BPlant wouldn't it be easier to dispose of the estates and pump it into healthcare?

If you compare TDM market price over the past 10 years with that of its ROE, you can see a great disconnect as illustrated in the chart

The share price had declined to its low in 2019. Over the past 5 years it has not really gotten out of the low. While the ROE had improved since the 2019 low, the market price did not seem to reflect this.

But its financial performance as measured by the ROE has been volatile compared to the market price.  

Does it mean that there is an investment opportunity? From a fundamental perspective I would still compare its intrinsic value with the market price before deciding whether to invest.

Both the plantation and healthcare are not sunset sectors. If you want to know more about the plantation sector, go to “How the Malaysian plantation sector performed over the past 10 years”

Professor Bruce Greenwald opined that you can get strategic insights by comparing the asset value (AV) with the earnings power value (EPV) of a company.

In a very competitive environment would have the AV = EPV ie the assets have been well deployed to generate profits. If a company has a strong economic moat, you would expect EPV to be much greater than the AV. If you have a case of the EPV being much smaller than the AV, you have under-utilized assets.

In the case of TDM, a Bursa Plantation company, the AV is RM 0.40 per share. But its average earnings over the past decade was negative. The EPV can be thought of as zero.

This is clearly as case of under-utilised assets. Many would hold the Board and management accountable. Maybe the company should take a leaf from the sale of Boustead Plantation where the Revised Asset Value is about double the Book Value. But was sold at a price that is a bit higher than the Book Value.

So isn’t it better for the shareholders of TDM if its assets were sold and monies returned to shareholders. Why work hard for 10 years to have negative average earnings? Maybe then the shareholders could reinvest in other better plantation companies.

Of course, you could argue that looking at historical earnings is not a good reflection of the future. And it is not the full story and TDM has a healthcare arm in addition to its plantation arm.

Can we buy now?  The price is try to break d roof wit high volumes 

i think can buy compare to the peer like THp.

TDM – bigger does not mean better

TDM  has 2 business segments – Plantation and Healthcare. In 2007, TDM expanded its plantation business to Kalimantan Barat, Indonesia and touted “…that the growth of the plantation operations will be in Kalimantan.”

By 2016, the Group’s Indonesian assets amounted to RM 532 million. But then things began to go wrong with the company having  to incurr impairments from 2016. It got so bad that the Group decided to sell of the Indonesia assets in 2019. By this time, after all the write downs, its Indonesia assets was reported to be RM 106 million.

Without the Indonesian operations, the Plantation segment is a profitable one. The Healthcare segment, although a small player in the Malaysian healtcare sector, has always been profitable. Let us hope that maybe the company will start making money by just running its operation better rather than try to be bigger