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BAT - A BUY at below 250
Rank: Veteran Joined: 5/24/2010 Posts: 846 Location: KENYA
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At 245 its a buy as a value stock. Check this out Price to buy= ((year high-year low)*40%)+ year low) Therefore for BAT, Best price to buy is = ((300-196)*40%)+196) = 237.60 Today's price= 245 Difference= 3% This screams BUY to me. The only issue is whether all these fake cigarettes in the market will mess up the beautiful dividend policy of this stock. I now await opinions,suggestions or just regular bashing. 
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Rank: Chief Joined: 1/13/2011 Posts: 5,964
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Yawn...yet another senior citizens investment. Buying BAT made sense in 2009 @130*
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Rank: New-farer Joined: 6/3/2010 Posts: 96
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The Merchant wrote:At 245 its a buy as a value stock. Check this out Price to buy= ((year high-year low)*40%)+ year low) Therefore for BAT, Best price to buy is = ((300-196)*40%)+196) = 237.60 Today's price= 245 Difference= 3% This screams BUY to me. The only issue is whether all these fake cigarettes in the market will mess up the beautiful dividend policy of this stock. I now await opinions,suggestions or just regular bashing. You just took the words out of my mouth...when i saw the 245 price...just started salivating...only issue is that finished liquidity entering KPLC...dont think that price will last for long....
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Rank: Veteran Joined: 5/24/2010 Posts: 846 Location: KENYA
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Papa Investor wrote:The Merchant wrote:At 245 its a buy as a value stock. Check this out Price to buy= ((year high-year low)*40%)+ year low) Therefore for BAT, Best price to buy is = ((300-196)*40%)+196) = 237.60 Today's price= 245 Difference= 3% This screams BUY to me. The only issue is whether all these fake cigarettes in the market will mess up the beautiful dividend policy of this stock. I now await opinions,suggestions or just regular bashing. You just took the words out of my mouth...when i saw the 245 price...just started salivating...only issue is that finished liquidity entering KPLC...dont think that price will last for long.... No it won't. The fund managers love this one and they will mop it up at this price leaving the rest of us calling it a senior citizens stock. @cde mono....this stock has grown in value since its 130 days. Its like me saying I wont buy KCB at 24 since some months back it was valued at 17/-....Its not about price, its about value. Lets discuss that. 
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Rank: Veteran Joined: 5/24/2010 Posts: 846 Location: KENYA
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Oh and a quick one, its trading at an RSI of less than 30. If you follow the last 3 yrs trend, everytime this stock hits the 30 RSI mark it bounces right back up....wenye pesa nunueni I sing again.
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Rank: Member Joined: 12/15/2010 Posts: 162
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The Merchant wrote:At 245 its a buy as a value stock. Check this out Price to buy= ((year high-year low)*40%)+ year low) Therefore for BAT, Best price to buy is = ((300-196)*40%)+196) = 237.60 Today's price= 245 Difference= 3% This screams BUY to me. The only issue is whether all these fake cigarettes in the market will mess up the beautiful dividend policy of this stock. I now await opinions,suggestions or just regular bashing. @The Merchant, where is this formulae from and does it work for other stocks?
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Rank: Veteran Joined: 5/24/2010 Posts: 846 Location: KENYA
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@investor. Sorry to sound vague but I read it somewhere last yearon the net and apparently WB uses it. Now its only used to establish the best price to buy a stock which you have already decided would be good to hold. It helps to determine the entry point of an already favoured stock. Most investors use a more lenient percentage such as 60% in the formula. I only used 40% because WB uses that. Its a more prudent %. Ill look up the article/source and hit you up soon. In the meanwhile, read up on margin of safety. You will unearth even better formulas and ideas. All the best.
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Rank: New-farer Joined: 1/8/2011 Posts: 48 Location: muranga
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The Merchant wrote:Oh and a quick one, its trading at an RSI of less than 30. If you follow the last 3 yrs trend, everytime this stock hits the 30 RSI mark it bounces right back up....wenye pesa nunueni I sing again. Placed my buy order last night @ 255 which went through,wish I waited little longer.
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Rank: Veteran Joined: 12/23/2010 Posts: 1,229
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The Merchant
what does the 40% represent?
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Rank: Chief Joined: 1/13/2011 Posts: 5,964
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@Merchant..i see our divergence. U r talking value n i'm talking business growth. To be clear..I WOULDN'T BE CAUGHT DEAD in SCBK, BAT or BBK (unless their prices crash with no relation to fundamentals like in 08/09). Why? I am young...and these companies have reached their peak in my reasoning. KCB, EBL, Coop...that's where u'll find me for a long time (they can reach their peak when I have reached my peak) hapana OTW.
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Rank: Veteran Joined: 5/24/2010 Posts: 846 Location: KENYA
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For Sport wrote:The Merchant
what does the 40% represent? Margin of safety. The lower the percentage the more risk averse one is. I use 40% like the oracle of omaha (though rarely, BAT just fit this formula sooo well)
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Rank: Veteran Joined: 5/24/2010 Posts: 846 Location: KENYA
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Cde Monomotapa wrote:@Merchant..i see our divergence. U r talking value n i'm talking business growth. To be clear..I WOULDN'T BE CAUGHT DEAD in SCBK, BAT or BBK (unless their prices crash with no relation to fundamentals like in 08/09). Why? I am young...and these companies have reached their peak in my reasoning. KCB, EBL, Coop...that's where u'll find me for a long time (they can reach their peak when I have reached my peak) hapana OTW. never dismiss a stock. We are here to make money not vote favourites. I dont exactly run for BAT but it looks good at current prices thats all. Even co-op will be good after rights I think.... Ofcourse BAT as a company may experience slower growth than the companies you just mentioned but it holds very well when the sky falls ...like closer to 2012 when we chose the next robbers to represent us. I still say BUY.
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Rank: Veteran Joined: 12/23/2010 Posts: 1,229
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The Merchant wrote:For Sport wrote:The Merchant
what does the 40% represent? Margin of safety. The lower the percentage the more risk averse one is. I use 40% like the oracle of omaha (though rarely, BAT just fit this formula sooo well) Thanks!! see, everyday I learn something new..
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Rank: Veteran Joined: 5/24/2010 Posts: 846 Location: KENYA
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maskana wrote:The Merchant wrote:Oh and a quick one, its trading at an RSI of less than 30. If you follow the last 3 yrs trend, everytime this stock hits the 30 RSI mark it bounces right back up....wenye pesa nunueni I sing again. Placed my buy order last night @ 255 which went through,wish I waited little longer. 255 is the price my order may go through at.  Fingers crossed. Never mind 255 though, thats a 6% dividend yield you just got yourself, better than banks I tell you.
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Rank: Chief Joined: 1/3/2007 Posts: 18,223 Location: Nairobi
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I do not use [or support] BAT products but I like the dividend yield! Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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Rank: Chief Joined: 1/13/2011 Posts: 5,964
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VituVingiSana wrote:I do not use [or support] BAT products but I like the dividend yield! In other words my lifestyle choice sustains you. We are great buddies.
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Rank: Chief Joined: 1/3/2007 Posts: 18,223 Location: Nairobi
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Cde Monomotapa wrote:VituVingiSana wrote:I do not use [or support] BAT products but I like the dividend yield! In other words my lifestyle choice sustains you. We are great buddies. Do you have any idea how many families I support from my habit of swimming in Tusker??? Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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Rank: Chief Joined: 1/13/2011 Posts: 5,964
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VituVingiSana wrote:Cde Monomotapa wrote:VituVingiSana wrote:I do not use [or support] BAT products but I like the dividend yield! In other words my lifestyle choice sustains you. We are great buddies. Do you have any idea how many families I support from my habit of swimming in Tusker??? & the many roads we've financed & civil servants we've paid!!
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Rank: Elder Joined: 9/23/2009 Posts: 8,083 Location: Enk are Nyirobi
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The Merchant wrote:At 245 its a buy as a value stock. Check this out Price to buy= ((year high-year low)*40%)+ year low) Therefore for BAT, Best price to buy is = ((300-196)*40%)+196) = 237.60 Today's price= 245 Difference= 3% This screams BUY to me. The only issue is whether all these fake cigarettes in the market will mess up the beautiful dividend policy of this stock. I now await opinions,suggestions or just regular bashing. @merchant hold on to your cash. BAT was overpriced under its standards, and due for a correction. Three things are not going well for the share currently. 1. Industry issues like counterfeits and claims of favouritism for MTK 2. Budget round the corner and excise on cigarretes expected to go up 3. The general bearish sentiments because of 2012, arab crisis, oil prices etc. BAT has 2 distinct classes of shareholders: the institutions and the small time retailers. The institutions rarely sell, preferring dividend pickings while the retailers are more likely to react to factors such as above. The retailers have started reacting and the fall in price will only fuel the negative sentiment, causing further drops. The daily volumes rarely exceed 500 shares at such times. In conclusion if you want to pick small volumes, just wait as the retailers offload. I think 200 is possible during the year. Life is short. Live passionately.
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Rank: Elder Joined: 2/10/2007 Posts: 1,587
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sparkly wrote:The Merchant wrote:At 245 its a buy as a value stock. Check this out Price to buy= ((year high-year low)*40%)+ year low) Therefore for BAT, Best price to buy is = ((300-196)*40%)+196) = 237.60 Today's price= 245 Difference= 3% This screams BUY to me. The only issue is whether all these fake cigarettes in the market will mess up the beautiful dividend policy of this stock. I now await opinions,suggestions or just regular bashing. @merchant hold on to your cash. BAT was overpriced under its standards, and due for a correction. Three things are not going well for the share currently. 1. Industry issues like counterfeits and claims of favouritism for MTK 2. Budget round the corner and excise on cigarretes expected to go up 3. The general bearish sentiments because of 2012, arab crisis, oil prices etc. BAT has 2 distinct classes of shareholders: the institutions and the small time retailers. The institutions rarely sell, preferring dividend pickings while the retailers are more likely to react to factors such as above. The retailers have started reacting and the fall in price will only fuel the negative sentiment, causing further drops. The daily volumes rarely exceed 500 shares at such times. In conclusion if you want to pick small volumes, just wait as the retailers offload. I think 200 is possible during the year. What is the ownership structure of BAT? Free float?
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BAT - A BUY at below 250
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