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Agriculture Stocks - Moto Moto
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VituVingiSana
#121 Posted : Thursday, March 18, 2010 11:28:37 AM
Rank: Chief

Joined: 1/3/2007
Posts: 18,346
Location: Nairobi
@sparkly - At 38/- I would buy as many as possible... and forget about them for a few years!

As @guru says... pipe dream (unless GoK does a mugabe on them)
Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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guru267
#122 Posted : Friday, March 19, 2010 10:25:50 AM
Rank: Elder

Joined: 1/21/2010
Posts: 6,675
Location: Nairobi
mkonomtupu wrote:
Guru, EPS in agric stocks is never a good guide to make decisions.

The next roller-coaster is going to the financials


@mkonomtupu EPS may not be the best indicator of agriculturals prices but it can be a good one...
Because on any counter the EPS can help calculate the downside risk in price and the dividend paid is also in most times directly co-related to the EPS....

talking about the financial roller-coaster... i dont really expect one until the companies start releasing their half year results...
Mark 12:29
Deuteronomy 4:16
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guru267
#123 Posted : Monday, March 22, 2010 11:23:56 AM
Rank: Elder

Joined: 1/21/2010
Posts: 6,675
Location: Nairobi
kakuzi might have stopped its "free fall" demand came through at 75 fairly strong
Mark 12:29
Deuteronomy 4:16
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VituVingiSana
#124 Posted : Tuesday, March 23, 2010 11:43:01 AM
Rank: Chief

Joined: 1/3/2007
Posts: 18,346
Location: Nairobi
85/- is the last traded price... Plenty of demand at 80/-
18,000 shares at 87/- look good... Great P/E & the tea prices have held up well even with increased production...
Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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Scubidu
#125 Posted : Tuesday, March 23, 2010 12:36:34 PM
Rank: Veteran

Joined: 9/4/2009
Posts: 700
Location: Nairobi
@guru267. You ever used an indicator called "Altman Z-Score" (I think it's sometimes called Bankruptcy ratio) on Kenyan stocks.

I read that it's defined as a measure of the possibility of a company becoming insolvent based on five criteria. A ratio greater than 2.67 indicates that the company's liquidity is is good shape. A ratio below 1.87 indicates that the company is well on the way to bankruptcy.

I tried it on some NSE listed companies:
Carbacid 7.330
NMG 5.849
Rea Vip 4.007
EABL 3.504
Sasini 2.892
Kakuzi 2.659
Safcom 2.484
Mumias 2.467
KEnGen 2.136

In the danger zone
ARM 1.604
KPLC 1.653
KQ 1.498

What could it be saying about ARM, KPLC & KQ? For me the indicators shows that they may have working capital constraints and/or high gearing (debt). You agree?
“We are the middle children of history man, no purpose or place. We have no great war, no great depression. Our great war is a spiritual war, our great depression is our lives!" – Tyler Durden
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guru267
#126 Posted : Tuesday, March 23, 2010 1:06:22 PM
Rank: Elder

Joined: 1/21/2010
Posts: 6,675
Location: Nairobi
@scubidu according to that "so called" rating this is how the scores are analysed

Z-SCORE ABOVE 3.0 -The company is safe based on these financial figures only.
Z-SCORE BETWEEN 2.7 and 2.99 - On Alert. This zone is an area where one should exercise caution.
Z-SCORE BETWEEN 1.8 and 2.7 - Good chances of the company going bankrupt within 2 years of operations from the date of financial figures given.
Z-SCORE BELOW 1.80- Probability of Financial embarassment is very high.


i've just tried it out and it seems like total madeness because according to the score mumias, safcom, and kengen are going bankrupt within 2 years and KPLC AND KQ will be insolvent immediately... PLEAAASSSEE GIVE ME A BREAK!!!!

Tis assesment is based purely on company financials and it still doesnt make any sense...


Mark 12:29
Deuteronomy 4:16
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Much Know
#127 Posted : Tuesday, March 23, 2010 1:44:05 PM
Rank: Elder

Joined: 12/6/2008
Posts: 3,579
Hi Z Score kitu kama ni kweli, some of us are going to have sleepless nights. Due to KPLC monopoly e.t.c i would not worry but the rest?
Ras Kienyeji Man
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VituVingiSana
#128 Posted : Tuesday, March 23, 2010 2:58:15 PM
Rank: Chief

Joined: 1/3/2007
Posts: 18,346
Location: Nairobi
@scubidu - I need to read up on it BUT... please use the score on the KQ, etc using financials from 3 years ago... then we can compare...

If KQ flunked it 3 years ago... but it is far stronger now than 2008

I would say KPLC has never been stronger in the past 8 years. What was the Z-score 3 years ago?

Please calculate the scores for us... in 2008
Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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Scubidu
#129 Posted : Tuesday, March 23, 2010 2:59:49 PM
Rank: Veteran

Joined: 9/4/2009
Posts: 700
Location: Nairobi
@guru267. Well I don't think the Z score is completely bogus...there are reasons that KPLC and KQ have low scores....my take is gearing and working capital, which are both crucial indicators of bankruptcy...I think the score helps pin-point these things. But you're right, probably can't apply it in isolation. Don't you think the score spells a warning for a company like ARM, looking to raise money through a bond?

Something interesting u said in a previous post...mentioning using the agricultural EPS as an indicator of dividend payout, becoz of a co-relation...not entirely sure I agree with this. Dividends don't seem to be very correlated...can u give an example?
“We are the middle children of history man, no purpose or place. We have no great war, no great depression. Our great war is a spiritual war, our great depression is our lives!" – Tyler Durden
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guru267
#130 Posted : Tuesday, March 23, 2010 3:25:59 PM
Rank: Elder

Joined: 1/21/2010
Posts: 6,675
Location: Nairobi
@scubidu the reason i CANNOT agree with the altman Z model is because it judges companies using only financials maikng it seem like the more debt a company takes on the more likely it is to go bankrupt and the less debt a company takes on the more safe it is from bankruptcy...

it doesnt consider the companies strategies to meet its future obligations and future changes in the asset base of the company as a result of taking on debt... armed with this makes current financials become useless... (ARM management says the company will be debt free by 2013 but this model says it going bankrupt this year) funny huh???

about the co-relation... its all over the NSE.. for companies with strong cash flow when the EPS goes up dividends go up.. representing a direct corelation between EPS and dividends....

Mark 12:29
Deuteronomy 4:16
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