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Do people invest in this stock for growth or dividend?
It gives out dividend in MYR. When it is credited into our CDP account, it will be converted in SingDollar
With the current depressed ringgit value against S$, the actual dividend we will get will be suffered right?
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An impressive 1Q result. The expansion seems well supported by increasing demand on gloves...
(not vested)
Riverstone’s net profit surges 68.6% to RM27.0 million for 1QFY2015 driven by increased demand and product mix
• Revenue correspondingly increased 44.8% to RM127.2 million driven by increased sales
volume as Phase 1 of expansion comes onboard, adding one billion pieces of gloves yearly
• Phase 2 of expansion is on track for completion by end of FY2015, ramping up total annual
production capacity to 5.2 billion pieces of gloves
• Continues to generate positive operating cash flow quarterly resulting in a net cash position of
RM96.8 million to support capacity expansion plans
http://infopub.sgx.com/FileOpen/Riversto...eID=347859
“夏则资皮，冬则资纱，旱则资船，水则资车” - 范蠡
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The share price responded with the excellence 1Q result. Analyst TP follows...
(not vested)
Riverstone shares surge on 1Q2015 results, outlook
SINGAPORE (May 5): Shares of Riverstone Holdings ( Financial Dashboard) gapped up in early trading, rising as much as 12.9%, to a new 52-week high of $1.31 after the rubber glove maker turned in strong 1Q2015 results.
RHB Securities analysts Jarick Seet and Terence Wong called the results "exceptional" and said Riverstone is likely to continue doing well in the quarters ahead, especially as it expands production capacity to 5.2 billion gloves annually by the end of the year.
A key risk, they said, is volatility in the US dollar. Riverstone's sales are mostly denominated in the greenback, but it reports earnings in the Malaysian ringgit.
...
http://www.theedgemarkets.com/sg/article...ts-outlook
Riverstone price target raised 20% to $1.78 by Maybank Kim Eng
http://www.theedgemarkets.com/sg/article...nk-kim-eng
“夏则资皮，冬则资纱，旱则资船，水则资车” - 范蠡
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while Riverstone has been rewarding its shareholders yearly since IPO with dividends, I choose to believe that they are more of a growth counter than a dividend play. the yield is not fantastic though the payout ratio has typically stayed above 40% over the last five years (except FY2014 where management decides to reserve cash for expansion and had a payout ratio of about 36%).
the margin expansion during their weakest 1Q is a strong testament that the company's two-prong strategy in focusing on both cleanroom and healthcare gloves has paid off. with more than 80% of the company's revenue denominated in USD, they will continue to benefit from the strong USD.
the issue at hand however is whether the margins can maintain at current levels (31.6%) going forward. since hitting a peak of USD/MYR of about 3.72 in March, USD has depreciated by some 3.2% to about USD/MYR of 3.60 presently. while the company may manage their internal operations efficiently (which translates to more than 90% utilisation levels), it would be worth noting some prevailing macroeconomic risks such as USD fluctuation (and its corresponding sensitivity on Riverstone's earnings) and also prices of raw material (butadiene).
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On many occassion there is a temptation to take a partial profit off the table since I bought this in 2011.
Its a real struggle between believing in the company operation and looking at your paper profit which is not booked.
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I would suggest that the value investor's approach should be "buy as if you going to hold forever; watch as if you going to sell tomorrow".
Even if fundamentals don't change so fast, prices could.
Before you speak, listen. Before you write, think. Before you spend, earn. Before you invest, investigate. Before you criticize, wait. Before you pray, forgive. Before you quit, try. Before you retire, save. Before you die, give. –William A. Ward
Think Asset-Business-Structure (ABS)
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(06-05-2015, 12:16 PM)Bubbachuck Wrote: (06-05-2015, 10:16 AM)evilbdboi Wrote: On many occassion there is a temptation to take a partial profit off the table since I bought this in 2011.
Its a real struggle between believing in the company operation and looking at your paper profit which is not booked.
Quote from their statement:
" We are however optimistic about our growth prospects as we continue to focus on our capacity expansion plans and ramp up production to ride on the growing global demand for gloves.”
For me, I share the same optimsm and will ride the growth with them. I think I can even forget about my holdings on this company and will just revisit after 3 yrs. [emoji1]
For Riverstone, the outlook is optimistic, but the idea of revisit only after 3 years, isn't a good idea, IMO.
Riverstone is operating in a market where all players are expanding aggressively. Riverstone isn't the market leader. Yes, the demand seems very healthy now, but I am not very sure on near future.
I am expecting a price war soon, which will drive down the ASP. It is one of the reasons that holding me up.
(not vested, and sharing a view)
“夏则资皮，冬则资纱，旱则资船，水则资车” - 范蠡
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