Thursday 4 April 2013

Analysis of Asian Bamboo

A Chinese forest and fiber company

I´m sorry for this but I will start presenting my new analysis results with the company that I already have. It will be a bit boring for you guys maybe but I need to see how far off I have been with my choices.

Company: Asian Bamboo

Business:  A Chinese company that are registered on the German stock market. Main business are sale of bamboo in every form possible meaning as wood, as food, as textile fibres.

Active in: Mainly in China, which is current primary market.

P/E: -1.9

contrarian values of P/E, P/B, ROE as well as dividend
The updated analysis of Asian Bamboo shows that the P/E is -1.9 which is of course not acceptable and the P/B is as low as 0.1 which is great! Due to the negative earnings we do not get a satisfactory value out of Grahams equation. The earnings to sales is -27% and also the ROE is -6.9%. The book to debt is excellent with 4.8. In the last five years the growth has been very good with 10.7% however we already know now in 2013 that that growth has dropped significantly. But with the old figures from 2012 the motivated P/E should be 25 to 28 but due to the negative earnings I do not want to make a statement of the current market valuation. They pay no dividends which is bad.
Conclusion: Asian Bamboo looked like a healthy company which had a tough year in 2012 which has become even worse in 2013. The indicators from Graham, Lynch as well as from the contrarian concept told me to buy in 2012 and I bought... a lot last year. Unfortunately I started buying too early and today I would not have stepped into the company but would have observed it to see if it would manage to turn around and then I would maybe have stepped in.

If this analysis is too old then please just get back to me.

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