The world may have slowed down and stock markets stagnated. But if you are hardworking, you should be able to spot some gems that are going to rise in the near term.
I intend to talk about Emperor Capital Group Ltd (HK:717), an investment holding company. The company is principally engaged in providing a range of financial services in Hong Kong. It provides brokerage services for securities, futures and options traded on the exchanges in Hong Kong, the United States, Japan and the United Kingdom, and provides margin and initial public offering financing, as well as loans and advances to its clients in Hong Kong.
The Shenzhen-Hong Kong Stock Connect will surely be launched by the end of 2016 and this cross-border scheme will surely benefit stock brokerages, especially big laggards like Emperor Capital Group Ltd.
It has consolidated very well with shrinking volume for the first two months of this year after reaching its nadir and market players have started to see some price actions at the end of last week. When the stock markets of China and Hong Kong were badly ravaged in July 2015, the management of the Company did a share placement at HK$0.88 apiece which was 50% above the market price then. This has shown that its management has every confidence in the company.
If the price is at HK$0.70, the trailing p/e of Emperor Capital is at 6.43x, p/b at 1.1x, yield at 3.29%. Market cap is at HK$4.03b, a good size for seeing the fast rise in price if there are interests generated in it. The highest price done in the past year was achieved in last May at HK$2.32 and it has dropped about 70% since then.
All indicators from the chart of Emperor Capital have pointed towards an impending surge once volume is increased by the syndicates after they have accumulated enough ammunition. It is time to increase your stake for this gem if you have not already done so.
Superphang
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