Cosco Shipping Energy (1138.HK)

Do you fancy to find a stock that has both solid FA and TA? I think I found one  in Cosco Shipping Energy (1138.HK) this morning.

I entered at an average price of $3.427 and it closed today, 23 Nov 2020, at $3.60, more than 5% gain within the same day. Intraday high was $3.62. Solid! 

1138 daily chart: Solid! 

Will it take a breather from here soon?  I don't think so. 

1138 can be a growth stock: good p/e (below 5x); expected about 10% dividend yield when company announces the Q4 earnings on 30 Mar 2020 for the leap in their earnings in FY2020; very good operating cash flow in the first half of 2020! As it is, the PEG is less than 0.5.

My target price? The immediate resistance will be about $3.82. I believe it can hit $8.00 in about half a year. Let’s see. 

Superphang
http://superphang.blogspot.sg

SINOTRANS (598) --- 78% within 3.5 months

I recommended SINOTRANS (598.HK) about 3 and a half months ago when the price was at $1.62. I bought it at $1.60. It was up 11.28% today, 17 Nov 2020, and closed at $2.86 and my paper gain is now 78.75%. Solid. Has it been too feverish and is it time for me to pocket the gain soon?  I think it has some room to move up. 

The cup as seen from the above weekly chart is huge and once it shoots above the resistance, it will have to move up efficiently again. I would not mind some consolidation along the way. $3.08 is the next hurdle but I think I will hold it tight for it to reach my further target of $3.80. 

Superphang
http://superphang.blogspot.sg

Sinotrans H Share is grossly undervalued

中国外运长航集团有限公司, a substantial shareholder, bought 5.3 million shares of Sinotrans 中国外运 (601598), the A Share equivalent of 958 of H Share on 15 Sep 2020 (through 集中竞价的方式) with a total outlay of CNY18.2866 million or about CNY3.45 per share.

 

CNY 3.45 is about HK$3.948. This is at 2.077x of the H Share of Sinotrans (598).
With dividend yield at around 7% and price to book at 0.443x, I will keep it for the long haul.

 

Superphang

http://superphang.blogspot.sg

Sinotrans 598.HK

I bought Sinotrans 中国外运 (598.HK) at HKD1.60 recently --- an absolutely low value, and I should likely invest in this stock for the long haul. 

The current price of 中国外运 Sinotrans A share (601598) is RMB 3.59. Converting to HKD, it is 3.59*1.1255= HKD4.040546.

Compared to 中国外运 H share (958.HK) at the closing price of HKD1.70 today, 溢价(A/H), or excess price A-to-H price ratio, is 4.040546/1.7 = 2.3768. If we can arbitrage this share by buying the H share in HK Exchange and selling it to Shanghai Exchange as A share within the same day, this is like a surge of 137.68%.

Or put it simply, you enjoy the same absolute dividend whether you invest in 中国外运 H share (598) or 中国外运 A share (601598), but the yield in H share is around 10% quite consistently in the past few years at this current price but in Shanghai Exchange, the A share will only yield (10/2.3768)% or 4.2%. Obviously 4.2% yield is still attractive enough to Chinese A share investors given the current low interest rate environment.

But if we can try to pay for a stock valued at 137% more immediately by buying 598.HK today and this will mean if China A share investors can enjoy 4.2% dividend yield, you can pocket your 10% yield should the company be able to maintain its performance in the middle to long term. 

If the excess A-to-H price ratio can be reduced to parity, your capital gain is 137.68%. 

Superphang

http://superphang.blogspot.sg