Buy @ $0.945
Itchy fingers… A new stock to my current portfolio. I previously sold at huge losses my entire stake when I was short on cash and it didn't look like their Brazil Niteroi Yard was going to stop bleeding…
Their Q114 results were released just before mkt opened. EPS = 1.61ct was lower than last Q = 1.95ct. Share price had previously climbed quickly from 87.5ct (I sold all mine before that at lower prices..) to a high of $1+ after the last results when EPS improved from Q3 = 1.36ct as many were betting on a continued recovery. So, I guess the market must have been caught by surprise by the lower EPS… Yesterday, it closed at 99ct and this AM, it quickly dropped to a low of 94ct…
So, why buy?
A closer examination of the profit breakdown shows that despite a lower Revenue (q-o-q), the profit was actually higher from Gross to Operating to PBT. What caused the lower EPS q-o-q was the taxation. For Q4, there was also what looked like Tax writeback as Net Profit ended up higher than PBT.
My conclusion is Q1 was actually showing continued improvement and very likely, we have seen the worst of Brazil Niteroi Yard problems.. In addition, it was stated that for Niteroi Yard, 1 vessel had been delivered in April and another will be delivered in May, ie for Q2 (Jun), the overload would be greatly eased.. Further, with the World Cup in June, here would be lesser competition for Labour as facilities construction would have been completed by then
Logical?
On top of that, Q1 also saw a big increase in their Order Book.
Anyway, just a small bet and can be short term… 😀