Day: January 3, 2007

Categories
Stocks

Something Hard to Predict

Reading Time: < 1 minute

Last Updated on January 3, 2007 by stlplace

It’s the beginning of the year again. As usual people like to predict the markets, the economy etc. I don’t know how accurate will that be. But I know probablly half of them will turn out to be right 🙂 Predicting the general market and economy is not an easy job. But I think as individual investor we are not powerless either, at least we can do a few things:

1) Invest regularly (don’t buy all at once);

2) Do the homework, if we don’t have the luxury of visiting the company, at least we can read the 10Qs (quarterly report), 10Ks (annual report), pay attention to the product or services we used in our daily lives and work place;

3) From time to time, we can all summerize what went right, what went wrong;

4) Last but not least, be patient.

Continue reading “Something Hard to Predict”
Categories
Stocks

My Current Holdings

Reading Time: < 1 minute

Last Updated on January 3, 2007 by stlplace

I have the following stocks in my Scottrade account as of today Jan 3, 2007. I remember the beginning of last year I only have 200 shares of Symantec (SYMC)

Crocs (CROX): 46 shares, it seems people can not get enough of those funky shoes.

Heelys (HLYS): 62 shares, it seems everyone is skeptical of this except me 🙂

Home Inns (HMIN):  68 shares, +100% YoY growth, Chinese version of La Quita Inn (as I read the Peter Lynch book lately)

Mindray (MR): 111 shares, China’s No. 1 medical device maker, about 50% YoY growth, is opening a new facility in Nanjing, looking for expansion in the Yangtze delta region which is the economy center of China nowadays. Good move.

Categories
China Stocks

Is Home Inns HMIN too Expensive?

Reading Time: < 1 minute

Last Updated on January 3, 2007 by stlplace

Home Inns’ (HMIN) stock traded above $40 for the first time  today Jan 3, 2007. Since its debut on Oct 26, 2006, the stock almost doubled from its first day close price (about $22.50). From traditional valuation point of view, this is a bit insane. As a stock holder I am also nervous about such a fast run. So…why don’t we do a little PE price earning ratio analysis on this one. Let’s assume it closes at $40 today. The company earned $0.12 in the first half of year 2006, 0.10 in 3rd quarter (non GAPP, exclude one time share based compensation), and let’s say it will make $0.12 for the 4th quarter, which is quite reasonable. 40 divided by (0.12+0.10+0.12), and it’s equal to 117. This is high compared to Google, or Apple. But note the company is growing at more than 100% year over year and we can expect that trend to continue for a few years.

Note: as rule of thumb (or finger), the PE ratio should not exceed the growth rate too much. Say, for a PE 15 company, we expect it grow 15% year over year.

home inns rujia shanghai century park