OSIM: Long Term Up Trend Still Intact

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Base on the chart, Osim is still trading on an long term uptrend with a resistance at $1.08. However, Osim may be pulled back in to the uptrend support at about $0.86 which is also a 78.6% FR level in the near term. Fundamentally OSIM financial performance is average.

Base on FY2009 Financial Result:

  • Current PE = 28 at $0.975 (Overvalue)
  • Sales Renevue YOY is degrading since 2006 (Big Concern to me as OSIM may be facing fierce competition and losing its competitive advantage!)
  • Net Profit Margin = 4.9%  (This is bad for a company that sell BRAND!)
  • ROA = 10.1 %  (OK)
  • ROE = 24.2%  (Good)
  • Current Ratio = 1.3 (OK)

OSIM does not meet my stock selection criteria and I view the OSIM stock price may plunge if the competive advantages cannot be sustained. We can see quite a number of competing brands in Singapore and definitely in China and price competition definitely is a headache to Osim. Osim has to reinvent itself to continue to push out more innovative products to otherwise they cannot survive in this market place. Things to watch out for: Osim has to constantly push out innovative and “WOW” products every quarter, otherwise their profit margin and sales revenue may be further eroded.

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Genting Singapore: Where is the Next Price Target?

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Genting has broken the resistance at $1.30, gap up and closed the last trading day with a bullish marubozu candle due to much better earning than expected. Probably many of you will ask how high can Genting Singapore goes and what is the next resistance. Base on Fibonacci Retracement, the next resistance is $1.51 (123.6% Fibonacci Retracement Level), followed by $1.64 (138.2% Fibonacci Retracement Level). That is the beauty of Fibonacci as it can predict the next future resistance or support levels where there is no previous history to refer to. However, be cautious on trading Genting as the chart shows Parabolic Curve again! It happens before and it will happen again! History tends to repeat itself!

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Pacific Andes: Trading in A Symmetrical Triangle

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Pacific Andes is currently trading in A Symmetrical Triangle for a short term. Base on the chart pattern, it looks like Pacific Andes is going to breakout soon. Long term chart is still on an up trend. Fundamentally, Pacific Andes does not have any “wow” factory base on the financial result. Current PE of 16.1 is at its fair value but considered high compared to the past 3 years average PE of 9.1. Nothing fantastic financially base on FY2009 result:

  • Net Profit Margin = 7.6%
  • ROA = 2.2%
  • ROE = 4.8%
  • Current Ratio = 1.8

$0.305 is a significant level to watch. This is also a 61.8% Fibonacci Retracement Level and all three moving averages (MA). Breaking out from this Symmetrical Triangle will send Pacific Andes to either $0.35 (78.6% FR) 0r $0.24 (38.2% FR).

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