Valuetronics - "Thoughts on the market".

Valuetronics went xd before start of trading today & closed 2 cents lower at 53.5 cents. Effectively, one should factor in the 3.2SGD cents (HKD20 cents) in dividend for those who bought the shares no later than last Friday..... thus they are still up 1.2 cents today!

It shows that many bought not just for this divident payout but for the potential growth in the company and share price D)

I reviewed the the balance sheet of Valuetronics again and what makes this stock particularly attractive is the quality of its working capital management (driven by a successful business model). In the last financial FY, it recorded FCF per share of sgd12.6 cents (compared this against DPS of 3.2 cents).

If the quality of its trade receivables can be sustained this would mean that the group is practically a cash machine churning out huge operating cash flow.

In my view, I think the following may happen for FY15:-

- stronger business performance
- bonus issue to raise its liquidity (and market capitalisation)
- dividend to be paid every half year
- continuation of special dividend payment to release excess cash

I am confident as based from the recent management update, shareholders will continue to reap rewards from investing in Valuetronics.

Agreed, thanks for sharing.

1Q15 results were kinda "sweet and sour". ICE segment continues to gain strength and with sales to a new client commencing this Q, this bodes well.

Performance for CE was surprising weak and this may be a concern going forward.

However, management is working hard to increase its ICE revenue and its efforts seem to be working well.

DBVS report issued yesterday reaffirmed its buy rating (TP 72c). Lets wait for reaction from other analysts.

Overall, despite the weaker than expected 1Q results, I still hold out hope for Valuetronics to outperform for FY15.

Agree. I am holding on:)