CDW nav around 0.15 now trading 0.08, why?
ACQUISITIONS AND DISPOSALS :: NON-MANDATORY DISCLOSURE :: ACQUISITION OF SHARES IN S.M.T. ASSEMBLY LIMITED
Is this the same SMT listed on SGX?
Can anybody advise?
thanks
After being sidelined for years, shares in contract manufacturer CDW Holding are very much in play.
The counter has been rising steadily since December last year and was flagged by theedgemarkets.com in February as a Stock With Momentum.
It is up 33.1% this year, outpacing the 2.8% gain of the benchmark Straits Times Index and the 3.2% gain of the FTSE ST All-Share Index.
What is behind the sudden investor interest? And is there any remaining upside for investors? CDW makes backlight units for a Japanese LCD manufacturer.
It also makes other LCD parts and accessories, as well as components that end up in electronic and office equipment.
While the business is a relatively unexciting one, it does generate steady cash flows.
The result is that long-time investors have generally enjoyed healthy dividends.
The company was listed in 2005 and since then, the stock has declined 54.4%.
However, with dividends reinvested, it has returned 9.8%.
In fact, while revenue and earnings have fluctuated over the last five years, the company has consistently maintained or increased its dividend throughout.
CDW currently has an indicated yield of 6.9%.
The company also has a fairly large amount of cash: 15 cents per share as at end-December.
That is more than half the value of CDW, which closed on May 6 at 22.5 cents each.
Philip Dymo, executive director and chief financial officer of CDW, says the company’s cash holdings were boosted significantly following the closure of its metal stamping operations in Suzhou, China.
In 2013, as part of urbanisation plans, the local government had negotiated with CDW to acquire the land use rights to CDW’s facilities.
All of the compensation due to CDW was fully received last year.
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