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3 Little-Known Companies With Significant Share Buyback (Guest Post)

3 Little-Known Companies With Significant Share Buyback (Guest Post)

There was a revival in stock prices since the global collapse in prices during March. However, the recovery in stock prices were not even. Some industries such as Technology recovered faster than other traditional sectors such as engineering.

As a result, some companies took the opportunity to employ share buybacks. Share buybacks are usually administered as the companies feel that the stock prices are undervalued. The management of the companies usually have a better understanding of the finances and future results. Buybacks could be regarded as a confidence booster to the company’s future results.

We have scouted the SGX market and have identified 3 companies for your considerations.

#1 Singapore Shipping Corporation Ltd

This post was originally posted here. The writer, James Yeo is a veteran community member and blogger on InvestingNote, with username known as Smallcapasia and has 864 followers.

Singapore Shipping Corporation Limited (SSC) is well-established shipping group in Asia and listed on the main board of SGX. Its businesses include ship owning, ship management, shipping agency & Terminal Operations, and Logistics Services. SSC owns 6 vessels and charters it for the international market.

As of the latest annual report, SSC’s revenue decreased by 3.1% to USD 46.7 million. Its net profit decreased slightly by 10.9% to USD 9.2 million. Free cash flow came in at a healthy level of USD 11.4 million. As a result, cash balance of the company was at a high of USD 30.5 million. Results were slightly weaker due to the slightly weaker shipping market at the end of 2019.

SSC has been purchasing its shares back since 6th July 2020. In total it purchased 249,000 shares from the market. Total transactional value of all the shares amounted to $68,598 and share prices bought back were in the range of $0.25-0.26.

SSC last closed at $0.26, which values it at a P/E ratio of 8.46 and dividend yield of 3.85%.

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3 Things to Think about before You ‘Average Down’ on Your Shareholdings in a Company (Guest Post)

3 Things to Think about before You ‘Average Down’ on Your Shareholdings in a Company (Guest Post)

I have received a number of emails and private messages the past couple of days seeking my advise on whether they should “average down” their shareholdings in a company.

How To Catch A Falling Knife (Stock That Is Rapidly Falling)

This post was originally posted here. The writer, Lim Jun Yuan is a veteran community member and blogger on InvestingNote, with username known as ljunyuan and has 1055  followers.

While I am unable to give you a definite answer on whether or not you should “average down”, as all investors think and do things differently, and are unique in their own ways, but there are a few things (3 in particular) you can ask yourself which I hope will help you make the final decision.

Before I reveal what these three things are, let me first talk a bit about what does “averaging down” mean (for those who may be hearing about this for the first time) – in layman terms, it simply mean you increase your shareholdings in a company that is currently trading at a lower price, and in so doing, you bring down the average price of your shareholdings in the company.

To explain this with a simple example, let’s say you originally have 1,000 shares of Company A at S$10.00. However, the share price of Company A is now trading at just S$5.00, and the act of “averaging down” means you increase your shareholdings in Company A at its current trading price; assuming you decide to buy another 1,000 shares at S$5.00, then the average price of your shareholdings in Company A becomes S$7.50 now, which can be calculated as follows:

Initial Purchase: 1,000 shares x S$10.00/share = S$10,000

Additional Purchase: 1,000 shares x S$5.00/share = S$5,000

In total, you have now invested a total of S$15,000 in 2,000 shares of Company A.

As such, your average price in Company A is S$15,000 divided by 2,000 shares = S$7.50

Now that you have a better understanding of what “averaging down” means, let me share the three things you can look at to help you decide whether or not you should do so:

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