Is Berjaya Sports Toto (BST) a Good Buy at RM5?

The Bursa was down for the last four days.

As I mentioned in an earlier posting,the contrarian players were nibbling about.

So I bought myself some BST at RM5.05. As the market was good this morning, it went up by 2 bits to RM5.15.

Now, let us discuss about BS. Is it a good buy at RM5?

The lowest of the year was RM4.04 and the highest was RM5.35. Before the recent special dividend announcements(both dividend and share dividend in specie), BST was floating about the RM4.68 price. Given today's price at RM5.10,this would mean an investor would have profited RM400 on paper not counting trading charges.

Let us build up a scenario when BST goes ex sometime in mid July. Let us assume that BST maintains the RM5 price cum dividends.

The dividend payout of RM300 will have to be off-set when BST goes ex on 13 July. That would mean the price would naturally be adjusted downward to RM4.70.

Then there is the share dividend distribution in specie. It is one share for every 14 held. At 1000 shares,this would work out to 71 shares. At an adjusted price of RM4.70, it will fetch a value of RM333 to the investor.

Since there is no additional shares on the market via this way of distribution,there will be no dilution in theory.

Again, as we all know, many will sell the new shares for a quick profit and this might destabilize prices for a while. However, the good news is that BST, depleted of its Treasury shares, may just end up in the market buying off these loose holders to bring back the price back to even keel at about RM4.70.

Final analysis:

Initial outlay : RM5,000
Returns by end of July: RM4,700 + RM300 + RM333 = RM5,333
We then minus RM100 as brokerage charges
Therefore returns is RM233

Benchmarked against the 2.5 % bank interest for fixed deposits, which will come to a return of RM10.70 per month,an investment return of RM233 in BST (for only a month) is far more superior than putting it in the bank!

Investing in BST is akin to theoretically putting money in the bank at 55% interest rate or a pro-rated monthly return 4.58%.

So English did not really help!

What a revelation!

That the teaching of maths and science in English the last six years has not improved the performance of students in those subjects must be the unkindest cut of all.

This was the Minister of Education's admission in Parliament today. How sad!“There have been changes but the difference is nominal,” he said, citing a two to three per cent change since the policy was implemented in 2003.

Blame the politicians, blame the educationists and even the teachers. They are just scapegoats for poor implementation.

Many in the Ministry of Education may have benefited from the perks of overseas trips as well as short training stints abroad. However, the quality of their teaching method may be suspect.

So what's new?

Poor Global Economic Indicators

While regional markets break from a streak of bad days and rose, Bursa traded further into negative territory dropping below the purported 1050 support level. Sentiments was weak and volume was medium.

Bursa's recent clampdown on stocks deemed to have been manipulated continue to have negative impact as 2nd liners and liquid stocks with recent sharp spike. These traded lower on heavy selling.

May be this is the type of day to go bargain hunting for good stocks. The contrarian players, I am sure, are out nibbling here and there.

Apart from prices running ahead of fundamentals that caused the recent sell-down, bearish news that the global recession will be deeper than previously fore-casted also played its role.

The World Bank said the world economy will contract 2.9 percent in 2009 versus an earlier forecast of a 1.7 percent decline and growth of 2 percent in 2010 versus a 2.3 percent prediction previously.

Meanwhile, in Taiwan the jobless rate rose to a record in May after new graduates failed to find jobs as companies tightened hiring because of a slump in global demand. The seasonally adjusted rate increased to 5.84 percent from 5.77 percent in
April.

On the other hand, Japanese business confidence improved for the first time in three quarters and demand for services rose. Sentiment among large manufacturers increased to minus 13.2 points compared with a record low of minus 66 three months ago.

So while the World Bank seems to project better figures for Malaysia, it has given the potential importers of Malaysian goods the low down.

Would that mean they will have also to re-adjust Malaysian expected growth rates down again?

Museum 2: No Magic This Time Around

Night at the Museum 2 jut doesn't cut it.

That's the problem with a sequel. The fun is not just there. Everything seems to be a rehash of the original and too many goofy characters in this one make it a dull outing. More is less, here.

The premise of building the whole story of Museum 2 on an evil looking Egyptian prince bringing his army from hell to reclaim a lost throne is not a strong anchor for any film these days.

The only thing in the film was pretty Amy Adams who acted as the lost aviator, Amelia Earhart. Great eye-candy.

Don't waste your money on this film. Stay home.