May 25-27, FA/TA for NOL

From TA indicators -

• Trend - Down 
• - Confirmation by MACD -ve and 
• Officially down when 50D Moving Average (MA) is below 100D, 100D below 200D. With such signals, traders will likely to SHORT it then to LONG it. 
• Price below Ichimoku Cloud -indicate Down trend. 
• Momentum - Average @ 50% range. 
• Classical Support  - 1.92. 
• Classical Resistance - 1.92
• Candlestick (24/5) - inverted hammer - bullish reversal.
• Volume - Low. 

From TA prospective, this is one stock that you can borrow a scripts and start to SHORT it. It has been trying very hard to break the 20D MA and it don't need average trade volume to break its support line. 

From TA prospective, if you are holding it, you might want to re-consider your holding strategy. In this aspect, you need to do your money management rules - read the blog. 

From FA- Quantitative Analysis, to invest in a stock, what you want to look out for,

1. For constant growth stocks - This will allow us to compute intrinsic Value - this is not the case for NOL. 
2. For unstable growth stock - If it has a year of loses, you will need to use PEx or NAV or yielding as your entry guide. I have attached 2 more PE comparison and Yielding comparison for your reference. 
1. If you use Graham Fast rule, PE at 8x. It is not a bad entry. 
2. If you use Yielding as your reference, 2.5% vs 2.8% inflation. Not a good choice.
3. If you use NAV, as your refence - 1.55. It is not a discount NAV.

When such scenario occurred, it is better to avoid such stock and play TA strategy to safe guard your investment fund. If you still insist to invest, it is better to use FA- Qualitative Analysis - read up the business and understand the industry trend. 

I have attached a list of so called "Analysts Research" recommendation. It is up to you to believe those number. 

News update,

125 GMT [Dow Jones] NOL (N03.SG) is down 1.6% at S$1.87 after the container shipper posts a 1Q net loss of US$9.7 million (vs a net loss of US$98.5 million in 1Q 2010 and net profit of US$177 million in 4Q 2010). Deutsche Bank says the results were disappointing, worse than its and market expectations, caused by rate declines and cost increases (fuel). "We think our 2011 earnings forecast (US$351 million) and street consensus (US$387 million) look too optimistic given the losses in 1Q." The house also notes trans-pacific annual contract negotiations should complete over the next few weeks "and we do not expect a favourable outcome for NOL. We would not be surprised if 2Q results are worse than 1Q for NOL and the entire industry." On valuations, it says "the stock is trading at 1.1X 2011E P/B, "which we think is not compelling given the material decline in earnings that is likely this year." It keeps its Sell recommendation and S$1.66 target price. (matthew.allen@dowjones.com)