July 14, FA/TA for ChinaAOil

July 14, FA-Quantitative Analysis for ChinaAOil

FA- Simple Analysis

• - NAV - 0.6445 (not yet a discounted NAV)
• - Yield - 3.3% (Average Yield)
• - PE - 11.9x ( Not an attractive PE yet)

FA - Intermediate Level Analysis

From the past 3 years, ChinaAOil has a stable Earning Growth of 10%, it is very suitable to use the Gordon Dividend Discount Model (DDM).  What is the DDM Intrinsic Value?

• - Estimated DDM Intrinsic Value - 1.28 - 1.73
• - Estimated Graham Intrinsic Value - 1.20 - 1.46

FA - Using EV/EBITDA vs PE, Entry/Exit Formula

• - EV/EDBITDA = 12, PE = 11.9x (Now, trading at Fair Value at 1.17)

FA - Qualitative Analysis,

This part is skipped. Assuming, you will spend some time to understand the business or annual report. 

Conclusion,

From the FA-Quantitative Analysis standby, ChinaAOil is now trading at Fair Value. Any level below 1.17 is a value investment for you. Next, I will cover the TA entry/Exit for ChinaAOil. 

July 14, TA for ChinaAOil

• Trend - Down
• Momentum - Oversold
• Support - 1.15
• Resistance - 1.22
• Volume - Low
• Candlestick - NA

From TA prospective, ChinaAOil is trading into narrow band. If you are interested on the 7 cents range, entry is at 1.15 and exit 1.22. I will watch the 20D MA as reference. If 20D MA is flat or cross over 50D MA, then it indicates a trend-changing, else there is possibility that it might break 1.15. For trading, it is too narrow and not that attractive. 

But as mentioned on FA, at 1.15 range. It is at FAIR VALUE. If you are looking at long term, this stock offer FAIR VALUE and Yield (3.3%). It's not a bad choice.