Simple FA for LKH,
PE - 2.7x (EPS - 0.11) - Low PE.
NAV -0.45 (35% discounted NAV)
Yield - 10% or 0.04 cents (Good Yield) - but already payout in 23June 2011.
LKH is a property and construction company. From financial ratio analysis prospective, it pretty much shown value investing. It's a good company to consider for long term.
FA - Profit and Loss for LKH, Yearly q to q, it's a
-63% for revenue and -38 for Profit.
From Balance Sheet Analysis,
1. Total Asset increment by +90%. (Good sign as NAV will increment)
2. Total Liabilities increment by +240%. (a negative sign - need to know why borrowing is done?)
3. Cash Flow decreased by -79% to 33 millions. (need to know how money is being spend?)
Why are the losses?
Why and how much is the borrowings being done?
** Borrowings exceeded Cash flow - ( Poor Cash Flow management).
How are they continue to make more money?
The new revenue outlook for LKH is poor with almost all the business units are under performing.
Conclusion,
The financial ratio entry is good with good yielding. However, the outlook for the company is poor. It has poor Cash flow management. In the event of global economic recession, where almost all property sectors are affected and poor Cash flow position.
The risk is high for long term position. Moreover, it has history of paying dividend once a year (23 June 2011), which we have missed the payout. I would say meanwhile, you can put your money elsewhere until you re-visit them by the end of the year.
