Golden Agri Resouces – Huge Bargain?!
As tabulated in The Edge this week, Golden Agri has historic price earning ratio (PER) of 0.59 times, well below 1.
As PER is affected by 2 important parameters, there are 2 potential scenarios:
Scenario 1:
The stock price has dropped so low that the earning of Golden Agri in one year time is sufficient to cover not only in full, but exceed all the capital invested now.
Scenario 2:
The earning of the stock is inflated, not sustainable and bound for deep correction.
However, the historical PER shown on Golden Agri home page has given a difference figure: 1.157 times.
As retail investor, I always have a problem to obtain the reliable data from free source when the figure difference in various sources. Nonetheless, Golden Agri seems to be a good bargain either in 0.59 or 1.157 times historical PER.
NAV $0.582 for a stock last traded at $0.205 is like a sexy babe waving at you: Simply tempting but dangerous (for guys, of course :-)).
Anyway, we have the choice.
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