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Other than the standard PEs, NAV, management , transparency ,free float , dividend ratios , I am thinking what other factors affect a wider Investor interest for a share.
Before we start, lets leave out the the biggest factor of them all. What is that?
Different times encourage different share plays. When the true bull starts, I think big share names mentioned these days will go into "relative" hibernation. Some small midcap shares may out perform the big ones ( what are they is another topic) .
So market mood, and short term investor interest with the consistent backing of big boy pushes maybe the biggest driving factor of them all. We saw the game how CTC and NEST prices were driven to what it is now. PE and NAV valuations for these share are a joke and is not applicable.
Okay leaving that aside let start a discussion.
Below is not a buy recommendation for GLAS . It is meant as a "scapegoat" for an academic discussion
Ex: If we look at a share like GLAS, it is surprising to see with the present statistics and consistent dividend ratios , why is gaining more interest . Consistent dividend is a hot topic in a market like this right? GLAS has that feature. Is is a Monopoly. Yes, it is also a monopoly. ( Yes it has it challenges and can have indirect competition but even CTC , NEST , LLUB has challenges . ) It is international . Yes.
So what gives?
1) It appears that , in the minds of people there is a distinction formulated between who is the major share holder of a company. Is it multinational , international, asian/international or family held? ( no offence to anyone . Just a factual reality I am trying to derive. I may be wrong)
2) Is it the trust/hope Investors placed in the management ?
3) Do people look at the consistency of the management and how long of a history the company has.
Then TJL is bit of an enigma isn't it ? ( not an enema okay). GLAS was listed longer than TJL.
I will stop and leaving more thoughts/points to come from other members. ( there are a few more that comes to my mind)
Even if a company has other issues, I find the below point a share price booster.
i)
a high (consistent) dividend pay is not enough.
It would be much better to distribute the same dividend spreaded over several times year.
Same applies for share like TFIL, LFIN, SDB , CDB , JINS all which has decent dividend ratios to current price
( I am picking these share as an example based on dividend pay to current market price) .
Even if the there are trust issues with the management, I guess more short term interest can derive if they start spreading
dividends more often. This would atleast buffer somewhat ridiculous price fluctuation below it market worth .
Seems companies like TJL and PLC has understood this concept better :-)
ii) "treat the minority holders wirh respect and given reward them
Look at CABO and RENU. Few shares in the market , fantasic PE and Book values but ridiculous market prices.
Why : useless dividends, no bonuses, and no apparent management concern over minority
FYI :
a) I hold some of the mentioned share but it has nothing to do with this academic discussion.
b) Companies like COMB still haven't got big prices pushes( capital gains) though having very good investment grade qualities.
We need to leave them out of this discussion as atleast they are stable and does not have massive price fluctuations or crazy share ( under) valuations.
All are welcome to comment and contribute ideas. Maybe the management of companies will see this and start treating sharesholders better . Huh a wishful thought right?.
Maybe Tortoises ( not the one who gave a Theory) will give feathers!!!
Before we start, lets leave out the the biggest factor of them all. What is that?
Different times encourage different share plays. When the true bull starts, I think big share names mentioned these days will go into "relative" hibernation. Some small midcap shares may out perform the big ones ( what are they is another topic) .
So market mood, and short term investor interest with the consistent backing of big boy pushes maybe the biggest driving factor of them all. We saw the game how CTC and NEST prices were driven to what it is now. PE and NAV valuations for these share are a joke and is not applicable.
Okay leaving that aside let start a discussion.
Below is not a buy recommendation for GLAS . It is meant as a "scapegoat" for an academic discussion
Ex: If we look at a share like GLAS, it is surprising to see with the present statistics and consistent dividend ratios , why is gaining more interest . Consistent dividend is a hot topic in a market like this right? GLAS has that feature. Is is a Monopoly. Yes, it is also a monopoly. ( Yes it has it challenges and can have indirect competition but even CTC , NEST , LLUB has challenges . ) It is international . Yes.
So what gives?
1) It appears that , in the minds of people there is a distinction formulated between who is the major share holder of a company. Is it multinational , international, asian/international or family held? ( no offence to anyone . Just a factual reality I am trying to derive. I may be wrong)
2) Is it the trust/hope Investors placed in the management ?
3) Do people look at the consistency of the management and how long of a history the company has.
Then TJL is bit of an enigma isn't it ? ( not an enema okay). GLAS was listed longer than TJL.
I will stop and leaving more thoughts/points to come from other members. ( there are a few more that comes to my mind)
Even if a company has other issues, I find the below point a share price booster.
i)
a high (consistent) dividend pay is not enough.
It would be much better to distribute the same dividend spreaded over several times year.
Same applies for share like TFIL, LFIN, SDB , CDB , JINS all which has decent dividend ratios to current price
( I am picking these share as an example based on dividend pay to current market price) .
Even if the there are trust issues with the management, I guess more short term interest can derive if they start spreading
dividends more often. This would atleast buffer somewhat ridiculous price fluctuation below it market worth .
Seems companies like TJL and PLC has understood this concept better :-)
ii) "treat the minority holders wirh respect and given reward them
Look at CABO and RENU. Few shares in the market , fantasic PE and Book values but ridiculous market prices.
Why : useless dividends, no bonuses, and no apparent management concern over minority
FYI :
a) I hold some of the mentioned share but it has nothing to do with this academic discussion.
b) Companies like COMB still haven't got big prices pushes( capital gains) though having very good investment grade qualities.
We need to leave them out of this discussion as atleast they are stable and does not have massive price fluctuations or crazy share ( under) valuations.
All are welcome to comment and contribute ideas. Maybe the management of companies will see this and start treating sharesholders better . Huh a wishful thought right?.
Maybe Tortoises ( not the one who gave a Theory) will give feathers!!!
Last edited by slstock on Sun Sep 22, 2013 12:14 am; edited 1 time in total
