Time to Reflect on Glove investing
Points: Looking at Topglove, Hartalega, Supermax and Kossan
Initially, I too was very skeptical about buying gloves counters. Historically, most pandemic in the past such as SARS, EBOLA, MERS,etc are very short in nature less than 10 months and glove manufacturers have good 2-3 quarters of excellent results and profit growth between 70%-150% in that period depending on the companies sales and market share.
Honestly speaking, have we ever take a pause and reflect on the starting point of COvid-19, the severity(compared with other previous pandemic)?
Gloves are not important during these periods?......Some comments from members
It's been more than NINE(9) MONTHS since the first sighting of Covid-19 in Wuhan,China.
Where do you think we are in the pandemic cycle? [Beginning, Shoulder, Peak, Declining]
Most of you would agree that it's probably only SHOULDER. Maybe not?
Reason is many countries haven't even manage to close down on Wave 1.
Wave 2 would probably occur for countries in the northern hemisphere that experience winter annually.
Besides that, many talk about vaccine. The World Health Organization estimates that 1 billion people worldwide get the flu every year
HAVE YOU EVER THOUGHT ABOUT FLU VACCINE WHICH WAS CREATED DECADES AGO BUT STILL KILLING PEOPLE WORLDWIDE ANNUALLY.
The World Health Organization estimates that 290,000 to 650,000 people die of flu-related causes every year worldwide
Whether or not glove investing is for you, just take a snapshot of the top 4 companies, Topglove, Hartalega, Supermax and Kossan in the last 10 years, their earnings, dividends and profit growth in the last decade rather than currently.
Glove valuations for Topglove, Hartalega, Supermax and Kossan overstretched?
Investment Banks and Brokerages are certainly valuing them this way [Many of them are grads holding some form of certs eg: CFA and paid a fix salary monthly like most of you.]
Note: Do your own valuations is the best way to learn investment. Use their valuation sparingly.
Reflect it on other counters with similar method, then make your choice if it is worth investing long term (>5 years) or mid term (>2 years). I do not recommend short term investment as it is pure speculative and it is not worth putting your hard earn money in a gambling mode.
To the naysayer, sour grapes, I respect your opinion and value them. You had added additional variables and perspectives that I might had missed earlier.
And please sing a song to the old man who blogs daily and the little girl who speak to old man.