I have always wanted to be a pseudo-position trader because I cannot check charts and prices due to my job. After reading this article, it got me to thinking and wanting to try my hand in spotting sleeping stocks.
My conditions were the following:
- Must at least be a 2nd liner.
- Must have good fundamentals with manageable debt.
- Must have good potential projects in development.
My strategic approach will be to employ a cost-averaging method for sleepers and use charts to check if the stock is still going where I want it to go. If not, then cut loss.
I made my first "sleeper play" today with FLI. See the chart below.
Resistance:1.54. Cut loss based on trendline: 1.48. Target Price: Based on trailing stops.
Intrinsic value: 2.44 (based on 10 year DCF with 1st 5-year growth at 10% and next 5-year growth at 5%)
ROE: 6% (yuck)
Total Liabilities payable within: 20 years (di puede 15 years na lang sana?)
Implied P/E at current price of 1.54: 11.7x
Beta: 1.46
Intrinsic value: 2.44 (based on 10 year DCF with 1st 5-year growth at 10% and next 5-year growth at 5%)
ROE: 6% (yuck)
Total Liabilities payable within: 20 years (di puede 15 years na lang sana?)
Implied P/E at current price of 1.54: 11.7x
Beta: 1.46
This is a testing-phase for this system and I do not recommend you follow it just yet since this isn't tried and test. Caveat!
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