Tuesday, December 24, 2013

Take Profit On HARNLEN

1. Share price increased 45% since I highlight this stock. On 1-Oct-2013 when I wrote about HARN LEN, the share price at that was only RM1.00. At that time, the news is that Harn Len Corporation (HARNLEN) sold its 2410 ha of land in Sabah for RM184.6m cash to Boustead. Recall at that time I mention that "If you look at the share base of 185.5m, the cash of RM184.6m translated into about RM1.00 per share. Since this Company still owns 12,200 ha of plantation land in other states, its share price is unjustifiably trade near RM1.00."

2. Announced special dividend of 20 sen yesterday. This confirms The Star news previously on 3-Oct-2013 that the potential amount of special dividend works out to near 21 sen. You can read more here

3. Lack of short term excitement after the special dividend announced. I still believe HARNLEN is worth RM1.80 in the long run but you must know that this is the minimum value of all of its estate. This value will only be realized in the long run. Ex the dividend of 20 sen, my new Target Price will be RM1.60.

4. Time to lock in profit after good 45% gain. At this juncture, I think the 45% gain should be good enough for me and hence I close position on this stock. I will switch this money to TSH, a promising counter, will write about it next time.