mm2 share price in song and dance with Temasek Holdings
Has mm2 share price lost its magic? Like many homegrown listed companies, mm2 share price suffered from unjustified poor valuations in recent years despite clocking in decent business performances. Perhaps it is a case of being listed in the wrong place and wrong time, resulting in mm2 share price being grossly misunderstood by many investors. It also doesn’t help that most Singaporean investors tend to invest in dividend stocks or REITs, leading to the pervasive lack of interest in growth stocks like mm2.
As a Singaporean, I am always supportive of homegrown companies, especially the small and medium ones. Secondly, as a content producer, mm2’s business model resonates with my blog, SG Wealth Builder. But I reckon the impetus for this equity research is my fear that mm2 may be on the verge of throwing in the towel and potentially privatize to seek a foreign listing, like what Osim did in 2017. Such drastic approach is understandable because even though mm2 Asia’s business results had been consistently robust, mm2 share price performance turned out to be a disgrace.
In September 2018, mm2 announced a strategic review with the aim of enhancing its corporate profile in North Asia markets and to explore the possibility of seeking a foreign listing of some of the Group’s key businesses to further enhance shareholder value. Is this the last chapter of mm2 share price?
In this article, I will provide my insights on whether mm2 share price will return to its sensational bullish form last seen in 2017 or bid sayonara to SGX investors.
mm2 share price razed to the ground
To illustrate my point on the poor valuations of mm2 share price, the Return on Equity (ROE) has been superbly double digits for the past four years: 44% (FY2015), 31% (FY2016), 30%(FY2017) and 21%(FY2018). The strong ROE performance indicates management’s track record in growing the company yet at the same time, it also underscores that mm2 is maturing to a level whereby ROE would likely hover around 20% in the near future. Despite so, such ROE performances is quite good for an evolving company. However during this period, mm2 share price had only rose from $0.20 (December 2015) to the current $0.30.
In retrospect, mm2 share price did [This is a premium article. The rest of the content is blocked and can be accessible by SG Wealth Builder Members only. To read the full content, please sign up as member.]
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