SIGN UP FOR $10 TO UNLOCK ALL ARTICLES! Every dog has its day. Recently, Hong Fok share price stole the limelight when the counter surged to a 14-year high following an article in The Straits Times claiming that Hong Fok share price could be undervalued. Yes, you are right, its 14-year high. At the point of writing, Hong Fok share price is trading at $1.05. The last time that Hong Fok share price was trading at $1.05 was in 2007.
The incredible surge of Hong Fok share price should be the work of the big boys. It is almost impossible for retail investors to push up the stock in such a manner. At least not in SGX. Question now is whether it is too late for retail investors to jump on the bandwagon.
Recently, one of the long-time members of this blog requested for a review on Hong Fok share price. I am more than happy to do a coverage on Hong Fok share price as this is one of the privileges of being a member of this blog. If you are keen to ask for coverage on certain investment products or stocks, do sign up for SG Wealth Builder membership! I will try my best to do an objective and balanced review.
As compared to CapitaLand and City Developments Limited, Hong Fok is obviously a small cap stock. Nonetheless, like the big boys, Hong Fok share price has been embattled for the past year due to the fallout from the pandemic. This is because Hong Fok owns the Yotel Singapore Orchard Road, which had been badly impacted by COVID-19 because of the global travel restrictions. Sales of its residential units of Concourse Skyline is also affected.
To rub salt into wound, like many of its industry peers, the property developer also suffered from losses on revaluation of its investment properties, albeit at a smaller scale as compared to CapitaLand and City Developments Limited. These factors combined to knock the wind out of Hong Fok share price.
At Price/Book Value of 0.339, Hong Fok share price is certainly trading at a huge discount to its book value. But then again, property giant, HongKong Land is trading at an even lower Price/Book Value of 0.322. Taking this into context, it is true that Hong Fok share price is now trading at a huge discounted level but it does not necessarily mean that the counter is a value buy. After all, cheap does not mean value in stock investing. Investors should consider the business fundamentals before investing in a company.
Note that this is an opinion article and not meant to be a financial advice. Please do your due diligence or engage financial advisors before investing in the stock market. Furthermore, I am not vested and have never invested in Hong Fok before. Whether Hong Fok share price will surge or collapse has no impact on me. Thus, this article is not meant to induce readers to make any form of investment decisions.
Hong Fok share price faces long winter
Although Hong Fok share price is on a riot now, I honestly doubt that the run is sustainable. I will attempt to analyse from the perspective of business fundamentals and industry outlook. However, I must reiterate that there is no such thing as good stocks or bad stocks. There are only good or poor investment strategies. So what this means is that it is possible to make some monies out of the volatility of Hong Fok share price, provided you set the appropriate entry and exit levels.
Firstly, The Straits Times article probably [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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