Property stocks undervalued: 52 percent discount – AmResearch

Today, when I was giving a presentation to my colleagues, I asked if any of them bought any shares / stocks. Everyone said no. I laughed and told them that everyone should also think about this as another form of long term investment. I explained briefly about LinkedIn which is a listed company in US. It is trading at over 800x Price Earning ratio. Briefly, it meant that if you were to buy the stock at RM100 today, it would take the company 800 years to double your RM100 into RM200.
The current FD rate of 4% would enable you to double your money in 18 years. Then, why are so many investors still buying LinkedIn shares? Well, one word, ‘expectations.’ They believe this company would somehow earn enough to justify their current share price. For their sake, I also hope LinkedIn would do better for 2015 versus their 2014 results. Thus far, Q1 result has not been impressive but who knows….. right?
I always believe Warren Buffett when he said that when we buy undervalued companies, their business performance would soon be reflected in its share price. How about 52 percent undervalued shares? According to AmResearch, it has reaffirmed its ‘overweight’ outlook for the property sector. In fact, the stocks under their current coverage are having a steep 52 percent discount vis-a-vis their net asset value. Briefly, this means that if you buy them today and they go bankrupt tomorrow, the money you will get is more than the money you paid. Great deal right? Well, recently I found them giving some reports on MRCB and Mah Sing. Please read carefully before you buy.
Oh yeah, please do not buy simply because AmResearch says so, ok? Their own words, reported in an online article in a local newspaper. “While we expect residential prices to continue moving sideways in 2015, a return of pent-up demand towards end-2015 – barring external shocks – is possible as the market is still awash with liquidity. ” Briefly, this meant lots of people have money but no one has really bought. Happy buying or waiting.
written on 22 May 2015
Next suggested article: Stock down? Stock up!


  1. froggy avatar

    Hi Charles,
    I am not based in Malaysia and keen to buy some shares as well, is it possible for you to share amresearch report on the property market?
    I read Mah Sing edited 2014 net asset per share is RM1.5, while trading at about 2.1 today. no discount though. lolz
    My email is
    Hope to hear from you

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