Value or Value Trap in Worldwide Holdings? Part II

Cont...

Here's an interesting issue.

Say I Ass-u-me (LOL!!) that one purchased Worldwide Holdings Bhd back in Sept 2004 as per the article suggested at a price of 2.04.

Reasons?

Low price earnings multiple (6x), 50% discount to its NTA of 3.91 and with a cash balance of 83 million or a cash per share of 48 sen.

Let's look at the end result if one had invested in Worldwide at a price of 2.04.

Present day. March 2006. Worldwide is now trading at a price of 1.89. (ps. last May, Worldwide was trading as low as 1.71)

How do you rate such an investment? And how do you rate investing based soley on yardsticks?

Present day.. Worldwide announced its earnings on 28th Feb 2006.

Quarterly rpt on consolidated results for the financial period ended 31/12/2005

Its total earnings for fy 2005 was 50.708 million versus fy 2004 total earnings of 52.632 million.

Another sluggish performance.

And what was Genting Sanyen Power earnings contribution to this group? 57.641 million.

And again... don't you wonder what's happening in this listed company?

Crudely put.. some might even question what the management is paid to do!

Here's the value poser again... :D

Worldwide now trades at a price of 1.89.

And at 1.89, Worldwide is trading at a price earnings multiple of only 6.5x based on its trailing twelve months earnings.

Worldwide is still trading at a huge discount to its NTA.

Worldwide cash per share yardstick has risen to a whopping 72 sen per share. (cash at piggy bank now stands at some 124.382 million as reported in their Feb quarterly earnings)

How brown cow?

Still interested in considering Worldwide as a value stock?

At 1.89... you want onot?

Or do you really think this is a value trap?

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here's some comments from hhc:

For worldwide...

1) Management.
0/10. With so many hanky panky deals ongoing, i dont trust its board. If not of genting sanyen, worldwide will be in PN4 long time ago

2)Growth
0/10. Do u see growth? Do u see what is the future growth sector for worldwide? Nile,zero, nothing.

3)Div yield
Peanut in this case even though they can afford much more

4)Cash per share
8/10. Great to boast that u in a business with lot of cash in hand. But to have the cake and eat it is totally impossible. The best thing is , u will never know when the cash will be depleted (pumped into funny oversea venture with no return, remember epic in canada).

5)PE
2/10 If u look at worldwide as Property dev, then its PE is terrible. It doesnt make much (or any) money in Pro even with cheap land. Wonder do the board knows how to calculate?
AS for genting sanyan, it's saturating and one off good luck event for Worldwide. Dont expect another deal like this soon.

6)Liquidity
4/10. Not heavy tradinf volume and not volatile in its share price. Even the syndicate finds it hard to push the stock. Too lousy story to sell.

Overall: Avoid. the reward just doesnt correlate with the risk involve. I will try in Genting casino instead. At least i got the free drink.

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how? Got any comments to share?