How Now For Tong Herr?

Here is a follow-up to the posting A Warning From Tong Herr?

Tong Herr closed yesterday at 1.86, down some 13 sen.

Was it due to the losses it posted or was it due to the warning from the company that it's facing anti-dumping charges?

Now assuming, it was due to nervous investors cashing out from the stock due to the ant-dumping charges worries, then perhaps it's best for the 'long term investors' to consider how Tong Herr was doing before fy 2004.

Why?

Those were the period when Tong Herr too had to deal with anti-dumping measures levied against the company. (Yeah, so much for free trade eh? But again one could argue this is not unexpected given the recent global Trade Protectionism (click there for recent postings) issues.)

Now back then, Tong Herr's number of shares were 80.294 million. So for fy 2003 TongHerr had eps around 24 sen.

Yeah, back in 2003, TongHerr was a treasured stock amongst investors. Company's balance sheet was in order and most of all, the growth rate was incredible. I mean earnings growth and not sales revenue growth. :) (Were you in or were you IN? back then? :D )

The chart of Tong Herr in 2003 does not lie.

Anyway as you can see the chart from finance.yahoo.com showed that Tong Herr was trading around 1.40 and 2.60.

Ok, assuming one's earnings estimates held true for Tong Herr in 2003, then one could say that Tong Herr was trading between an earnings multiple of between 5.8 to 10 times in 2003.

Let's look at it now.

Let me take a screen shot from my live quotes provided by RHB Invest.


Now if you click on the picture for the larger view and calculate the most recent 4 quarterly earnings, you would see that Tong Herr only earned some 3 million for the last 4 quarters.

Now put this 3 million into perspective of what Tong Herr was doing from 2000 to 2003.

Doesn't it pales in comparison?

Now Tong Herr share base has increased and Tong Herr now have 127.430 million shares, which means the recent 4 quarters earnings of 3 million, would only equates to an eps of around 2.4 sen only.

And Tong Herr last traded yesterday at 1.86.

So how? PER equals how much?

Which meanings Tong Herr today trades at much higher earnings multiple compared back to 2003.

And what's obviously different now compared to 2003?

Well back then in 2003, Tong Herr's earnings was growing at an exponential pace! Now? Earnings are in a slump and worse still, the company now warns of the anti-dumping proceeding against the company!

How now brown cow?

If you were a gambling person, which way you reckon the stock go?