Yongnam seems to be a cyclical turnaround play if it can execute nicely on all the projects in the pipeline. I also see that currently there is only 1 brokerage firm covering Yongnam (CGS-CIMB), which means it may well be under the radar currently.
On the other hand, investors should beware of 2 things:
1) Cost overruns. Any regulatory embargo could lead to a surge in material prices.
Labour shortage could also lead to cost overruns. Yongnam currently has 1,450 staff, including 950 workers. Any award of major projects could entitle Yongnam to up its workers quota on project basis.
2) Lumpiness in earnings. As an order book-driven business, the timing of contract wins is uncertain. Consequently, revenue recognition may be lumpy quarter to quarter.
Thus, I suggest that you can look if there is any concrete turnaround through its quarterly results before deciding whether you should plunge in. Cheers
hi james, any view on yongnam? is it bound to recover?
Reply to @wensonkheoche : Hihi, i saw quite a few articles on it.
https://www.theedgesingapore.com/cimb-keep...
https://s3-ap-southeast-1.amazonaws.com/in...
Yongnam seems to be a cyclical turnaround play if it can execute nicely on all the projects in the pipeline. I also see that currently there is only 1 brokerage firm covering Yongnam (CGS-CIMB), which means it may well be under the radar currently.
On the other hand, investors should beware of 2 things:
1) Cost overruns. Any regulatory embargo could lead to a surge in material prices.
Labour shortage could also lead to cost overruns. Yongnam currently has 1,450 staff, including 950 workers. Any award of major projects could entitle Yongnam to up its workers quota on project basis.
2) Lumpiness in earnings. As an order book-driven business, the timing of contract wins is uncertain. Consequently, revenue recognition may be lumpy quarter to quarter.
Thus, I suggest that you can look if there is any concrete turnaround through its quarterly results before deciding whether you should plunge in. Cheers
Hi, What is your tp to sell this counter?
Reply to @shareidol : i will monitor the quarterly results :)
Apologies for not getting it out earlier on Sunday as my family has fallen ill these past few days. Thanks all!
Reply to @Smallcapasia : Thanks James, wishing your family a speedy recovery!