Hi Kyle,
Judging from your last post, you seem to know at least a little bit about South America.
In addition you seem to be one of those hopelessly thick and old fashioned guys, who uses simple math and common sense, and who still refuses to buy into the theory that triple digit PE1s and double digit Price to Book ratios are OK. I bet you are probably attracted to high dividend yields too! Especially when they are in a high growth country.
The last time Invested heavily into a company like this was ICN in the first quarter of last year in the low $20's. I sold out in the upper $20's with a nice profit, figuring that the market would not come around to my point of view. It certainly did pain me to watch some big house put a buy on it at $64 a little while ago! Just look at the graph of ICN.
Regarding the perception of CIB (referred to as BIC in Colombia), my guess is that it is well viewed as I believe that it is tied into the Sindicato Antioque¤o, which is a large and dominate local conglomerate based in Medellin. Antioquia, the capitol of which is Medellin, has a reputation as being the home to the most industrious Colombians. It also has a reputation of being the whitest department in the country, of being the most traditional and the most strongly conservatively Catholic department. That coupled with S&P's comments should give you some perspective.
You can see from the fact that their homepage is written without any English, that the idea of making an effort to inform the general English speaking public about what is happening at CIB,in order to keep the share price up, has yet to occur them. Notice how they do not even issue a statement every time they declare a dividend or pay a dividend. What a waste of a perfectly good P.R. opportunity, which occurs twice a month! This in spite of that fact that, when I went to the Suvalor office in Medellin, I was told that over 90% of CIB shares were held in the USA. Perhaps one day they will figure it out. Suvalor is a big (in Colombia) investment house, located in a 20 story tower next to the Medellin stock exchange.
As I think I mentioned before, watch CeluMovil S.A. (NYSE:CVL), the symbol is valid, but the IPO has not occurred yet. When it does, that should indicate that the market's receptiveness for Colombian and/or South American issues has improved.
Best,
Arnold |
