Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Spekulatius who wrote (37947)	5/20/2010 12:14:35 PM
From: E_K_S	Read Replies (1) \| Respond to of 78753

Hi Spekulatius - re Noble Group NOBGF I originally bought shares in the company because of their diverse business (many different logistic segments) located around the world. Only until recently have they owned the resources they moved but rather added value throughout the distribution chain by processing the commodities. To finance many of their acquisitions they used equity and debt. When the China sovereign fund made a 20 percent equity investment ( about $1B), I increased my position. With these new monies, they have been buying the "hard" natural resource assets (coal mine in Australia, farm land in Brazil) and selling the commodities in China using long term contract commitments. It's difficult to analyze their different business segments as their reports are not very comprehensive, in foreign currencies and difficult to calculate per share figures (they appear to have many different classes of stock). When I reviewed their operations (about 8 months ago), their PE was around 10 and they had paid a dividend equivalent to 10% annually (paid in stock). Is this a ponzi type scheme? Perhaps but their businesses are making money and growing. There is a small red flag as their class of stock has changed, dividends paid in "script" and it's hard to view their long term history etc. My position is small (less than 1% of portfolio) but I do like their main customer (China), all the different business segments they operate and the huge sovereign fund investor. From Wikipedia - Nobel Group en.wikipedia.org "...Noble Group Limited (SGX: N21) is a global commodities trading/supply chain manager of agricultural, industrial and energy products. Noble manages a diversified portfolio of essential raw materials, integrating the sourcing, marketing, processing, financing and transportation. With 2008 revenues of US$36.1 billion, Noble continues its transition to owning and managing more strategic assets, sourcing from low cost producers such as Brazil, Australia and Indonesia and supplying to high growth demand markets including China, India and the Middle East. Noble owns coal and iron ore mines, grain crushing facilities, sugar and ethanol plants, vessels, ports and other infrastructure. In 2008, Noble debuted on the Fortune Global 500 (#349), was included in the new 30 security Straits Times Index, gained a top ten placing in the ACCA/CFO Asia "Regional Corporate Transparency Index (CTI)” and received a BBB- rating (investment grade) from Fitch. Noble was placed on the Forbes Global 2000 and Forbes Fab 50 while being included in the S&P Global Challengers and The Asset's Best 60 Corporate Governance Award. Noble also received the Corporate Governance Recognition Award: Classes Of 2006 - 2008 - by Corporate Governance Asia and was chosen as one of FinanceAsia's Best Companies. In 2005, Noble joined the MSCI Singapore Index. During this period, the Group was recognized as one of BusinessWeek's Stars of Asia and a Best Employer by Hewitt Associates.[citation needed]..." =============================================================== Because the shares trade on the pink sheets, you can get inefficiencies. I use my Ameritrade to buy shares. They charge a foreign company stock transfer fee of $15/per trade along w/ their standard trading fee. Shares are bought on the Singapore exchange and transferred to my Ameritrade account (that's the $15 fee). Through Schwab Global it's way too expensive almost 8% to buy 8% to sell along with currency exchange fees (w/ minimum fee of $250/trade). The annual stock dividend will be my first. I will know better how it worked out when I can see the total payout and measure my net return based on my cost basis (w/ fees). This is one you want to accumulate on significant dips and sell in 3-4 years perhaps for a double, Yes, I have compared it to my BHP (similar growth potential) but with that hazy Chinese accounting. EKS