Looks pretty cool, after they pared down their debt to just $10 million from $61 million.

ACTION ASIA REPORTS PROFITABLE 1QFY2012

Operating cash inflow increased 32% to S$24.01 million in Q1FY2012 from S$18.25
million in 1QFY2011


Cash per share stands at 14 cents, being 78% of the current shareprice of 18 cents as at
25 April 2012


0.8 cent final dividend for FY2011 has been approved by shareholders

2 more things to add:

1. It has short-term borrowings of $61.3 million, which means the cash in hand of 21 cents a share is not net cash.

2. Investors are in suspense as the company has decided to announce its dividend at a later date. In Fy10, it was 1 cent a share. If they can increase it to 1.5 cent... and add the interim of 0.4 cent, the yield would be 10.6%.

Last done price = 18 cents.

Action Asia highlights it has got 21 cents a share in cash!!!

http://info.sgx.com/webcoranncatth.nsf/VwAttachments/Att_581558FF515860A6482579AC003605F0/$file/Press_Release.pdf?openelement

The Group has reported a 9.1% increase in cash and cash equivalents to S$84.4 million from S$77.3 million in FY2010. This rise was mainly due to the healthy cash flow from operations.

Based on its outstanding number of 399 million shares and S$84.4 million cash in hand, the Group’s cash per share reached 21 cents. The Group has chalked up a higher cash surplus despite reporting a lower revenue and net profit for FY2011 compared to FY2010. Total revenue for the
Group eased 32.0% to S$238.7 million against S$351.1 million in FY2010. Net profit also softened 41.4% to S$15.7 million from S$26.8 million in FY2010.

The major subst shareholder continued to buy shares. It bought 997,000 shares on Monday, bringing its total to 27.281 million shares.

http://info.sgx.com/webcorannc.nsf/AnnouncementToday/3A39421BBFF769534825799E0012E708?opendocument

There is action again today with 200,000 shares to buy at 16 cents. Clearly, the parent company is in the market to accumulate. You can see the history in this report:

Strong Insider buying: ACTION ASIA, STRACO ... - the NextInsight 

Parent company was in the market to buy on 11 Nov. Yesterday too, I guess, going by the 500 lots to buy at 15 cents. And today, in the queue is a 445 lot order at 15 cents.

Very obvious, isn't it? The parent company is buying all shares that want to be thrown at them.
Today another day -- the stock is firm but the volume is low. Maybe not many sellers left?

This evening's announcement; The parent company Action Electronics Co., Ltd was the big buyer on Sept 30. Bought 488,000 shares.

U can be pretty sure it is the parent company again today, which caused the volume to be so high, and pushing the price up to 16 cents. It's good for minority shareholders who want to exit.

300 lots Q-ing to buy at 15.
Eating up sell Q at 16.
This on a lousy market day. What's the good news from Action Asia?

Once again, the Buyer is back! Queuing at 15 cents with 200 lots waiting for anyone to throw.
Wonder why the buying interest.

There is a strong cushion of support at 15 cents.
Anybody wants to exit can sell a few hundred lots to the buyer(s).

Wonder if the buyer is the parent company again..... If yes, why? Manufacturing for Philips is not going to be a bed of roses this year, given the economic slowdown. So why is the parent buying stock?

Parent company bought some more, just announced altogether 2.675 million shares. No wonder the stock is firm at 15 cts. The buyer put up a defence wall --- u throw your shares at it if you are desperate. Question now is will stock move up to 17-20 cts?

Last time, CIMB had 40-c target. Wahpiang, now blue black.

ACTION ASIA, SATS: What analysts say now....

Parent company bought 1.084 million shares on Monday, Sept 5.

omg, got strong support today -- stock now at 15 cents, up 0.5 cent, when there is a bloodbath in the rest of the market.

Could this be a prelude to a takeover offer? If not, what other possibilities>?

Eye-popper today! Close 20.8% up. That's right up, not down.

+ 2.5 cents to close at 14.5 cents. What's brewing?

It seems a logical conclusion that the recent selling of Action Asia shares by insiders might be due to their awareness of the likelihood of Action Asia reporting a very bad set of results for 4Q10. The telltale sign was that Action Asia’s revenue and profits had been on an up trend and it has been paying increasingly higher dividends each year, yet its share price remained unusually stagnant and depressed when many other penny stocks were experiencing upward revisions of their share prices during the period of improving market sentiments for penny stocks.

A closer examination of Action Asia results reveal that the company’s revenue for 4Q10 was S$60 million [4Q09 – S$72.4 million] while the Profit Attributable to Equity Holders was a low S$698,000 [4Q09 – S$4.8 million] or just 14.5% of 4Q09. EPS for the quarter was only 0.18 cts as against 1.2 cts in 4Q09. EPS for FY10 is 5.26 cts. Could this be the start of more bad news?

1-cent dividend for final .... 0.5 given alredy recently.

total 1.5 cents. not bad.

Proves to be a minority friendly management.

I will prefer to buy Qingmei instead of Action. The latest flat result have causes the weaker and short term player to exit the market.

Today weakness is a good buying opportunity with FY11 PE of 3-4x with dividend yield of 7% New capacity already completed and management is focus in ramping up the volume..... fund manager brought at 34 cents level.

Some wise guy once said that there may be any number of reasons directors sell shares - buy house, pay for children's education, buy car, take profit, be kiasu, etc.

There is only 1 reason directors buy shares - they expect to make money from it.

Hi, Abb & Erelation. You may recall that in September 2010 (expiry of share moratorium), Hong Rong Zhi, who held 150 million (10.42%) of China Gaoxian, unloaded millions of his shares at below IPO price of 26 cts; and causing Gaoxian share price to tumble down from 23 cts to 17 cts. Gaoxian’s share price later managed to stage a strong recovery with a doubling in price by Jan 2011.

I respect and give full credit to insiders who divest their shares after the share price has made a sharp run up to fully valued or overvalued level as I think they belong to the “smart money group” of people. However, the same cannot be said of insiders who sold out their shares at very depressed and undervalued price. They may be having personal financial or other problems but their action are seen as not much different from the “dumb investors” who throw out the bathtub water with the baby in it.

Thank you Observer2 for your sharing. At this juncture, investors are rightfully wary of the selling, which is not alarming in my opinion. Still, it has indeed made people turn cautious. I too would not be too happy to cheong in.

The 4Q result will be out soon and we will know what is the shape of the business but in the meantime, I think we can try to see the selling in better perspective:

----- Lien Chien-Liang is a small holder. He had 602,000 shares and sold 552,000 which brought him about S$110,000. This is peanuts.... and it's not as though he is a big fish selling because of a negative outlook for the company

----- Lai Pin Yong is different in one aspect. He is the No.2 largest shareholder of Action Asia, after the parent company which owns more than 50%.

Lai Pin Yong sold about 1.15 m shares, equivalent to less than 5% of his entire holding. He collected S$230,000 and he sold just a small % of his holding which now stands at 24 million shares. 

Lai Pin Yong is 67 years old and a non-executive director, and he could be getting some cash for his spending / enjoyment as he is retired.

Great Analysis! I was thinking to buy earlier but notice that the insider are selling and scrap the idea.

Observer2,what is your thought on Ziwo? The shares went above 40 cents and fall sharply back to 34 cents today.

To find the answer for Erelation.s question, it is helpful to look into the background of Asian Asia.

Action Asia’s 399 million shares were listed on 15 Jan 2004. Its IPO price was 31 cents. It made a nett profit of S$6.9 million in FY 04 & incurred small losses in FY 05 & 06. Since then, its nett profits have been on a steady up trend. Its share price, which has been languishing at below 22.5 cents ever since 2005, hit a high of 22.5 cents in April 2010 and then went into a consolidation phase between the range of 16 to 21.5 cents.

Looking at its Balance Sheet, Action Asia certainly looks a great buy with its very low PE of about 3x and its improving profitability over the last few years. CIMB has a target price of 40 cents for the stock notwithstanding certain key concerns that include: (1) continuous weakening of US$ as bulk of its sales are quoted in US$; (2) more aggressive bidding by some domestic consumer electronics makers that may affect Action in terms of pricing; and (3) limited growth potential moving forward if the group continues to depend heavily on Philips’ portable DVD players. The company looks set to report its best ever results since its IPO. Its share price has also firmed up over the last few months prompting 2 of the insiders (probably very tired shareholders dying to come out) to unload a portion of their holdings –

Lien Chien-Liang

27 Sep 2010 – Sold 147,000 shares at 20 cts

11 Nov 2010 – Sold 353,000 shares at 21 cts

30 Dec 2010 – Sold 5,000 shares at 20.5 cts

4 Jan 2011 – Sold 47,000 shares at 21 cts ----- Balance 50,000 shares

Lai Pin Yong

4 Jan 2011 – Sold 52,000 shares at 21 cts

5 Jan 2011 – Sold 200,000 shares at 21 cts

6 Jan 2011 – Sold 900,000 shares at 21 cts --- Balance 23,938,910 shares (6%)

[Source: SGX Listed Company Announcements]

Insiders’ selling often have a dampening effect on the share price of a stock but the real concern for retail investors comes when the selling takes place immediately after a sharp run up in the share price causing the stock to be fairly valued or over valued.

EPS for !Q, 2Q, 3Q = 1.56 + 1.34 + 2.18

Annualised EPS = 6.8 cts

===> PE of 2.94 based on stk 20 cents

Cheap enough?

11th consecutive quarter of double-digit yoy profit growth. Bottom line would have been stronger if not for a S$1.1m forex loss and S$0.6m allowance for doubtful debts.

Action remains attractive, at 3x CY11 P/E and below its book value. Our target price remains S$0.40, offering more than 100% upside. This already conservatively pegs Action at slightly below 6x CY11 P/E.

ACTION ASIA, SATS: What analysts say now....

No action !!!

Jan 2010 : 20 cents.

Jan 2011: 20 cents.

Maybe the stock price will stay at 20 cents in January 2012.

Yes, pity no strong effort by the company to promote the investment merits of the stock.
But looking at the size of the buy queue at 20.5 cents, I am sure there is accumulation going on.
688 lots buy at 20.5 cents, and 32 queueing to sell at 21 cents. 

Yes, low PE of only about 3X this year's earnings....
Management is inactive about promoting the investment merits of the stock, although management holds a significant stake. Maybe to them it makes little difference whether their holding is worth a lot more or less, since they are in the business for the long term and have no intention to sell out or raise funds for the business.

Beyond the quarterly reports & press releases, Action Asia has done little - any roadshow to meet analysts & fund managers? Any media coverage?

The low profile explains a lot why the stock is undervalued .... Investors will have to wait for some catalyst to re-rate the stock, which in the meantime looks like having minimal downside risks and promises at least a decent dividend (1 cent last year, which is 5% yield if you buy at 21 cents currently)

CIMB target price is 100% upside ...... U can check out this report published last month:

ACTION ASIA, SATS: What analysts say now....

http://www.nextinsight.net/index.php/story-archive-mainmenu-60/903-2010-/3164-action-asia-what-analysts-say-now