2016 Portfolio Summary Stock Picks

Its time to evaluate my own stock picks. I had picked 5 stocks in my 2016 Portfolio, alongside with a few updates on my 2015 stocks. If you want to read about my 2016 stock picks, you can click on the dates:

1. LIIHEN: 3 posts posted on: 7 Jan 2016, 29 February 2016, 31 May 2016

2. TOMYPAK: 3 posts posted on: 6 March 2016, 22 May 2016, 7 July 2016, 

3. UCHITEC: 26 April 2016

4: YEELEE: 2 posts posted on: 15 Aug 2016, 28 November 2016

5. SALUTE: 28 December 2016

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UCHITEC - U SEE THAT II *VALUECAP*

UCHITEC had released their Annual Report on 19 April 2016. Indeed there are surprises in the Top 30 Shareholders. This post will be an additional to the previous UCHITEC post. The theme of the Annual Report 2015 "Flourishing from Strength to Strength" with pictures of ripe and ready to harvest paddy. Maybe the management is hinting the share price is going to turn to goldish yellow~ haha. Let's dig in~

1. Fundamental Analysis:

Revenue and Net Profit for UCHITEC from 2011 to 2015

The best part about UCHITEC is its revenue and net profit is consistently high. The average of net profit margin and EPS of 44.66% and 11.94 cents respectively for 5 years. The dividend yield for UCHITEC is even higher than the FD rate, which is 6.09%, which we can see a lot of local fund houses and foreign fund houses investing in it. In its latest Annual Report 2015, the management maintains the dividend allocation of minimum 70% of the net profit, the highest i encounter so far[1]. 

Net Cash per Share and Earnings Per Share

Another highlight will be its high net cash per share. The net cash per share is 0.4592, almost 30% from the closing price on 25 April of 1.73. 83% of its trade receivables are denominated in USD (RM8,57 mil) vs the 60% of its trade payables denominated in USD (RM13.66 mil). Eventhough the USD trade payables is higher than USD trade receivables, its short term deposits is enough to cover the shortage of RM5.09 mil as their USD short term deposits totals up to RM20.11 mil. Recently our Ringgit is showing some strength, which will ease the burden too. 

By comparing 2014 and 2015, the revenue from Europe and US had increased 19% and 52% respectively. UCHITEC is successful at attracting, retaining and developing their employees. They had been actively offering Employee Share Option Scheme (ESOS) as a token of gratitude to their employees for their tireless efforts for the company. At least they are taking the welfare of their staffs, compared to the market nowadays whereby a lot of people are losing their job.

ValueCap Sdn Bhd actually emerges as their top 30 shareholders, alongside with other local and international fund houses. Look at the list below, you will see more than 20 fund houses, for example, Lembaga Tabung Haji, Public Islamic Opportunities Fund, Amanah Saham Bumiputera, Manulife Investment Fund etc etc.

UCHITEC - U SEE THAT

UCHITEC is a company which manufactures mixed signal microprocessor-based application and system integration products, and trading of complete electronic module[1]. UCHITEC had their subsidiaries in Malaysia (Uchi Optoelectronic (M) Sdn. Bhd & Uchi Electronic (M) Sdn. Bhd.) and another subsidiary in China (Uchi Technologies (Dongguan) Co., Ltd). UCHITEC is majoring in services and products. 

Their services such as product design (transforming product ideas through innovative solutions), construction and tooling design (provide customers the optimized construction and tooling designs), software + micro controller + ASIC solutions (integrating software; with UCHITEC gained their reputation through fully automatic coffee machine or a precision weighing scale), display modules solutions (specialized in LED Dot Matrix Displays and TFT Display Modules Solutions) and manufacturing services (OEM and ODM services)[2]. OEM aka Original Equipment Manufacturing whereby a company is designing and building a product based on its own specifications and then selling the product whereby ODM (Original Design Manufacturing) is designing and building a product as per another company's specifications. UCHITEC is an ODM and OEM company which can fit into the needs of their customers.

UCHITEC's products can be divided to 2 portions, which are Art of Living Group and Bio-Tech groups. UCHITEC is using IT to build a ubiquitous information society, such as a coffee machine. Next will be the Bio-Tech group, whereby commercializing health care services and biotechnology to enrich people's lives. The products of electrical and electronic appliances such as weighing scales, high end household appliances, coffee machine etc. Basically, UCHITEC draws on the wealth of experience and technology to contribute to corporate innovation.

UCHITEC serves a wide base of multi national companies, located primarily in Europe with Switzerland and Germany as major. I think their business model is quite attractive because of the ODM whereby they can fit into the needs of the customers with their expertise and experience that they have.