Last Friday night, the US market staged a mini comeback as the S&P500 Index and Dow Jones Industrial Average both made small gains of 0.3%. The Straits Times Index (SGX: ^STI) on the other hand, was not so lucky as it slid by 1.6% to 3,074. There was simply no room for refuge as most of the index?s 30 components saw losses. Only one company, Jardine Cycle & Carriage (SGX: C07), managed to eke out any gains with a 0.1% increase to $41.25. That said, for investors looking outside…
Last Friday night, the US market staged a mini comeback as the S&P500 Index and Dow Jones Industrial Average both made small gains of 0.3%. The Straits Times Index (SGX: ^STI) on the other hand, was not so lucky as it slid by 1.6% to 3,074. There was simply no room for refuge as most of the index’s 30 components saw losses. Only one company, Jardine Cycle & Carriage (SGX: C07), managed to eke out any gains with a 0.1% increase to $41.25. That said, for investors looking outside the index, there were some real strong performers. Let’s take a look at some of them.
Guthrie (SGX: G33) was a stand-out performer with a 20.7% rise to $0.88. Last Friday, the company announced that it received an acquisition offer from United SM Holdings Pte Ltd for all of its shares at a price of $0.88 apiece. United SM Holdings already owns close to 70% of Guthrie, a company with interests in; commercial, residential and retail real estate; mechanical & electrical engineering products; and ownership of hotels and a golf resort.
Prior to the acquisition-announcement, Guthrie had already gained 29.5% since 25 June 2012. With today’s rise of 20.7%, investors in the company will be laughing to the bank with a 57% return in exactly one year.
Mary Chia Holdings (SGX: 5OX) was another strong winner with its shares up by 9.6% to $0.057. The company has a very small market capitalisation just north of S$9.3m but actually posted earnings of S$13.9m in its full-year earnings release last month, reversing losses of S$2.56m for the previous year.
Was there any major improvement in operating conditions that led to the huge jump in profit? Turns out, most of the gains were due to a revaluation of the company’s investment properties which have nothing to do with the company’s core business of providing lifestyle and wellness services. That’s an example of why investors have to drill deeper when looking at the reported earnings of companies.
After looking at superlative intra-days gains, we shall be brought back down to earth with Petra Foods (SGX: P34) relatively tame 0.9% gain to $3.48. Two Mondays ago, the company announced that the proposed sale of its Cocoa Ingredients business to Europe-based chocolate manufacturer Barry Callebaut for an estimated U$950m has been given regulatory approval by European authorities. Investors will hear from Petra Foods again when the sale is completed.
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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Chong Ser Jing doesn’t own shares in any companies mentioned.