If you are a fundamental investor, your goal is to find a good company trading at a discount to its business value. The challenge is having the expertise and time to do the detailed analysis to find such stocks. This is where the Fundamental Mapper comes in. This is an app design for the layman investor to give him a picture of the relative fundamental performance of a company as well as its investment risk. The position of a stock relative to its sector peer is mapped onto 4 quadrants as illustrated. The goal is to hunt for companies in the Goldmine quadrant. These are fundamentally sound companies with low investment risk. The performance is based on the past 6 years financial data while the investment risk is based on comparing the business value with the current market price. A low ris

Over the past few months, I have been working with an social investment platform to develop an app that plots the fundamental performance of Bursa Malaysia companies on the horizontal axis and the investment risk (intrinsic value compared to market price) on the vertical axis. This Fundamental Mapper aims to simplify the fundamental analysis by visually presenting the standing of a company relative to others within the sector as illustrated below. The investment risk is updated daily while the fundamental analysis is updated quarterly. It is currently at the Beta testing stage but I would like to get feedback and comments on the Fundamental Mapper - what is wrong with it, what else would you want to see, etc

Aptar (NYSE: ATR) creates dosing, dispensing and packaging products for the global beauty and phara sectors. Over the past 10 years, its revenue grew at revenue grew at 3.7% CAGR while PAT grew at 5.2% CAGR. You would think that with top line and bottom line growth, this would be a good performance. However, it ROE its 2023 was about the same as that in 2012. This standstill return was because there was declining operating and capital efficiency. As an investor, your focus is on profitability. The market is not going to re-rate the company is the growth is because it is using disproportionately more assets and capital to grow revenue and earnings. Moral of the story? Do let companies distract you with the wrong metrics. Is Aptar then a terrible investment? Find out more on page 20 of INV

Ternium is a South American steel company. Although it has some mining operations, these serve mainly in-house and are a small component relative to the steel output. It achieved revenue and profit growth through organic growth and acquisitions over the past 11 years. It has a strong financial position and a good capital allocation plan, creating value for shareholders. A Valuation based on the steel price cycle shows a sufficient margin of safety, making it an investment opportunity. If you are already invested in steel companies, this might be a good geographical diversification

Silgan (SLGN) is a leading manufacturer of sustainable rigid packaging solutions for the world. Its revenue and earnings have grown through acquisitions and price growth, rather than organic growth or volume growth. It has a high debt-equity ratio and no signs of strong fundamentals as there were no uptrends in ROE and operating parameters. There is no margin of safety at the current high product selling prices. With an unsustainable Reinvestment rate, it is not an investment opportunity. I screen for US stocks frequently but not all are investment opportunities like SLGN.

Boise Cascade or BCC is one of the largest producers of engineered wood products and plywood in North America. Its growth in PAT over the past decade was driven mostly by the past 2 years' outlier product prices, which have since declined. The company is fundamentally sound with strong financials. BCC is a cyclical company heavily influenced by the housing sector, and valuations based on probability-weighting the outlier prices show no margin of safety.

Ever since coming across an article suggesting that the packaging sector would benefit from the growth of online retailing, I have been hunting for packing companies. My search went beyond Bursa and included US. Why the US? In 2023, the total return (dividend + capital gain) for the Bursa KLCI was about 3%. The S&P 500 achieved 26%. Even accounting for forex losses, you can see why the US is better. But this does not mean buying blindly. You still need to do fundamental analysis. Take the example of Avery. This is NYSE a global materials science and digital identification solutions company. Despite its acquisitions, its revenue only grew at 4.4% CAGR over the past 10 years. While ROE and net margins have been trending up, there were no improvements in other operating parameters, I th

I have a simple framework to classify each stocks. After I have done a fundamental analysis and valuation, I see which cell it falls into based on the matrix shown below. The cells are formed by the combination of margin of safety on the horizontal axis and business fundamentals on the vertical axis. Conceptually Cell A – best investment opportunity Cell B – this could be Warren Buffet “wonderful company at fair price” Cell C – Ben Graham “cigar-butt” investment Cell D – avoid

Aptar is a US packaging company that is global leader in drug delivery, consumer product dispensing, and active material science solutions. It achieved revenue and profit growth over the past 11 years, but its ROE in 2022 was what it was in 2012. This was because its operating efficiencies have been declining This is not an investment opportunity

In his book, “The Success Equation”, Mauboussin opined that a lot of activities fall along a spectrum with pure luck one end and pure skill on the other end. Chess is an example of an activity that depends on pure skill to win. The lottery is an example of an activity on the other end of the spectrum that requires pure luck to win. Most activities fall in between these two ends. He puts investing nearer the pure luck side What does this mean for the investor? If you invest blindly, you are depending on pure luck. Those with the investing skills will do better than those who invest blindly. Conceptually you want to be the casino owner with the better odds on your side rather than the casino guests. You can achieve this by developing your investing skills. The best way to develop your inves

Advance Drainage Systems (NYSE: WMS) is the leading manufacturer of innovative water management solutions. WMS achieved 12.7% CAGR revenue growth over the past 9 years, driven by acquisitions and the past 2 years of high product prices. This led to growing ROE and gross profitability. The growth in revenue and profitability is not sustainable. I also have concerns about the company's financial strengths. A valuation assuming that the high price situation persists did not provide a margin of safety.