SIP

[Jac]

Any ideas behind the recent weakness ?

[shasta]

Any ideas behind the recent weakness ?

Not sure but at $1.10 i'm in.

Have been looking for a relatively "cheap" healthcare type stock & despite the market having taken a pounding this year, many of it's peers are still commanding rich P/E's.

A very defensive sector to be in.

[STRAT]

Not sure if Jac is still expecting an answer to that question Shasta but better late than never. Right? :D

[shasta]

Not sure if Jac was expecting an answer to that question Shasta but better late than never. Right? :D

Actually i didnt look at the date & im stunned there was a thread!

[macduffy]

Hi shasta.

Interesting that you have chosen now to buy SIP.

I've been following it off and on for 2 years or so and its SP has been pretty subdued for most of that time; its been having problems even when the rest of the market was booming.
Big issues around govt payments for pharmaceuticals, competition from a newcomer Indian firm, industry rationalisation and profitability, as I recall.
Can I ask what attracted you at this time?

[shasta]

Hi shasta.

Interesting that you have chosen now to buy SIP.

I've been following it off and on for 2 years or so and its SP has been pretty subdued for most of that time; its been having problems even when the rest of the market was booming.
Big issues around govt payments for pharmaceuticals, competition from a newcomer Indian firm, industry rationalisation and profitability, as I recall.
Can I ask what attracted you at this time?

Yes you can, & i'll post the reasons why shortly ;)

[shasta]

Hi shasta.

Interesting that you have chosen now to buy SIP.

I've been following it off and on for 2 years or so and its SP has been pretty subdued for most of that time; its been having problems even when the rest of the market was booming.
Big issues around govt payments for pharmaceuticals, competition from a newcomer Indian firm, industry rationalisation and profitability, as I recall.
Can I ask what attracted you at this time?

Lets start with the fundie stuff...

SIP has forecast FY10 eps of 10.6c, which puts it on a reasonable forward P/E of 10.7 (dividend forecast at 8c = 7% yield).

Debt gearing level is comfortable at 36.5%, & has been renegotiated so its main loans have been pushed out to 2011.

Earnings stability is way above the sector norm (68% v 46% av.)

Barclays Group have recently become a SSH (Not always a good thing with them, after there bath on resources!).

Here's the recent media release on there full year results...

http://www.sigmaco.com.au/content/707266.pdf

Points of note: (Mainly Non financial stuff)

1. New products coming online (page 7)
2. Sigma's IP & its potential in developing markets (page 9)
3. Weight loss program, should do well in NZ (god we are getting fat as a society & less active!) - see page 13.
4. Page 19 refers to the level of franking credits available for future dividends
5. 5 year strategic plan outlined on page 20
6. Diversified nature outlined on page 21, so any regulations put on the pharmaceuticals side of the business can be partially negated.
7. Strong brands- ie Amcal is well known in NZ/Australia
8. We are fast becoming a chemical dependent society, we are all taking more & more pills, its a fast growing industry, even if competitive!

And now the chart (AA knows i like candles so here goes)

SIP travelling nicely above the 30 & 90 day moving average & the large volume spike from Barclays set it up...

http://www.directbroking.co.nz/cgi-bin/sparkle.dll/superchart?template=dblsuperchart&session=0&instrument=SIP&exchange=ASX&period=1Y&adj=yes&vs=LINE&ct=CANDLE&compi=&ma1=30&ma2=90&bb=&ind=MACD&ra=2

[Phaedrus]

Sorry Shasta, no Candles on this chart - the time frames just too long....my chart covers a span of 2 years and 6 months, too long to see candles in detail.
This "problem" is very easily solved, AA. All you have to do is use weekly candlesticks. Here is a chart of the same time period and you can see the candle detail quite clearly.

http://h1.ripway.com/78963/SIP43.gif

Shasta. Weekly candlesticks are really useful and I recommend them to you. Signals derived from their use are MUCH more reliable than those derived from daily candlesticks and would in any case be more appropriate for a rather "longer term" player such as yourself.

Technically, you have bought into SIP too soon. Time will tell whether you have been brave or foolish, but from my perspective, SIP is still in the very clear "medium-term" downtrend that started back in September of last year. It has been making lower lows and lower highs ever since then.

[shasta]

This "problem" is very easily solved, AA. All you have to do is use weekly candlesticks. Here is a chart of the same time period and you can see the candle detail quite clearly.

http://h1.ripway.com/78963/SIP43.gif

Shasta. Weekly candlesticks are really useful and I recommend them to you. Signals derived from their use are MUCH more reliable than those derived from daily candlesticks and would in any case be more appropriate for a rather "longer term" player such as yourself.

Technically, you have bought into SIP too soon. Time will tell whether you have been brave or foolish, but from my perspective, SIP is still in the very clear "medium-term" downtrend that started back in September of last year. It has been making lower lows and lower highs ever since then.

Appreciate the feedback AA/Phaedrus

Am trying to implement some more TA into my buy/sell decisions, i understand candlesticks better than other TA signals...

I'm not trading SIP, & do have a habit of picking reversals before they happen ;)

[macduffy]

Hi shasta.

Belated thanks for your discussion/analysis of SIP.
I've been following them for a while, attracted by the "health stock" angle in the main but instead took a small position in Probiotic (PBP) about 12-18 months ago. Similar type of business but a much smaller company and without the direct relationship with pharmacies.
I've also put a few dollars in Cellestis (CST) an interesting spin off from CSIRO I think it was, some years ago. They have developed a blood test for TB which is slowly gaining acceptance as a more reliable test than the Mantoux skin test for the disease. Recently turned their first profit and paid a maiden dividend.
I was wondering if you had come across either of these companies in your health stock research and if so what were your thoughts.

Cheers

:)

[shasta]

[quote=macduffy;250194]Hi shasta.

Belated thanks for your discussion/analysis of SIP.
I've been following them for a while, attracted by the "health stock" angle in the main but instead took a small position in Probiotic (PBP) about 12-18 months ago. Similar type of business but a much smaller company and without the direct relationship with pharmacies.
I've also put a few dollars in Cellestis (CST) an interesting spin off from CSIRO I think it was, some years ago. They have developed a blood test for TB which is slowly gaining acceptance as a more reliable test than the Mantoux skin test for the disease. Recently turned their first profit and paid a maiden dividend.
I was wondering if you had come across either of these companies in your health stock research and if so what were your thoughts.

Cheers :)

Yes, both came up when i did my DD thru the Healthcare sector, both are much smaller companies than SIP, & i was after a bigger player with size & scale, & SIP fits that bill.

I've never invested into biotech type stocks, as it's an area i do not understand, therefore am not comfortable with it.

One thing i did notice was that all the retirement/healthcare plays are still quite "expensive" on a P/E basis, & have weathered the financial crisis fairly well.

Seems my buy snuck me in for the 4cps divvie on SIP too :D

[macduffy]

Thanks for your thoughts, shasta.

Yes, biotech/healthcare stocks are rather expensive on a P/E basis, although PBP is hardly biotech, being more a pharma manufacturing stock. The thing that attracted me to them apart from their earnings growth from a low base was their increasing emphasis on "own brand" products where the profit margin is much higher than on contract manufacturing. Like SIP, they have their own weight control products, Slimm and Celebrity Slim which are sold through Woolworths and Coles supermarkets in Australia. They've also recently brought out a new replacement meal product called "The Biggest loser Club" which is stocked in all Coles and Woolies stores. Sounds like a terrible brand name to me but I imagine they've done their marketing research!
I realise that all this would be discussed more appropriately on the PBP thread so will leave it at that but must note the 73% increase in latest interim profit!

;)

Cheers

[shasta]

Thanks for your thoughts, shasta.

Yes, biotech/healthcare stocks are rather expensive on a P/E basis, although PBP is hardly biotech, being more a pharma manufacturing stock. The thing that attracted me to them apart from their earnings growth from a low base was their increasing emphasis on "own brand" products where the profit margin is much higher than on contract manufacturing. Like SIP, they have their own weight control products, Slimm and Celebrity Slim which are sold through Woolworths and Coles supermarkets in Australia. They've also recently brought out a new replacement meal product called "The Biggest loser Club" which is stocked in all Coles and Woolies stores. Sounds like a terrible brand name to me but I imagine they've done their marketing research!
I realise that all this would be discussed more appropriately on the PBP thread so will leave it at that but must note the 73% increase in latest interim profit!

;)

Cheers

Thanks for bringing PBP to our attention!

I track so many stocks at one time, i can only pick a few in the sectors i don't follow as closely as others.

Healthcare is a fairly safe bet for the mid-long term.

I did look closely at AVE in the Healthcare/Retirement category, but it didn't meet my criteria.

[Footsie]

pbp is a top performer... held them for years

[shasta]

pbp is a top performer... held them for years

SIP - Annual Report to Shareholders

http://www.stocknessmonster.com/news-item?S=SIP&E=ASX&N=316430

104 pages, but a good overview none the less

PS, Buy all your prescriptions from Amcal Pharmacies :D

[shasta]

SIP - Annual Report to Shareholders

http://www.stocknessmonster.com/news-item?S=SIP&E=ASX&N=316430

104 pages, but a good overview none the less

PS, Buy all your prescriptions from Amcal Pharmacies :D

With this new "pandemic" of swine flu, SIP has a large range of pharmaceuticals that it makes, & distributes through it's wholesalers

http://www.sigmaco.com.au/prescription.cfm

I've got some Temazepam myself :D

I'm expecting an over reaction to all this & for SIP to benefit :D

PS, Get all your "Swine Flu" items from Amcal Pharmacies!

[shasta]

With this new "pandemic" of swine flu, SIP has a large range of pharmaceuticals that it makes, & distributes through it's wholesalers

http://www.sigmaco.com.au/prescription.cfm

I've got some Temazepam myself :D

I'm expecting an over reaction to all this & for SIP to benefit :D

PS, Get all your "Swine Flu" items from Amcal Pharmacies!

SIP - Dividend Reinvestment Plan (incl 2.5% discount)

http://www.stocknessmonster.com/news-item?S=SIP&E=ASX&N=317087

Normally i'd participate in a DRP especially with even a small discount, but this time i'll happily add the cash to the pile looking for a new home.

[macduffy]

A bit off topic but the subject of DRP's is an interesting one.
I'm normally a starter for them too, taking the view that if I think that a stock is worth holding then an offer to buy a few more without brokerage and often at a small discount, is worth taking advantage of. A decision not to, should have me questioning whether I should sell the holding and buy something else.
It doesn't always work that way of course and sometimes the reason is that I'm under water with the stock, don't want to add but unwilling to sell.
:(

I'd be interested in your thoughts on this one shasta, -and anyone else of course.

Meanwhile, SIP is finding that it's an ill wind that blows no good.

[shasta]

A bit off topic but the subject of DRP's is an interesting one.
I'm normally a starter for them too, taking the view that if I think that a stock is worth holding then an offer to buy a few more without brokerage and often at a small discount, is worth taking advantage of. A decision not to, should have me questioning whether I should sell the holding and buy something else.
It doesn't always work that way of course and sometimes the reason is that I'm under water with the stock, don't want to add but unwilling to sell.
:(

I'd be interested in your thoughts on this one shasta, -and anyone else of course.

Meanwhile, SIP is finding that it's an ill wind that blows no good.

Despite most dividend paying companies with debt, reducing there dividends, (& i agree totally with this practice) in a bear market i'm happy investing into companies who pay out dividends, so long as it's from operating cashflows & they are generating sufficient cashflows to support reinvestment into the business (I'm big on the "allocation of capital" ;))

I agree with your thoughts, but i've invested into SIP the amount i wanted to (approx 20% of available funds), & i'll use the cash from the divvie to add to existing funds awaiting a new home.

Part of my recently "refined" system, means holding cash & sticking to target prices. If there's nothing i like at my price then i will sit & wait until a company that passes my criteria, meets my entry price.

Am trying to implement candlesticks into buy/sell decisions, & yes i did jump the gun a bit on SIP :o (refer chart earlier in the thread)

I've got FEA & CWT on close watch, & both are getting closer to my target price. Both off the radar & "unsexy" businesses, but i see the upside in them :rolleyes:

5 stocks is about as diversified as i will ever get!

I do want some exposure to the healthcare sector & SIP provides that

I may hold this stock for a while, or dump it straight away if the SP heads south on an ugly chart.

[macduffy]

May be some good news here for SIP.

The cholesterol lowering drug, simvastatin, is currently supplied by Pharmac in the form of MSD's Lipex. As from 1 May, an alternative called Arrow-Simva will be avaiable fully subsidised and from 1 August will be the only fully subsidised simvastatin.
Arrow is a subsidiary of SIP but I don't see the name "Arrow-Simva" appearing anywhere on Sigma's web-site.
Can anyone confirm SIP's involvement here?

Meanwhile, SIP had another good day yesterday in a strong market.

Disc: Not holding but interested.

[shasta]

May be some good news here for SIP.

The cholesterol lowering drug, simvastatin, is currently supplied by Pharmac in the form of MSD's Lipex. As from 1 May, an alternative called Arrow-Simva will be avaiable fully subsidised and from 1 August will be the only fully subsidised simvastatin.
Arrow is a subsidiary of SIP but I don't see the name "Arrow-Simva" appearing anywhere on Sigma's web-site.
Can anyone confirm SIP's involvement here?

Meanwhile, SIP had another good day yesterday in a strong market.

Disc: Not holding but interested.

Check out this link

http://www.arrowpharma.com/index.cfm

[macduffy]

Thanks, shasta, but I've been there and couldn't get past the "log in " window.
Am I missing something?

:confused:

[shasta]

Thanks, shasta, but I've been there and couldn't get past the "log in " window.
Am I missing something?

:confused:

Sorry, i didn't realise you had to login to get any further.

I do believe there is a tie up somewhere, but i'm not giving any credit card details, shareholder or not!

[macduffy]

Pharmac tell me that:

"Arrow-Simva is marketed by the New Zealand based Arrow Pharmaceuticals and it is made in Canada."

Not so sure about the "New Zealand based " bit but I guess Arrow Pharmaceuticals is the New Zealand subsidiary of Sigma/Arrow?

[shasta]

Pharmac tell me that:

"Arrow-Simva is marketed by the New Zealand based Arrow Pharmaceuticals and it is made in Canada."

Not so sure about the "New Zealand based " bit but I guess Arrow Pharmaceuticals is the New Zealand subsidiary of Sigma/Arrow?

That's correct, the Sigma website kind of distances itself from Arrow, even though they are on the same team!

I guess it's just brand protection?

[shasta]

That's correct, the Sigma website kind of distances itself from Arrow, even though they are on the same team!

I guess it's just brand protection?

SIP has gone ex dividend, & will pay a fully franked A4c tomorrow, if anyone was thinking today's SP drop was significant.

I'm watching & ready to bail should it drop too much more though...

Have plenty of targets, so a small loss can be recouped very quickly!

[shasta]

SIP has gone ex dividend, & will pay a fully franked A4c tomorrow, if anyone was thinking today's SP drop was significant.

I'm watching & ready to bail should it drop too much more though...

Have plenty of targets, so a small loss can be recouped very quickly!

Whilst i get the dividend, my pre set stop loss took me out :eek:

Doesn't mean i have changed my mind, just hoping to get back in on the way up.

With GMI i timed the candlesticks perfectly, with SIP i acted too soon.

FEA & NZO got the funds :D

[Dr_Who]

I am thinking of picking up some SIP at $1.07.

Any advice?

[OldRider]

Perhaps SIP is at the start of a growth phase, I don't know, I have just sold a parcel I held. First purchased in June 01 half sold in March 02 after doubling of price to make remaining holding free carried,

Since that time the price is little changed over the 7 years, dividend yield has been round 6%. My data gives book value of $1.38, NTA -16c (negative), intangibles are greater than equity, there was a shares split in 2005 which sometimes does mess up data, this may be normal for pharmaceuticals, but they reached the bottom of my company performance list, so were sold - cash went into increasing CSL which has performed better in same health sector.

[macduffy]

I am thinking of picking up some SIP at $1.07.

Any advice?

It's a tough sector, doc, with govts pushing down on pharmaceutical costs.
Although SIP has a strong position in Aust, competition is strong with a recent Indian competitor keeping margins down. I looked at SIP last year and concluded that it didn't have the potential upside of some other "medical" stocks such as CST and PBP.

Not advice, but those two, not competitors but in a similar sector, might be worth a look, alongside SIP.

[Dr_Who]

Thanks AA and Mcduffy.

I bought some at $1.07 for a trade. Only a small amount.

[shasta]

Thanks AA and Mcduffy.

I bought some at $1.07 for a trade. Only a small amount.

For what it's worth, i looked thru the healthcare sector & went with SIP a while back, i sold at the bottom & then it rebounded, go figure :rolleyes:

I know some of there products & in a chemical dependent society, SIP make & distribute there own prescription meds, in pharmacies throughout NZ & Australia.

Not cheap, but maybe even slightly undervalued, with potential ;)

[Dr_Who]

I need some health sector exposure in my portfolio. My broker was having a go at me for having far too many resource stocks... LOL... hey resources have been good to me this year. ;)

[Dr_Who]

I like the fact that SIP are using the funds for growth. This is a good time to acquire undervalued company for growth.

AA.... lol... good brokers have their place. I dont mind paying abit more fees for good advice, research and hassle free execution.

[macduffy]

"Sharebrokers Cannot Get Excited About Sigma"

http://www.fnarena.com/index2.cfm?type=dsp_newsitem&n=97F48BDC-1871-E587-E1B81BB2939DF308

But as we know, doc, they're as often wrong as everyone else!

;)

[Dr_Who]

Who needs Myers and Kathmandu when you can get your hands on SIP? SIP is much cheaper and gives better div yield.

SIP at current sp is trading at a PE of 11x and div 6.7%. It went ex div this week with a nice 3cps. They recently raised funds for growth acquisition and to reduce debt.

The Doc is gonna buy more SIP when/if it bottoms out.

[macduffy]

Has the Aust govt announced the result of its review of pharmaceutical payments yet?

I'd be a bit careful of that.

;)

[h2so4]

SIP now has 1166m shares on offer. It has a low cash yield and it is probably fairly priced at around a buck. But then again SIP has increased it's shareholder equity from $.18 in 2001 to $1.35 in 2007. Since then it has only fallen and with the recent share issue and the fact that it seems headed for tough times it will continue to fall. It's a pass for me. You could look at ANN

[macduffy]

SIP now has 1166m shares on offer. It has a low cash yield and it is probably fairly priced at around a buck. But then again SIP has increased it's shareholder equity from $.18 in 2001 to $1.35 in 2007. Since then it has only fallen and with the recent share issue and the fact that it seems headed for tough times it will continue to fall. It's a pass for me. You could look at ANN

Note also that SIP has negative NTA.

Equity $1214.8m, Intangibles $1317.8m.

Disc: Former shareholder of SIP, now invested in PBP.

[Dr_Who]

Thanks for the advice guys.

I think the sp at these levels have factored into possible govt changes to the poilcy. Well, I hope so.

[shasta]

Thanks for the advice guys.

I think the sp at these levels have factored into possible govt changes to the poilcy. Well, I hope so.

I still like what i originally saw in SIP, looks cheap to me

Have been "sampling" one of there products of late :D

[Anna Naum]

I might have this wrong but I thought that DB as underwriter to the recent rts issue ended up owning a bunch of shares that have yet to find a 'final' holder. Might explain (if I am right) why the stock price is having a few problems and looks 'cheap'

[macduffy]

It's correct that only 32% of the retail offer was taken up by shareholders but the shortfall was placed in a bookbuild. So DB, as underwriter, isn't holding these shares but we don't know who is/are and whether or not they are "firm" holders.

:confused:

[Dr_Who]

Hard to tell these days what is going on behind the scene with instos playing silly games with the sp. I recall BLY had a huge retail overhang on closing date and the insto took all the shares, yet BLY sp is doing very well.

I suppose if SIP can continue to retain their earnings guidance then div is safe. From viewing the other pharma results like API etc I dont see why SIP cant maintain their earnings guidance, esp with the Aust economy recovering so quickly.

[drillfix]

Man, what a sell off, talk about catch falling knife, this is falling Machette'

Hope some folks got out prior to the big bang and not looking too good, imo

[shasta]

Man, what a sell off, talk about catch falling knife, this is falling Machette'

Hope some folks got out prior to the big bang and not looking too good, imo

Surely this is the final reporting season where all the skeletons are brought out in the open, with regards to write downs?

The market harshly knocked the stuffing out of SIP, a bit of an over reaction, reminds me off WDS

Probably a traders play thing for a while now

[winner69]

Harsh response eh .... good gains for those caught the machete at the open ... not me though

[drillfix]

Surely this is the final reporting season where all the skeletons are brought out in the open, with regards to write downs?

The market harshly knocked the stuffing out of SIP, a bit of an over reaction, reminds me off WDS

Probably a traders play thing for a while now

Your not wrong about that Shasta, been a few co's that have taken a pretty big hit, another one TOL which seems to be climbing its way back "slowly".


Harsh response eh .... good gains for those caught the machete at the open ... not me though

Hey winner, c'mon mate, I heard you got a pair of steel gloves specially designed to catch machete. :P lol

[Dr_Who]

Phew, lucky I sold out before the trading halt.

[evilroyrule]

im in at 43. might get before tomorrow. trying to digest report now. surely cant all be impairmed goodwill. actual sales up??

[h2so4]

im in at 43. might get before tomorrow. trying to digest report now. surely cant all be impairmed goodwill. actual sales up??

Talk to your Dr. first mate.

[drillfix]

Surely this is the final reporting season where all the skeletons are brought out in the open, with regards to write downs?

The market harshly knocked the stuffing out of SIP, a bit of an over reaction, reminds me off WDS

Probably a traders play thing for a while now


im in at 43. might get before tomorrow. trying to digest report now. surely cant all be impairmed goodwill. actual sales up??

ER mate, you seem to have a thing about falling stocks and the number 43. LOL What's with that??

To be honest ER, the indicators are pointing down even after the fall.

W%R is touched past the lower 80 line, but it still could go "much lower", RSI is at 8.518 which is totally ass wiped adn the stochs have only started to touch the lower 20 line.

What does this mean you may ask? Well, it means (IMO) that is going to continue down, but may also trade upwards for a short while.

If it were me who caught that, I would be targeting my exit point tomorrow either on open or as soon as the Intraday shows an upward pressure.

Good luck with that one and you definitely have Machete gloves :P



Phew, lucky I sold out before the trading halt.

Wow Doc, you must have the magic touch, good to see your intuition is fully in check~!

[evilroyrule]

no sweat drilly, a pure longshot really, based solely on likelihood of over reaction. had a tidy profit from the cricket. gone "all up" if you like. maybe as well as the bullish outbreaks on your intra day page you could post for me the biggest fallers???

[evilroyrule]

hello evil my needle. got a sell in at 51. going to be close....

[drillfix]

ER, try waking it on at 48.5 @ the 50% Fib line.

Better still, as its the afternoon session and Easter break make it 48c to get a better chance on get out, as who knows where this could end today.

IMO.

[evilroyrule]

drill, following yesterdays action how is SIP looking going forward?

[drillfix]

drill, following yesterdays action how is SIP looking going forward?

Hi ER,

Fundamentally? Lord knows. IMO Technically? Well, I think this will do exactly what most stocks do, when they have done what they have previously done, which is IMO, Trade Sideways with impulse bursts at unpredictable times every so often to keep them looking interesting.

CXS you already know and see, though also take a look at TOL. These stocks "slowly" grind their way back up to the FIB levels, unless the FA turns nasty and knocks it right back down even further.

So ask yourself this ER, why are you in this SIP trade? To see the stock jump back to previous levels? I hope not. it will climb the FIB lines, slowly.

48.5c = 50% fib
51c = 38.2% fib
54c = 23.6% fib
59c = 0.00% fib

and so on
But go the other way and this:

46c = 61.8% fib
38c = 100% fib

Question is, what sort of return are you anticipating? Whatever ever it is, it will need news, or it will need to wait and "slowly" get there. IMO

Hope this helps buddy :)

[evilroyrule]

thanks drilly. explain this plse, 48.5c = 50% fib. what does the 50% relate to?

[drillfix]

thanks drilly. explain this plse, 48.5c = 50% fib. what does the 50% relate to?

Well ok briefly,

There are a few ways to use Fibonacci retracements.

In this instant I am referring to SIP on the 31st of March when it opened at 59c and then fell to 38c

I use a Fib tool to draw a high and draw a low ( 0% - 100% ) that creates a range.
Between that range are Fib % numbers where the prices I previously specified.
The stock will then trade in between whatever % range it finds itself in for a duration which lord knows how long that is.
Should the stock break above the range, we then revert to the a previous range which would be:

The last trade or low Prior to the fall, which would then give us a more longer term potential target views.

Not sure if this clearly explains, but I suggest you research Fibonacci to get a full understanding on where, when and how it can be used.

In the meantime, I hope that helps~!

[winner69]

Drill - you calculate the fibs based on one days trading but mention they can give 'us a more longer term potentail target'

In my view the fibs you have calculated based on waht happened on 31/3 are really only meaningful for action on that day ... ie useful for your intraday trading. Some days on they don't have much relevance.

Looking at more longer tragets .... actually short term ones .... I would use fibs based on the 90 it was before the announcement at 90 and the lowest close since bing 41 .... that ps how much the stock fell from a high to a low .....a 50% level being 66 cents etc

What you think?

[drillfix]

Hi Winner,
Yep, was a day calculation from the previous chart, basically only the day of the fall.

But with regards to 90c to 40, giving 50% FIB, that really depends on your system W.

If I were a holder more long term, I would have gone down your choice, but I would also use the low and not the Open which you seem to have done. Which means 90 to 38c would give you a 50% Fib of 64c, rather like a 66c as you point out. so really, not much change to such a degree and small change in the scheme of things.

My point is that on that day for SIP, it will emulate just like most stocks that this happens to. Of course its numbers and people that are toggling up and down those Fib lines so basically if there were say some news that said they were now had XZY plan which will turn the table, then the FIB numbers wont matter much.

For those who mostly go long then there is FIB on the Weekly Chart going back many months or even years, which can also work quite well, therefore it becomes an effective tool for the technical toolbox as you already know.

Anyway W, thats my take of it.

By chance do you hold this stock at all Winner?


ps: will do a XAO weekly with fib in the Blood thread, check it out, freaky stuff :P

[winner69]

Drill ... no don't have any SIP at the mo .... will see how things pan out and as more of a medium to long term holder will wait for a confirmed uptrend ... patience is the key

Different from you mate .... you seem to be in boots and all from day one

When the ASX closes suppose you are into the forex markets to keep the rush going

[drillfix]

Drill ... no don't have any SIP at the mo .... will see how things pan out and as more of a medium to long term holder will wait for a confirmed uptrend ... patience is the key

Different from you mate .... you seem to be in boots and all from day one
When the ASX closes suppose you are into the forex markets to keep the rush going

Your right about patience there Winner.

No boots and all for me on this one, as I never entered a position, I did watch the action though. I like to witness the unfolding to monitor the actions and results whilst in motion, I find it helps me play it out in my head what would I have done, or potentially could/should have done, so its basically a learning experience to still watch.

Not much of a rush trading, but tick or 1 minute intraday tends to make your heart beat faster. Funny enough though, if I want my heart to slow down you can just focus on a 5 minute chart instead, but saying that, when you enter a trade, make sure you trade the one your entered on and dont allow your self to switch between the two, or three. As in, Enter on a 3 minute, Exit on a 3 minute.

Forex? Not yet, currently setting up another account with another broker whereby it does allow me to trade Direct Access to other markets and instruments.

Interesting times ahead me thinks :P

[macduffy]

A nasty day in the market but there's always something happening!

SIP has received a " non-binding, conditional and indicative" approach at 60 cents. SP has jumped 40% to 50c.

Any takers?

Disc: Not holding.

[h2so4]

A nasty day in the market but there's always something happening!

SIP has received a " non-binding, conditional and indicative" approach at 60 cents. SP has jumped 40% to 50c.

Any takers?

Disc: Not holding.
I talked to my Dr. again today and he said no, so I pass.

Its always good to get your Drs. advice.:)

[macduffy]

At least the other party has now been identified.

http://www.smh.com.au/business/sigma-play-would-give-aspen-top-spot-20100523-w40y.html

Despite Dr's advice, might be worth a small punt with a tight trailing stop? Will see what the market says on opening.

[OldRider]

I held a few years ago, sold on poor fundamentals, I haven't taken much notice of company lately except to
notice significant decline in price since then.
I don't have latest stats but can't see where much will have changed, suggest looking at a comparison
between BV and NTA, together with liabilities could provide food for thought.

[h2so4]

A nasty day in the market but there's always something happening!

SIP has received a " non-binding, conditional and indicative" approach at 60 cents. SP has jumped 40% to 50c.

Any takers?

Disc: Not holding.
Put some money in today. Currently a 50% split

[crooky]

also having a go at it as well , went at it last Friday.

[macduffy]

Speculation in the Aussie press that the Aspen bid may not proceed probably accounts for current SP weakness.

http://www.theaustralian.com.au/business/doubts-over-south-african-bid-for-sigma/story-e6frg8zx-1225888231082

[Dr_Who]

Unfortunately, a number of T/O bidders have pulled out lately.

[Dr_Who]

Aspen have asked for yet another extension. There is talks that Aspen wants to lower bid and have been negotiating with the board.

http://www.businessweek.com/news/2010-07-05/aspen-said-to-lower-offer-for-sigma-as-talks-hinge-on-price.html

[Dr_Who]

Aspen has lodge a conditional formal proposal for SIP @ 55 cents.

http://www.asx.com.au/asxpdf/20100707/pdf/31r6ncqccjd1j4.pdf

[h2so4]

Put some money in today. Currently a 50% split

Sold today. But keeping an eye on it

[macduffy]

This thread seems to have gone to sleep recently. A bit odd, seeing that the SIP board have virtually agreed to sell the Pharmaceutical division to Aspen for $900m, retaining the other parts of the business.

If/when the deal goes through, SIP will be debt-free. The big question then will be whether or not the remaining business is big and strong enough to support a company with SIP's current M/Cap of over $500m and then provide some growth.

I held SIP several years ago although havn't been a fan recently. Might be worth digging a bit deeper to see whether it's time to return?

[lewinsky]

I bought at 48c hoping for the 60c takeover, but accepted 52.5cents.

I think it is too early to go back in, as I think they now need to sort out whats left and where to from here.

I will keep half an eye on this, but think there may be better opportunities out there at the moment.

LEW

[h2so4]

This thread seems to have gone to sleep recently. A bit odd, seeing that the SIP board have virtually agreed to sell the Pharmaceutical division to Aspen for $900m, retaining the other parts of the business.

If/when the deal goes through, SIP will be debt-free. The big question then will be whether or not the remaining business is big and strong enough to support a company with SIP's current M/Cap of over $500m and then provide some growth.

I held SIP several years ago although havn't been a fan recently. Might be worth digging a bit deeper to see whether it's time to return?

It's an interesting question. How do you work that one out?

[macduffy]

It's an interesting question. How do you work that one out?

A very good question, h2!

I was hoping that someone had already done some of the spade work on it! I suspect that lewinsky is right and that there are better opportunities out there but I may not be able to resist having a go at getting some answers!

For example, the Healthcare segment, which SIP will retain, includes wholesale distribution and "retail banner management" - whatever that involves - for groups including Amcal and Guardian. It had net sales of $2.5b in the year ended 31 Jan 2010 - 79% of group revenue - and EBIT of $67.9m - 40% of group. Of course, SIP wrote off over $400m in goodwill impairment so the bottom line across the group was a hefty loss.

The big question remains. Is the "remnant" of the company over or under valued at current levels?

[h2so4]

A very good question, h2!

I was hoping that someone had already done some of the spade work on it! I suspect that lewinsky is right and that there are better opportunities out there but I may not be able to resist having a go at getting some answers!

For example, the Healthcare segment, which SIP will retain, includes wholesale distribution and "retail banner management" - whatever that involves - for groups including Amcal and Guardian. It had net sales of $2.5b in the year ended 31 Jan 2010 - 79% of group revenue - and EBIT of $67.9m - 40% of group. Of course, SIP wrote off over $400m in goodwill impairment so the bottom line across the group was a hefty loss.

The big question remains. Is the "remnant" of the company over or under valued at current levels?
So we have 79% of the revenue and no debt. Thats got to be worth something.

[macduffy]

So we have 79% of the revenue and no debt. Thats got to be worth something.

Yes, but is it worth the $553m M/Cap that the market is currently valuing SIP at?

[h2so4]

Yes, but is it worth the $553m M/Cap that the market is currently valuing SIP at?

Aspen don't think so. The original offer was $700m for the whole company. So in this case less is more or more is less, depends how you look at it.

[macduffy]

I've concluded that SIP isn't an attractive enough bargain at 47.5c.

Assigning a nominal P/E of say 10, they would need to earn around $55m NPAT to justify current SP. Whether or not this is realistic for what will remain of SIP, I guess we'll have to wait and see!

[soulman]

Nice result out today with the special dividend. Net cash of about $110 mil. Business are profitable.

I am in today.