STU - Steel & Tube Holdings

[winner69]

I was really hoping to get in on STU a few weeks back (well when it was around the low $2.40's, which was only recently)... just had to get some cash together, but it also seems like Mr Market had a similar idea... likely Mr Market is expecting favorable results (which will be annouced just after mid Feb probably), like I am.

Interested in why you fancy STU

Doesn't seem your type of investment

[trader_jackson]

Interested in why you fancy STU

Doesn't seem your type of investment

In my view: Looked cheap, fundamentals improving, and further diversification

[Hoop]

..................................
Yes Hoop - a real cyclical

You in for a quick buck I hope - no long term investment?

I quick buck would be nice.....I'll be "in" for as long as STU is nice to me, so I have no idea how long, could be 1 day to 5 years who knows...I'm always jittery about holding cyclical stocks as I'm well aware how very cruel they can be to it's stockholders when they hold for too long..These types of stocks are dangerous and can turn suddenly without pre-warning..

TJ and others..I hope you take stock of Winner's doubts...remember STU is still in a long term downtrend so it is a bear, and until otherwise ..and..a bear market investing strategy (rowing) should be used....in other words this latest rally has to be seen as another sucker rally until proved otherwise...so we should watch very closely for failure signs when nearing resistance areas .....

Also note... While the NZSE has gone up about 300% during the last 8 years, STU is risen diddly squat...Investors should be aware (question) STU's management poor performance record to create shareholders capital

Yes I have questioned (see my previous post) whether this STU bear is ending, but until there is confirmation I'm watching this share a few times every day because it is nearing resistance areas...STU is at a small resistance now (I've noted this) but the one I'm focused on is the strong resistance at the old bull/bear line of the last 2014 rally of ~$2.75 - $2.80ish area...that's not far away..

[blackcap]

Also note... While the NZSE has gone up about 300% during the last 8 years, STU is risen diddly squat...Investors should be aware (question) STU's management poor performance record to create shareholders capital

.

I wonder if you add the dividends to STU's performance the last 8 years how that would compare to the NZSE which is a gross index.... could be an interesting comparison.
But yes STU if you can get in at a reasonable price will not cost too much even if held long term.

[Hoop]

I wonder if you add the dividends to STU's performance the last 8 years how that would compare to the NZSE which is a gross index.... could be an interesting comparison.
But yes STU if you can get in at a reasonable price will not cost too much even if held long term.

Good post...
Yes...When STU is compared with NZSE gross index it looks better but still bad methinks ....The gross index has recouped the 2008-2009 losses to be at a similar level as at 2007....STU shareprice is down 50% so its capital erosion...so lets say a total $2.20 per share has to be accumulated and compounded in a separate bank account during the last ten years to break even......Dividend Share reinvestment is poorer option because of the downtrend...

I had this argument thrashed out on the SPK thread.....I'm sorry but no body is going to change my mind on these capital eroding high yielding stocks as a long term investment strategy....Look at it this way....A Long term investor buying in at $5.00 and sitting on STU ever since (2007) is not getting a high yield dividend compared to nowadays, and if anything went wrong and had to sell only 50% of their capital can be realised..

If you are a long term investor the total opposite is the best play...Buying a high growth (capital appreciating) low yielding stock and after 10 years your orginal buy in is now yielding high dividends and the stock is still appreciation in price...and if you had to sell you would get 300% increase in capital back...e.g MFT...and..hindsight has little to do here as MFT has always been known as a high growth/low yielding stock...

Cyclical stocks are great in a portfolio for half of the time..Quick capital appreciation and high yielders.....Sadly the other half of the time they are capital eroders (possibly to zero) and negative yielders (need money, share dilutions,options etc)...they make lousy (very) long term investments.

[winner69]

In my view: Looked cheap, fundamentals improving, and further diversification

OK

Maybe STU are beginning to cream it at the moment after missing out badly on the current building boom

That boom coming to an end I reckon - so hoops comments are relevant as 2018/2019 could be one of those 'capital erosion' periods

[Hoop]

Price fallen sharply back to 2.55 from an intra-day high of 2.65 yesterday...could be a throwback to test its breakout (occurs ~60% of the time) then move up again (second chance buy-in)...STU is a volatile stock see my above weekly chart..more spikes than a porcupine....so a complete throwback to 2.40 breakout point would be disappointing but would not come as a complete surprise to me due to it's sudden movement volatile nature....For the optimists and hopefuls there are some slight chart supports at 2.49 and 2.45..The 2.49 support is confirmed with the current trading depth data...

Also..there is good buying support emerging at 2.58 now that those couple of sellers have left the building..... so 2.55 could be the bottom..

Disc: holding

[arc]

Price fallen sharply back to 2.55 from an intra-day high of 2.65 yesterday...could be a throwback to test its breakout (occurs ~60% of the time) then move up again (second chance buy-in)...STU is a volatile stock see my above weekly chart..more spikes than a porcupine....so a complete throwback to 2.40 breakout point would be disappointing but would not come as a complete surprise to me due to it's sudden movement volatile nature....For the optimists and hopefuls there are some slight chart supports at 2.49 and 2.45..The 2.49 support is confirmed with the current trading depth data...

Also..there is good buying support emerging at 2.58 now that those couple of sellers have left the building..... so 2.55 could be the bottom..

Disc: holding

Whats the current thoughts on STU.

[hardt]

There is some value here in the 230-240's, debt levels don't look so great.

Short-mid term looks alright, I have never been a fan of cyclical stocks though.

The dividend yield is making me light headed and I can imagine this has enticed enough retail investors to jump in.

[JoeGrogan]

There is some value here in the 230-240's, debt levels don't look so great.

Short-mid term looks alright, I have never been a fan of cyclical stocks though.

The dividend yield is making me light headed and I can imagine this has enticed enough retail investors to jump in.

Yeah with a market cap of $218 million (at 2.41) and a forecasted profit of $22 million, the PE ratio seems pretty fair with such an attractive dividend. Furthermore, $2.36 seems to be a pretty strong level of supprt.

Disc: sold out after last dividend.