Thursday, February 20, 2014

Jobst: One last chance to milk the cow? (Revised with inputs from others)

Jobstreet just announced that it has been offered by Seek to buy Jobstreet's online job posting business for RM1.73 billion. With that, Jobstreet will distribute RM1.7 billion in the form of dividends to shareholders. After the sale and distribution, Jobstreet will be left with the below.


The above could still be worth around RM0.32 to RM0.35 although the large part of Jobstreet has already been sold off.

Through my calculation, there are about 650.5 million (revised to 708 million) of outstanding shares inclusive of employees options, which some have yet to be exercised. At distribution of RM1.7 billion, that comes to about RM2.40 of dividend to be distributed to shareholders.

At its current traded price of RM2.54, the dividend distribution of RM2.40 and RM0.0175 (interim dividend) together with RM0.32 of net assets that's left, Jobstreet is trading at 7% discount - and don't forget, I am getting a huge chunk of cash - i.e. RM2.4175 per share in say within 6 months time upon completion of the sale.

7% discount in 6 months comes to about 14% return annualised - which is decent, and I do not know why investors are selling.

Although I am sad that Jobstreet is selling its main business, this is still one last opportunity to make some decent return. Hence, I just bought a small sum of 4200 units.


17 comments:

Jun said...

Hi Felicity,

Correct if I'm wrong, I think there's an error in your calculation. They issued shares to buy the Vietnam, Indonesia and Philipines operations so the total no. of shares should be 708 million instead of the figure you used.

http://announcements.bursamalaysia.com/EDMS/edmsweb.nsf/all/8079279EDB04C4D548257C84003756D6/$File/JobStreet%20Disposals%20(02%2019%2014).pdf

Fung C.F. said...

Yes I agree with Jun's comment. Based on 708m shares (as stated in section 6.2 of the announcement), the special dividend should be just RM2.40.

However, I noticed that Jobstreet owns some significant stakes in two listed companies i.e. 23.54% of 104 Corp (listed in Taiwan) and 21.13% of Innity, which both total up about RM100m market cap as of today's price. Adding up everything else, the value should be around RM0.27.

I too added some JOBST into my portfolio.

felicity said...

Thanks.

Jun said...

Regardless, I too bought @ 2.54.

felicity said...

This is what happened when you have a blog and people contributes :)

Big Sea said...

Felicity,

For the special dividend of RM 2.4, is it tax exempted ?

felicity said...

Ya single tier dividend

Big Sea said...

Then I join you guys tomorrow !

Phuah SK said...

Hi Felicity,

If special dividend payout is that good, why are investors selling? Is it because JOBST will enter into PN16 & PN17 listing after disposal?

Bn911 said...
This comment has been removed by the author.
felicity said...

Quite possible, yes PN17 is an issue to investors

Phuah SK said...

So you guys are buying based on the sound management of the company and believe that even in PN17, the company can make most of their remaining business?

I have yet to review their latest financial report, so I'll have a look before deciding if I should jump in as well.

LuPorTi said...
This comment has been removed by the author.
nixiao100 said...

Why not milk HDBS? RM 3.90 for RM 5.++. RM 2.50 per share payout in a few months time. That means buying liquid assets >RM 2.50 at merely RM 1.40.

Fung C.F. said...

nixiao100, it is more difficult to determine HDBS's fair leftover value. Not all remaining assets are in liquid form (only RM0.98). There are still some other stuffs like money lending business (which is an awfully great business) and properties. Though, buying them for RM0.42 per share looks quite cheap, but we have no hard figure for now.

The upcoming financial results (especially balance sheet) will give a clearer indication.

Just my 2 cents.

LIM FOO Yee said...

Hi Felicity,

Would you consider to sell off Parkson in view of weaker than expected latest quarterly result?

felicity said...

On Parkson, I would still hold on to it. The business is being challenged currently as There seems to be stronger competition and China does face dwindling sales especially for luxury goods - in which case is Parkson's market.

On Jobst, it seems that it is dropping further, which is good.