Thursday, June 15, 2017

SUPER-RALLY STOCK: AN UPDATE

Moya Asia stock
Dear readers, this is an update about Moya Holdings Asia stock. As shared with readers, Moya Holdings Asia has been a star of a stock, rallying as a two-bagger from Apr 2017 to 7 June 2017 where it closed at $0.131 before the shares halted trading. During trading halt, Moya Holdings Asia announced the acquisition of a company called Acuatio with operations in Indonesia that is in the business of “is in the business of developing and operating water treatment facilities and associated distribution pipelines for the distribution of clean water.”

When Moya Holdings Asia resumed trading on 12 Jun 2017, its share price headed south by 5.3% followed by a small increment of 0.8% on 13 Jun 2017 and yesterday (14 Jun 2017), Moya Holdings Asia closed 3.2% down at $0.121. This means a “southing” of around 8% of share price since trading resumed.
So why did Moya Holdings Asia stock price head south following the announcement of an acquisition? There can be many varied reasons but I believe that the acquisition of Acuatico which though has recorded net profit before tax of approximately US$25.76 million for the financial year ended 31 December 2016 might not be welcome by investors as Acuatio has:

1) a deficit net book value of approximately US$25.78 million as at 31 December 2016, and

2) net tangible liabilities of approximately US$133.71 million as at 31 December 2016.

I have already divested my shares in Moya Holdings Asia at around $0.12 per share before trading halt and for the year to date, has earned much profits from this stock where I have selected it at low prices, predicted its price movement all the way to trading halt and even have it acquiring other companies correct. I am not impressed at Moya Holdings Asia buying a company with deficit net book value and net tangible liabilities. I think if Moya Holdings Asia stock continue to head south below the previous support of $0.115, then a downtrend of this stock is formed for this stock. Join the emailing list to receive regular Financial and Singapore stocks newsletters too! Like" me on Singapore Stocks Investing Facebook page to receive all posts on your Facebook as well as read more articles. Follow me on Twitter too.

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