Forum Archive Index - July 2001

["Peter" <pmaiden@xtra.co.nz>]

Andrew - RNS has been one of my favourites over the years but is wiping my chances out in the Beat the Broker competition - down from 123 to 76 not too good.

 

RNS has done a fantastic job in turning themselves around over the last few years - and in the process becoming a very efficient distribution company. They did that by using technology to change the way they did business - and did it well.

 

Conduit was a result of that and good luck to RNS if they ever do successfully list in Singapore.

 

Leaving the value of Conduit out of the eqaution RNS did make about 4 cents a share profit last year. Some forecasts have earnings this year at around 7 cents a share. Recent revenue and earnings growth say that the forecasts are not that stretched.

 

That means that the PE of RNS is about 19 times trailing earnings and 11 times forecast earnings.

 

These PEs are too demanding and as such the RNS price appears cheap. The value that the market saw in Conduit listing in Singapore seems to have fallen out of the price. Another upside?

 

I don't have any RNS at the moment. After riding it up from 55 last year to over 130 I sold half of what I had at 90 in December - only to see it go back to 130 odd again. Talk about regret. The signals were to see out completely in Feb at about 115. This has been one instance when discipline has paid off - take the profits when you can, even though there was some regret when after selling at 90 and see them move back to 130.

 

The future - breaking through the support level at 85 wasn't good. The next support level is around 65.

 

I still like RNS and think that the future is good for them - even as a distribution company. However the many good posts over the past few weeks about when to buy and sell has only reinforced the need for discipline in making decisions to reign supreme.

 

As such seeing RNS is in a downtrend I would want to see a new uptrend to start before I get back in again.

 

Cheers

 

Peter

 

Dowm another 4 to 72 since I started writing this. Enough said