- Published on
First Week of July 2024
- Authors
- Name
- Sean
Warning
You probably know that I don't make stock recommendations, it is solely a record of my personal investment. Any action or opinion in the article may not be correct. Any investment targets mentioned in the article carry the risk of significant short-term declines. Please think independently and rationally!
Csah Dividends
| Exchange | Symbol | Date | Amount |
|---|---|---|---|
| HKEX | 00700 | 2024/05/31 | 647.00 HKD |
Latest Stock Portfolio
| Exchange | Symbol | Ratio | reasonable valuation1 | Mkt Cap1 | Stock Price | Stock Price Increase This Year |
|---|---|---|---|---|---|---|
| HKEX2 | 00700 | 82% | <3,200 | 3,540 | 379.80 | 30.88% |
| NYSE3 | BABA | 13% | <180 | 177 | 74.52 | -1.77% |
| --- | Current Assets | 5% |
Annual Change Rates
| Year | Net Asset Value | Portfolio4 | S&P 500 | Hang Seng |
|---|---|---|---|---|
| 2023 | 0.93 | -10.95% | 24.23% | -13.82% |
| 2024 | 1.18 | 27.93% | 16.72% | 4.41% |
Important Matters
1.Tencent Dividend
On May 31st, a cash dividend of HK $680 was received from Tencent, with an actual amount of HK $647 received after deducting related fees.
1.Tencent Repurchased HK $52.3 billion in the first half, more than the whole of last year
As of June 28th in the first half of this year, Tencent has cumulatively repurchased 56 times, totaling HK $52.3 billion ($6.7 billion), of which the first quarter saw a repurchase amount of HK $14.8 billion ($1.9 billion), and the second quarter saw HK $37.5 billion ($4.8 billion). This repurchase scale has exceeded the full-year 2023 amount of HK $49.4 billion ($6.3 billion). The repurchase amount of Tencent in recent years is as follows:
In terms of repurchase, Tencent is undoubtedly a model for Chinese listed companies. Tencent is the company with the largest repurchase amount in the Hong Kong stock market in the first half of the year, accounting for more than 40% of the total repurchase amount of the Hong Kong stock market during the same period.
In the second quarter, Tencent operated on every repurchase day, with a total of 38 times, with an average repurchase amount of HK $986 million ($126 million) per day, and a total of 103,690,000 shares repurchased. In the first half of the year, a total of 154,730,000 shares were repurchased. In comparison, Tencent repurchased a total of 152 million shares in 2023, and the repurchase volume in half a year exceeded the total for the whole year last year.
Tencent plans to repurchase more than HK $100 billion this year, and together with dividends, it will contribute more than HK $130 billion in returns to investors, which corresponds to the current market value, with a dividend yield of about 3.7%.
According to the regulations of the Hong Kong Stock Exchange, the repurchased shares are all used for cancellation. This year, Tencent's repurchased shares are also being cancelled in succession. As of June 28, the total share capital of Tencent was 9.3546 billion shares, compared with the total share capital of Tencent at the end of 2023 was 9.48 billion shares, which is equivalent to a 1.34% increase in the value per share. The changes in Tencent's total share capital over the years are as follows:
From the highest point of 9.622 billion shares in the second quarter of 2022 to the end of the second quarter of this year, it has decreased by 267 million shares, about 2.77%. Compared with the same period last year, it also reduced by 240 million shares. At present, Tencent's repurchase efforts have far exceeded the sales volume of the major shareholder Prosus in the same period. The total repurchase amount of HK $37.5 billion ($4.8 billion) in the second quarter is more than twice that of the first quarter and 2.7 times the total sales amount of the major shareholder Prosus ($1.76 billion) in the same period. The gap in scale with the major shareholder Prosus's share sales continues to widen significantly, as shown below:
The major shareholder Prosus's funds for repurchasing its own shares are all obtained by selling Tencent shares, so we can directly regard its repurchase amount as the amount of selling Tencent shares.
Investment is an investment in excellent companies, and the money earned by investors includes two parts:
- The growth of net profit, that is, actually making money.
- The company repurchases at a reasonable valuation, as well as the income from dividends.
Even if the net profit growth rate is not high, stable dividends and repurchases can also bring continuous returns.
2.Alibaba Spent $5.8 Billion on Stock Repurchase from April to June
From April to June this year, Alibaba spent $5.8 billion on stock repurchase, which is the largest single-quarter repurchase scale since the company was established. In the first half of this year, Alibaba spent a total of $10.6 billion on repurchase, which is more than the whole year of 2023. The repurchase amount for six consecutive quarters is as follows:
It can be seen that the repurchase amount of the two quarters this year has already exceeded the repurchase amount of the whole year last year, and the repurchase is continuously increasing. As of June 30, the company's stock repurchase plan still has a balance of $26.1 billion, which is approximately 14.9% of Alibaba's current market value. This means that Alibaba will continue to repurchase shares. At the same time, as of June 30, there were 2.378 billion American Depositary Shares of Alibaba issued, corresponding to 19.024 billion ordinary shares. The changes in share capital for eight consecutive quarters are as follows:
As for the intention of Alibaba's stock repurchase? On the one hand, it can boost market confidence. Stock repurchase is usually seen as a manifestation of the company's management's confidence in the company's future development. By repurchasing shares, Alibaba is trying to convey a positive signal to the market, indicating that the company believes that the current stock price is undervalued and has the potential to rise in the future. On the other hand, it is also to maintain shareholder value. By repurchasing shares, Alibaba can effectively use the abundant cash flow to enhance shareholder value. This is especially important when the company lacks high-return investment opportunities.