Sad news to every kababayan, a lone gunman set portions of the casino on fire killing and hurting numerous employees and guests. This caused the stock to drop 7,94% last Friday, June 2, 2017. Because of this recent development, is RWM worth buying or not? Should you buy or avoid it as of the moment? Check out the video below and certain snippets about the company as well to help you make a sound decision should you buy the stock or not.
Before we go and dive into the company and the numbers. Don’t let news items like this rob your joy. Joy and peace should spring forth from the inside out. Things like this are sad but don’t let this ruin your lives, don’t let this remove your peace of mind. Don’t live in fear, live your life knowing that greater days are still ahead for you and your family.
Catch me in my live training events! (quick plug)
The heart of why I do this seminars is I want to build a generation of Filipinos with the right foundation in stock investing. I want to bring smart investing to every Filipino around the world! If you would like to know more on how you could time the market checkout the trainings below.
Stock Smarts Manila — June 10 – July 2, 2017
Stock Smarts UAE — July 6 – July 10, 2017
Stock Smarts Qatar — July 11 – July 16, 2017
Stock Smarts Iloilo — July 29 – July 30, 2017
Stock Smarts General Santos — August 25 – August 27, 2017
I have been consistent with my macroeconomic posts that I am pretty much bullish on construction, consumption, property and banking stocks. RWM does not fall into this sectors which has led me to tell you in the past to avoid gaming stocks specially if you are an investor.
Looking at it closer RWM’s income and EPS have been declining since 2014 and if you have attended my stock smarts training sessions, I would always place a big emphasis on buying companies with increasing income. Why would you want to buy a company who’s income is declining? Probably they are spending more or worse off they are losing out to their competitors. Which in this case, we saw 3 new and better casinos spring out in the past 3 years. ROE of the company is at 6, which is relatively lower than the benchmark that we placed in our Stock Smarts sessions.
Why am I saying this to you? If you are an investor, regardless if there was an incident or not in RWM, there is no fundamental reason to buy the stock.
MACD already gave a sell / avoid signal last May 17, 2017 which was more than 2 week before the big drop happened. While the 10 day moving average also gave a sell / avoid signal last May 29, 2017. This just shows that the regardless of the news item that happened the stock should have been avoided based on the technicals.
Now what needs to be watched out for is the 3 Peso support level. This is one of the lowest that RWM has hit through the years. If 3 is broken, the stock could be even more bearish and could drop even further.
To balance things out though, the stock is already oversold and should there be any knee jerk reaction that would cause the stock to move up it’s just because RWM is oversold. A bounce from 3.2 would bring the stock to a quick target price and sell at 3.4/3.45.
I hope this helps you analyze and study the stock further and I really do hope that the stock market helps you reach your goals of financial freedom. As I really hope that more and more Filipinos earn and use the stock market to their advantage! God bless you!