Is this a good opportunity to get into Wilmar? I probably will have a hard time valuing it but for those investors who always thought Wilmar was too expensive, this is an opportunity.
But is this a foolish move? When a company diversify into another industry, most of the time it became worse.
This is a 3 years price chart. Support can be found at $5.30 to $5.10 region. What do you guys think?
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lion
Wednesday 5th of January 2011
Agree with Marti. When every Tom, Dick and Harry goes into property, it is time to get out. Commodities is a winner for Wilmar and they should stick with their core strength.
Drizzt
Wednesday 5th of January 2011
if you were them, and that commodities are such good business, why the need to diversify? would going into property earn them a higher margin?
Marti
Wednesday 5th of January 2011
Diversifying in real-estate seems to be a trend these days and I think it is a sign of a serious real-estate bubble.
To an investor this is not good as it makes assessing the company's situation more difficult, and the markets recognize this by usually valuing conglomerates and holdings less than the sum of their parts.
Drizzt
Wednesday 5th of January 2011
a contrarian will think other wise to suggest there are room to run. i feel there still are.