CK Asset Holdings

Ticker: CHKGF, Buy below $15.

CK Asset Holdings is an real-estate and infrastructure assets focused holding company based in Hong Kong .

Why I Would Buy

  1. Low Earnings Multiple – CK Asset trades at < 7x earnings.
  2. Below Book – CK Assets is trading at 0.75 times tangible book value.   
  3.  Low Payout – The dividend payout ratio is at a very healthy 20%, although the yield itself is < 3%.
  4. High ROE – Return on Equity > 10% for past few years.
  5. Insider Buying – Li Ka Shing (the “superman”) purchased significant blocks of shares from the open market.

What Could Go Wrong

  1. Concentration – 80% of revenues are derived from real estate in Hong Kong and China, where there is a persistent talk of a bubble forming.
  2. Conglomerate – CK Assets is a weird conglomerate holding disparate assets such as real estate, airline leasing, home heating services and the like.

Disclosure: I am long CHKGF, please read additional disclosures here before taking any action based on this post.