HK stock at 6x PE and negative EV

With possible hints of a special dividend coming

I have a new HK micro/small cap today. Buyable on IBKR. But rather poor liquidity of between USD$20-40k/day. It has a negative EV with an above average business attached to it and judging recent unusual volume spikes I think it is likely a special dividend could be paid soon. The last time a similar volume spike happened it was followed by a large special dividend months later.

First some updates. Nexpoint (NXDT) has seen more and more insider buying. And the “Big Beautiful Bill”, passed by Congress yesterday and now awaiting Trump’s signature, restores the FCC’s spectrum auction authority. I actually did not know they lost it in the first place. It does look like a spectrum sale will happen soon which will likely cause a pop in the stock (after which I will probably sell). Haven’t sold any shares so far though.

Closing Silicon Motion (SIMO) here at almost $75. I think stock has gotten a bit carried away here. Any increased tariff uncertainty and stock is back at $50-60.

Also closing Venture Life Group (VLG) at 60p. Shares are probably worth 70-80p but PE is a bit too high given the quality of the business. Making new acquisitions could take a while so cash has to be discounted, I think the stock will be stuck in this range for a while. Also don’t like that they are hiring external consultants to help with their acquisitions. Stock looks cheapish here, but there are better places to park my money.

Closing First Pacific (0142:HK) as well. Including dividends, the stock returned nearly 200%. It had a PE of just over 2x when recommended and a dividend yield of around 10%. Now PE is about 4x and dividend yield 5%. Still cheap, but given the fact that this is a South East Asian conglomerate controlled by a shady family with debt/EBITDA of 3.5x the situation looks nowhere near as juicy.