CMV - Bargain A Sims Grp in Making...

[robbo]

CMA Group..-- CMV -

--Another Sims Group in the Making...?--

Good morning gals & guys

Yep .... CMA Corporation--ASX code: CMV... is the one imo right now...that has an easy 50-70% .... gains in 4-6 weeks from about now.

And ...***-- imo do not play with trying to "time the depth" and/or entry price....ie: imo only---- this is Margin of Safety --safe --up to 55 -57 ce. cents for entry into CMA..and 1- 2 months will give you easy 50%...imo ...

...Guys, I have highlighted or asterixed *** @**** ....etc etc the important points from their last Announcement from 2nd Feb 2007-- (2/2/07)-- was what .... caught my eye.....and still does.... catch my attention....

--CMA ANNOUNCEMENT – (ASX code: CMV).

CMA Reports Stronger First Half Result (ASX: CMV).

CMA Corporation Limited (ASX: CMV) today released its interim financial report for FY07.

In the six months to 31 December 2006, CMA posted an after tax net profit of $2.88 million on revenue of $104.0 million.

These results compare with an after tax net profit of $0.27 million and revenue of $37.3 million for the previous corresponding period.

Group EBITDA for the first half of FY07 was---*** $8.2 million, a substantial improvement on EBITDA of $2.05 million in the first half of FY06. @@ Note the **Big Tax Bill.... Guys , -this will come down due to the acquisitions and purchase of the headers. !! -

So Guys ,; if they (CMV)-- can get the Ebita based Full Tax down and repeat moderately the same success for the Full Year-- and keep up Npat Profits growth--...

Also Guys do imo , note this-

Basic earnings per share were 2 cents eps, so folks, , note this-->>-- *** **-- from 0.2 cents per share in the previous corresponding period.

CMA Managing Director Peter Hatfull said the first half result represented a significant rebound after a disappointing FY06.

Guys, note this-->>-- *** **“We are very pleased with the strong increase in revenue and the rebound in profitability,” said Mr Hatfull.

“These results reflect solid growth across the Group and a particularly good performance from our metal trading division.


Positive Immediate Outlook-- “We are currently enjoying buoyant conditions in the metal trading market and.....then....

.....Guys, do also imo note this-->>-- *** **.. we expect the strong demand for metal from our domestic and overseas customers to continue.”

“Trading conditions remain variable for our contracting division and our strategy moving forward is to focus on projects that support our metal trading business.”


And I personally like this-->>-- *** **Mr Hatfull said >>-- remediation was becoming an increasingly important business activity for CMA and that he expected contract work in this area to add real value to the Group in the second half.


So fellow S/Traders; , recall that ---****---- During the period CMA announced the expansion of its metal processing and contracting capability through the acquisition of the T & T Metal & ...Asbestos ... Services Queensland business and the J&M Metals business in Port Hedland, Western Australia...... (That is getting rid of Asbestos by the way !).....

The Group took further steps towards building its national infrastructure through the purchase...and folks also ---imo-- note this-->>-- *** **of three baler shears metal processing units *** providing the ability to .....significantly enhance the value of ....metal..... processed at its collection yards.

Mr Hatfull said the recent purchases have enabled the Group to establish.... And I like this bit.-->>-- *** **.. A strong platform for growth.

Cont’d./Page 2

This week, CMA announced that it had entered into a conditional Share Sale Agreement to acquire Southern Rocycling, the Victorian-based national scrap metal group. ...

CMA has commenced due diligence on the acquisition, which is also subject to shareholder approval and funding arrangements.

[ohmyme]

Interesting pick Robbo. On the surface this looks like an absolute bargain, especially based on the bullish commentary backed by massive increase in net profit and revenue results for the half year.

Based on some conservative calculations its not too difficult to build a case for CMV dropping $10million NPAT for the full year. Their trading division is experiencing strong growth, and accounted for 100% of the profit in the first half. So if they repeat that performance, we have $6million. If they squeeze profits from the contracting division and we add in some profits from the latest potential acquisition the numbers quickly compound.

Thanks for the heads up.

cheers.

[robbo]

quote:Originally posted by ohmyme

Interesting pick Robbo. On the surface this looks like an absolute bargain, especially based on the bullish commentary backed by massive increase in net profit and revenue results for the half year.

Based on some conservative calculations its not too difficult to build a case for CMV dropping $10million NPAT for the full year. Their trading division is experiencing strong growth, and accounted for 100% of the profit in the first half. So if they repeat that performance, we have $6million. If they squeeze profits from the contracting division and we add in some profits from the latest potential acquisition the numbers quickly compound.

Thanks for the heads up.

cheers.
.
--------------------------------------------------------------------

CMV Corporation.

Hi ohyme,

(CMV)....Yeah a very impressive analysis & short summary you make ehre on CMV-- ohyme.....

....Ohyme; CMV is a real "lay back on the hammock and snaffle 70 % + Gains-- "-- with no downside-- in a short time ----sort of stuff.

ON a PE of only 14-- that $10m-- would put 130% extra- Over & Above-- on the Current CMV-- share price by August....

Trying to do a ring around now--to see when the next catalyst/positive possible developments or news coming up for CMV -- and will come back before the close if I find anything...

They certainly have a stack of stuff now that is earnings accretive.

This (CMV) has a slight ring of a hybrid between Austin Engineering(ANG) and Boom Logistics(BOL) days about it ohyme...

-btw--did you get any Austin Engineering-- ANG when I flagged it at 38-39 cents before (mid last year) ) ohyme....?

Kindest Regards,

Robbo :)

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[corky]

Also picked by my favourite writer Trevor Hoey in the AFR on Weds as a small cap/big yield stock. He has it on a 2008 P/E of 7 (2007 P/E 10) and a div yield of 7%. Cites contribution from recent acquisitions and management desire to undertake more site remediation work.

Holding some
Corky

[robbo]

CMA Corporation.... ASX Code: CMV....

HI Corky,

Good research and spotting --vis a vis ---the AFR Corky....

Like you Corky; I too, like the AFR's Trevor Hoey's various Stock Pick press Coverages; and his thorough & balanced analyzes.

Hoey is quite succinct and insightful..... wish their were more AFR writers of his caliber.

Yep, I really like CMV-- "pound for pound"-- especially, as benchmarked against CMV's own Industry Sector Peers--,...

And the relative Intrinsic Value/Margin of Safety Combination-- in CMV ---to be had now-- rated highly alongside the immediate tangible high probability of current time High Growth Prospects; ..yep--agree with you Corky and I do Rate CMV Highly at present share prices-- ...Easy 70% stock price gains imo-- here over maybe next 2 months, but at the most, 3-4 months max.... imo.

Kindest Regards,

Robbo :)

[robbo]

CMA Corporation-- CMV-- Forecast CMV Earnings increase of 220%

*** Just got this (re. CMV)-- brought to my attention; at the PUB-- [/quote]

Aspect Huntley Research Analyst-- says CMV due for pending 220% Earnings Increase...--for this period pending, June 30...2007

According to:-- independent ASPECT - Huntley's Research--which admittedly is just one Broker's Research Analyst ..... says CMV's forecast for increased .... Earnings Growth ... for next Current Period (2007) will come in.... at 4.00 cps (cents per share)--..which they state; is a 220% Earnngs increase year on year.

Kind Regards,

Robbo

--------------------------------------------------------------

at [quote]quote:Originally posted by davidrob

CMA Corporation.... ASX Code: CMV....

HI Corky,

Good research and spotting --vis a vis ---the AFR Corky....

Like you Corky; I too, like the AFR's Trevor Hoey's various Stock Pick press Coverages; and his thorough & balanced analyzes.

Hoey is quite succinct and insightful..... wish their were more AFR writers of his caliber.

Yep, I really like CMV-- "pound for pound"-- especially, as benchmarked against CMV's own Industry Sector Peers--,...

And the relative Intrinsic Value/Margin of Safety Combination-- in CMV ---to be had now-- rated highly alongside the immediate tangible high probability of current time High Growth Prospects; ..yep--agree with you Corky and I do Rate CMV Highly at present share prices-- ...Easy 70% stock price gains imo-- here over maybe next 2 months, but at the most, 3-4 months max.... imo.

Kindest Regards,

Robbo :)

[mamos]

Have done a some research on CMV.

Comparison with Sims Group.

Sims is on a PE of 12 based on its HY07 results and CMV is at 11.6.
This suggests that CMV is fairly valued. However, perhaps CMV deserves a higher PE ratio given its greater growth prospects, both organic and from acquisitions, than Sims.

Does anyone know when and from what date the earnings from new acquisition T & T Metal & Asbestos Services (Queensland) business, J&M Metals business in Port Hedland, Western Australia and Southern Recycling will be represented in the a/cs?

Once the contracting business can start contributing to earnings we will see further earnings gorwth. It seems the problem is under-estimating the costs and difficulty involved in the projects it undertakes.

What are the other industry peers that a comparative analysis could be performed on.

Cheers

Mark

[robbo]

CMA Corp-- CMV...

ahaha,,, mamos,

You are trying to wind me up... I know........ anything you
say mamos !!

cmv has a totally different profile to sims metal-- for a start the return on equity and earnings growth is in three and nearly four figures for cmv-- ...

But I know you know that--and are trying to dampen the deal before you enter--CMV----ehhhhhh Mamos....you are a naughty naughty boy mamos...!!

Cheers,

robbo:)

[mamos]

Hi Robbo

Sorry Robbo don't mean to put a dampner on the thread.

I agree that CMV deserves to be on a higher PE than Sims, however as long as management can perform as they have this HY and improve this by integrating the acquisitions into their business model a re-retaing will be due.

By my calc I have a full year ROE (assuming same results as HY) of 12% for CMV and 19% for Sims. The return on Market Cap is 8% for both.

Disc. Do not hold at the moment. Looking to enter after more DD is completed.

Cheers

Mark

[robbo]

CMV.

Hi Mark,
Excellent to see you do Due Diligence...that is definitely one of your true strengths Mark...always impressed by your prudence & dd....[^]

Good balanced post mark

regards,

robbo:)

[mamos]

I think that question depends on the amounts of the rights issue?

Im guessing about a 1:3 rights issue.

This is based on sales of MC / Sales ratio of 0.3:1 for Southern Rocycling. CMV is on about .33:1 but considering this is earnings accretive I have used 0.3 for Southren Rocycling. This gives a value of $22.5m for the acquisition requiring approx 70m shares to be issued at 32c. As approx 210 m shares are on issue for CMV already this amounts to a 1:3 issue.

Yes there could be some downward pressure on price, but I guess this will be short lived. Market will also want to see earnings potential of the acquisition rather than just sales to determine how earnings accretive it is. If it heavily earings accretive then no downward move may be justified.

Cheers

Mark


quote:Originally posted by absolut-advance

Hi Mamos , Robbo , Corky, Ohmyme and other holders and watchers....

What are your thoughts on the rights Issue? Will this put a dampener on the price in the short term...

Would It be wise to hold off until rights Issue is finalized... completed? to rule out any suprises.... especially for those without cash to partake in the issue and therefore would suffer dilution of holding.....


thoughts appreciated


AA

[Huang Chung]

I am assuming that anyone buying in now will be elegible to subscribe to the the rights issue [?][?]

[Flying Goat]

Hmmm, director buy for > 500,000 shares off-market toda, thats got my attention...

[Huang Chung]

FG

Are we able to draw any conclusions from an OFF market trade [?]

Couldn't this possibly be just some sort of related party / entity transfer [?][?]....

[exposed]

yes Huang Chung maybe you can ring the company and ask about rights issue.
My understanding is generally the price falls when a rights issue is announced.
So would be pretty cool if you can sell at 50c and buy rights at 32c if record date was set at january.
Looks like a big seller is lurking around 50c as well.

[Flying Goat]

quote:Originally posted by Huang Chung

FG

Are we able to draw any conclusions from an OFF market trade [?]

Couldn't this possibly be just some sort of related party / entity transfer [?][?]....



If you read the announcement see the director is adding to existing entity that already has large holding, thus my conclusion is that director is adding to position, not just switching from one entity. Anyhow just an observation, i tend to look out for director buys as its one of the first things that interest me in a stock.

In saying that haven't got time to look at this stock further and doesn't strike me as anything special given the low margins they have been achieving, but perhaps that will improve over next few periods.

[ONTHENOSE]

Hi guys..

Thanks for the Heads up Robbo.... Had a look over CMV and dont mind what i see... Picked up a few last week.... See how she goes....[8D]

As far as i can see there is a great demand for Scrap Metals from the chinese...[:p]


This is an article from last week in regards to Sims Group (SGM), which i beleive has some relevance to CMV:

-------------------------------------------------
JAPANESE trader Mitsui & Co says it will become the largest shareholder in Australian metal recycler Sims Group by acquiring a 19.9 per cent equity stake as early as May from a U.S. company.

It said it would buy the stake for about $A602 million from New York recycler Hugo Neu Corp, the current major shareholder in Sims.
Mitsui sells scrap metal to Chinese steelmakers and said it wants to enhance its strength to procure more scrap metal.

Asian demand for scrap metal is buoyant because of strong economic growth in China and elsewhere.

Mitsui said it would send two officials as directors to Sims, which operates at more than 120 sites worldwide.

Sydney-based Sims mainly offers recycled metal products to European and U.S. electric furnace makers

----------------------------------------------



Could we see a takeover in the future[?] or is it only early days[?]




Regards

Mike

[Huang Chung]

The recently announced (potential) acquisitions of Southern Rocycling and Mann Metals look interesting. Both are expected to be earnings accretive in the first full year.

The way CMV now seem to be gobbling up smaller privately held businesses is making this stock look a bit like a mini Transpacific. The main industry focus of these two companies isn't really that dissimilar when you think about it either, being waste (TPI) and scrap (CMV).

Robbo - Are you still following this one [?]

[robbo]

cmv.

Up a nice 5.3 % today--to defy overall downish fickly daily market sentiment.

Regards,

Robbo :)

[ONTHENOSE]

Hi Guys,


Have i missed something[?] Down 26.96%[:0]

[mamos]

Gone ex-entitlement 3 for 4 rights issue at 32c.


quote:Originally posted by ONTHENOSE

Hi Guys,


Have i missed something[?] Down 26.96%[:0]

[BSA]

So with the adjustment factor applied to previous price(57.5c) it makes that 46.5c so currently only a 5.5% drop.

Cheers

[_Michael]

Hmmm. Anybody still following this stock? Would you believe that only yesterday I picked up my first parcel in CMV on the basis of pleasing full year result and very bullish outlook from management based partly on significant contributions for FY2008 from recent acquisitions as well as strong organic growth and improved margins from have exposure to the whole supply chain. Just logged in this afternoon to see the price has jumped almost 20% on hefty volume, lucky timing (for a change!) any ideas as to what might be up? Perhaps it is just approaching the size at which funds are starting to pay attention.

[steve fleming]

haven't really followed the CMV story, but see that they went into voluntary administration yesterday, after they failed to meet a $2m interest payment.

[Stranger_Danger]

I've had this on my watchlist forever but never bought. Should have been a decent business, but too much debt.