Interesting Percy, wonder what that might be signaling about the uptake? Quite a standoff on the market so far.
I rang my broker this morning to place two orders,one at $3.08 and one at $3.05.That was when he told me we had received allocations.I then decided not to place any buy orders,and hold off to see what the market did,keeping in mind we can apply for the SPP.
So was a liitle surprised ,and pleased, to see three buyers, each wanting 5,000 shares at $3.18,$3.17 and $3.16.
No. Shares on issue EOFY2017 74,523,527 No. Shares Sept 2017 Placement $25m / $3.02 = 8,278,146 No. Shares Sept 2017 SPP $5m / $3.02 = 1,655,629 Post capital raising total No. Shares 84,457,302 {A}
Guidance for FY2018 is for NPBT of $29m - $31m
Guidance for FY2018 is for NPAT is NPBT x 0.72 = $20.9m - $22.2m {B}
Forecast 'eps' based on the number of shares at the end of the financial year is therefore {B}/{A} which translates to a range of:
24.7c to 26.3c per share
I know this doesn't take into account the 'weighted average number of shares' that Beagle asked for, but I have my reasons for not doing so.
The equivalent figure for FY2017 was:
$17.609m / 74,523,527 = 23.6cps
Using the end of year share measure, the projected NPAT 'eps' gain for FY2018 is: 4.7% to 11.4%. If we use Percy's yardstick of 'fair value' being when the PE reflects the growth, this means the 'fair value' projected share price for FY2018 is between:
4.7 x 23.6 = $1.11 (minimum)
11.4 x 23.6 = $2.69 (maximum)
I am not feeling much excitement looking at share price target figures like that.
{Further adjustment from (my post 1478) to come.}
SNOOPY
I ran the snout test over that depth. Three equal bids one cent apart. My nose to detect creative market making tells me that's a contrived bid by one interested party, possibly the underwriter ? My gut instincts tell me there's more juice in the new car market right at the minute with interest free or super low interest deals on no deposit on new highly fuel efficient vehicles with cutting edge technology...acknowledge my sense could be affected by our own buying tendencies but holding CMO to cover both bases :)
LOL indeed. Forced me to do my own quick EPS growth calculation forgetting about all this nonsense weighted average capital basis (because they issue shares so regularly its hard to keep up).
Last year $17.6m on 74.75m shares gives 23.5 cps.
This year $30m before tax gives $21.6m after tax on 84.4m shares = 25.6 cps. EPS growth keeping it simple at the mid point of forecast, (and assuming there isn't yet another placement before FY18 year end) is thus 8.9%. At $3.20 it trades on a prospective PE of 12.5....higher than CMO's PE. Hmmmm that's pretty interesting especially with the latter having a very well established long history of profit growth. The apparent bargain some might imagine...I beg to differ, its actually higher than many other car companies globally and in N.Z. Check Ford's PE listed on the U.S. market as one example and there are many others. Lets not forget that in many respects car sales are cyclical, they do well when the economy is doing well, interest rates are very low and funding to credit worthy customers is readily available and they do not do well in tough economic recessions or during a GFC.
At $3.02 it trades on 11.8 times forecasted FY18 earnings...looks more like fair value to me although still not a bargain by any means for a company with fairly strong cyclical characteristics. I will probably give the SPP plan a miss and buy more of SUM thing else.
Ford's ute selling like hot cakes. New 10 speed auto V8 Mustang coming will also be an exceptionally hot ticket item. (I have this earmarked as a possible acquisition for my own use). They have finally ditched their problematic DSG gearbox equipped Focus and are fitting them with proper convectional auto gearbox's.
Ford are behind with electrification but that's not the be all and end all as I've alluded to at some length in the electric car thread.
Mazda's new high tech petrol engine coming with all the benefits of a petrol and diesel engine looks interesting. I'm expecting very strong sales of Mazda vehicles.
Sound very well and conservatively managed company with a very very long track record of consistent growth.
Have had to discount my DFC valuation by 9% to allow for more shares ...now less than $3
Had another look at my numbers on CMO which at $7.70 is trading cum a 31 cent fully imputed divvy. At a theoretical ex divvy price on $$7.39 it is trading on a historical PE of 10.8. No formal forecast for FY18 has been issued but my expectations are for steady growth and I have them on a forward PE of just 10 with their long and highly credible track record of consistent growth compared to Turners with their much shorter history of growth on a forward PE of 12.5 at $3.20. Hmmmm..you guys can have my ones at $3.02. I will hold the bonds to their maturity next year and decide in due course whether to convert them of ask for the cash back.