Originally Posted by
BlackPeter
Actually - 4 traders updated their numbers in reaction to the AGM. New target price is now $1.39;
However - even if I take the reduced EPS predictions assuming
10.5 cents for 2018 (my take based on them not improving on 2017 - 4 traders assumes still 11.5 cents), 12.1 cent for 2019 and 12.6 cents for 2020
than forward PE at current SP is 9.9 (well, say 10) and the EPS CAGR since 2012 (where EPS was 4.7 cents) would be 13%.
Putting this into beagles modified Graham's formula, (EPS * 10+g) then I still end up with a value of $2.41 per share ... and if I use the original Graham (8.5+2g), than it would be even $3.62 per share.
Obviously - if all the growth stops immediately (something neither the company nor 4-traders assume, and unlikely in a growing building market), than the share would be currently fair priced (well, PE 10 is actually not too bad on the uptrend of the growth curve).
I can only assume that there is still either something horrible lingering undisclosed in the dark ... or the market grossly overreacted. I assume the latter, but time will tell.
BTW - good news for downgrade counters ... this one was number 3 - i.e. all up from here :t_up:
Ah yes ... and the new expected peak for the NZ building market is now forecasted for not earlier than 2020 (according to some RNZ report I heard today) ...