Fair enough. I am not working with an NPV model as you can see.
My table of numbers based on any particular year should not be regarded as a 'forward estimate'. All numbers are mechanically generated according to a formula that calculates a return based on retained assets based on every year being 'average'. They are mechanically calculated projections that ignore the market noise of any particular year. Of course if you pick on any particular year the real number is unlikely to be 'the average'. But real numbers, for a company with resilience, will have a tendency to fluctuate around an average trend.Quote:
BUT
with the company predicting FY2015 profit in line with $20M7 I disagree with those forward estimates
If Skellerup does not earn 13.4cps (underlying) in FY2015, this will cause earnings growth to be less than projected. Likewise further down the track if earnings are higher than projected, the table will start to catch up with itself. A poor year in FY2015 will only affect one data point out of ten when calculating ten year averages.
Your NPV model has generated a 28cps fall in value based on one down or flat year. The NPV model gives more weight to the immediate outlook than the long term trend. I choose not to do that, which is why my valuation is somewhat different from yours.Quote:
and starting with $0.11 NPAT for FY2015 reckon a truer NPV would be $1.285
SNOOPY