Freightways - FRE

[Catalyst]

OK result but FRE still carrying a fair amount of debt. Multiples look a bit on the high side IMO.

From today's FY11 result:

EBITDA = $66m
NPAT = $31m (excluding $1m in non-recurring earthquake costs)
Net debt = $154m
FY dividend = 14.5c
# shares = 153.6m
Current share price = $3.21

1. PE = $3.21 / ($31m/153.6m) = 16.0x

2. EV/EBITDA = (153.6m x $3.21 + $154m) / $66m = 9.8x

3. Gross dividend yield = 14.5c / 321 / 70% = 6.5% (75% payout ratio)

[voltage]

is mainfreight as better pick?

[percy]

is mainfreight as better pick?

I am a trustee of an estate which holds FRE,while one of the benificieries works at Mainfreight.We looked at selling FRE and buying Mainfreight,but decided to hang onto FRE as we felt a lot of future growth was built into MFT's shareprice.Should MFT not deliver the SP will suffer.FRE has a lot better yield and as they were purchased at float,the yield on purchase price is very good.With internet sales growing the prospects for FRE are sound.

[Lizard]

With internet sales growing the prospects for FRE are sound.

NZ Post dying because they have less mail because of the internet... FRE flying because they have more parcels because of the internet...

[percy]

NZ Post dying because they have less mail because of the internet... FRE flying because they have more parcels because of the internet...

Not so many people writing letters to each other is the real reason.I pay my accounts by internet so even less mail.
What I was really trying to say but didn't;, FRE deliver the things you buy on the internet,where as MFT handle larger freight.

[voltage]

thanks, sounds like owning both is a good idea

[percy]

thanks, sounds like owning both is a good idea

Yes ,that may be the right way to go.Both companies are very well managed.

[jmsnz]

I don't actually see that FRE and MFT are all that similar really - just go to their websites and read the about us pages they have quite different aims and aspirations. Yes, they both shift freight, but they do it in quite different ways and for different reasons. In MFT's case they have designs on being a global logistics operator - a lofty aim but they are certainly making steps in the right direction. In FRE's case they are about express freight in NZ.

I hold MFT and are considering FRE, I think both make sense for their own reasons.

[Snow Leopard]

And then down over 2% to $4.02.

I own this in the ShareTrader competition but not in real life.
However it is in my buy category at the moment (where Mainfreight is not)

best wishes
Paper Tiger

[Blendy]

Have i missed something here? From $4.20ish last week or so, down to $3.75.