PGW - PGG Wrightson

[GR8DAY]

......yes what is the current yield at 53c....anyone know or prepared to forecast that over the next 12mnths.??

[Snoopy]

At 64c PGW is now trading on a projected PE for FY2010 of 64/3.1= 20.6. Hardly cheap although the capital restructuring will shave that interest bill in future years. And if you believe the old Craig Norgate vision of $40m (which translates to $55m, or 7.2cps under the new capital structure) then PGW is trading on a FY2011 PE of 64/7.2 = 8.9.

Just repeating part of a post I made on 13th January, for those with memories towards the shorter end of the spectrum. At 53c, PGW is trading on a 'good season' PE of around 7. The dividend has currently been suspended while earnings go to pay down debt. So the projected dividend yield is currently nil. If you swallow the Norgate hype then the the best case scenario would be an annual dividend of 7cps.

It is quite difficult to value a share like this based on cyclical earnings. The question is, is the Craig Norgate vision still attainable? I would say it is. But whether that vision comes to fruition in FY2011 is another matter.

SNOOPY

[GR8DAY]

....so tell me SNOOPY, what exactly is/was the Norgate Vision??

[percy]

[

It is quite difficult to value a share like this based on cyclical earnings. The question is, is the Craig Norgate vision still attainable? I would say it is. But whether that vision comes to fruition in FY2011 is another matter.

SNOOPY[/QUOTE]

As allways snoopy you do the hard work.Craigs have FY 11 net profit at $44.4 mil rising to $49.20 FY 12.So they are a bit behind Norgate's $55mil,but as you correctly point out cyclical earnings make a correct valuation hard.Who knows Norgate may be right!! What is important is the company has been put right.

[root]

If you are holding PGW at the moment it is because you are expecting the SP to move North rather than projected Yield. Good value at 53.

[Snow Leopard]

I've picked up my first ever PGW parcel today @ .53

I do not know whether to congratulate you or commiserate with you.
I hope it works out

regards
Paper Tiger

[Snoopy]

....so tell me SNOOPY, what exactly is/was the Norgate Vision??

No major climatic effects during the farm year. Reduced costs because of rationalisation of the previous separate Pyne Gould Guiness and Wrightson store networks. Interest rates not significantly changed.

SNOOPY

P.S. No contribution from the failed Silver Fern Farms tie up has been allowed for.

[Snoopy]

If you are holding PGW at the moment it is because you are expecting the SP to move North rather than projected Yield. Good value at 53.

I would argue it is the same thing. The share price will move north when dividend prospects improve.

SNOOPY

[root]

I would argue it is the same thing. The share price will move north when dividend prospects improve.

SNOOPY

The market seems to factor in good news before it's announced.

[GR8DAY]

no major climatic effects during the farm year. Reduced costs because of rationalisation of the previous separate pyne gould guiness and wrightson store networks. Interest rates not significantly changed.

Snoopy

p.s. No contribution from the failed silver fern farms tie up has been allowed for.

sounds more like a dream than vision snoops!! No climatic effects ha!......i think he needs to go get a real job and try farming.......might looses a bit of that gut in the process!