Skellerup (SKL) Fundamentals

[Lizard]

Thanks Catalyst.

I have fair value at $1.15 for now, but I'll happily hold above that while it seems likely that profits will continue trending in the right direction. My best guess would be for about $1.50 in a years time, so, on that basis, it's still a "buy the dips" story.

[Catalyst]

Yip Liz, still a solid Hold in my view.

[rabcat]

Yip Liz, still a solid Hold in my view.

SKL come back into the NZX 50 index on monday ( at the expense of Pike River Coal).

This mean the fund managers will have to buy? And this will tend to push the price even higher?

[Catalyst]

My valuation range is between $1.10 - $1.20 if I now use the midpoint of the company's current guidance ($18.5m - $19.5m). I wouldn't be surprised to see the company exceed this range, like last year, though.

Forecast NPAT = $19.0m midpoint
Forecast EBITDA = $36.8m (NPAT + $8.2m tax + $2.3m int + $7.3m dep'n/amort'n)

PE of 12.0x = 12.0 x ($19.0m/191.1m shares) = $1.18
EV/EBITDA of 6.5x = (6.5 x $36.8m - $26.6m net debt) / 191.1m = $1.10

If I assume NPAT will be $20.0m, my valuation range is $1.15 - $1.25, using the same PE (12.0x) and EV/EBITDA (6.5x) multiples above. It could be argued that if the company is in a period of good growth prospects then the multiples could be increased. If I assume $20.0m NPAT and use a PE of 13.0x and an EV/EBITDA multiple of 7.5x, both multiple-based valuations then come to $1.35.

Couldn't find anything to fault in the solid 1H 2011 result announced today. I'm still forecasting FY NPAT of $20m (compared to the company's reiterated guidance of $18.5m - $19.5m).

My valuation range is currently $1.35 - $1.44 based on:
PE of 13.0x = 13.0 x ($20.0m/192.8m shares) = $1.35
EV/EBITDA of 7.0x = (7.0 x $42.6m - $20.0m net debt) / 192.8m = $1.44

[percy]

Couldn't find anything to fault in the solid 1H 2011 result announced today. I'm still forecasting FY NPAT of $20m (compared to the company's reiterated guidance of $18.5m - $19.5m).

My valuation range is currently $1.35 - $1.44 based on:
PE of 13.0x = 13.0 x ($20.0m/192.8m shares) = $1.35
EV/EBITDA of 7.0x = (7.0 x $42.6m - $20.0m net debt) / 192.8m = $1.44

Thank you for the update.I agree with your forecast.very positive outlook.

[waterboy]

Anyone know how the plant in chch is? Last quake skl made an announcement soon after.

[gonzo56]

Dompost:
"...staff at three locations came through without serious injury. It would not be clear when work would resume, but the company said established inventory and supply lines would ensure that it continued to meet customer demand"

[JemT]

Does anyone know of any competitors to SKL? I am struggling to find some at the moment, with the exception of a few large multinationals (DuPont has a rubber products line, etc.).

[forest]

Does anyone know of any competitors to SKL? I am struggling to find some at the moment, with the exception of a few large multinationals (DuPont has a rubber products line, etc.).

ASB gives as SKL peers Austal Ltd, John Shearer and ADG Global Supply, I do not know how relevant they are to SKL but it might be worth looking into.

[Catalyst]

SKL seems to have stalled at around $1.30. I wouldn't be surprised to see it hang around this level for a further few months until it announces its FY11 result in mid-August.

Based on the company's $18.5 - $19.5m NPAT guidance, SKL is currently trading on...

PE = $1.30 / (($18.5 and $19.5m) / 192.8m shares) = 12.9x - 13.6x

EV/EBITDA = (($1.30 x 192.8m shares) + $20.0m net debt) / ($40.2m and $41.7m) = 7.2x - 7.5x