So - how does this work? If we take for arguments sake the 50m NPAT you are using as "optimistic scenario" (which is by the way ways below analysts forecast of $71m, but so be it), than we have 16 cts earnings per share (given that NZR issued 312.6m shares).
PE is obviously SP / EPS
This amounts in my books (at a SP of 250) to a PE of 15.6, not of 17 as you state.
If we take your horror scenario of only 30m NPAT, than PE would be at 26 (not 31).
Just help me to understand ... what formula do you use to calculate PE - or did you add some more shares into the mix?
that's why I say rough shares on issue was off the top of head anyway still looks bad
off there profit matrix and few off my assumptions
fair enough ... so I suppose this is assuming GRM drops back from their current levels and NZD stays high ...?
I guess I didn't manage yet to reliably predict oil and currency market (and I don't know anybody else who did), so yes, might happen.
Personally I think it would be more likely for NZD to drop again (hey, the reserve bank must be good for something) and GRM to keep going up (due to increased demand for refined oil products in the second half), but as indicated - my crystal ball is cloudy ...
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"Prediction is very difficult, especially about the future" (Niels Bohr)
NZR is incredibly hard to value so we may only know in 3-4 years whether $2.50 at todays date was cheap or expensive. Based on the chart and even todays action, why would you buy now? It certainly looks like its going lower. We haven't seen a capitulation yet, the fall has been very orderly. We may eventually see a price with a $1 in it and even then, it may not be an obvious buy.
This might well explain the drop today. Do you know the reason for the downgrading? I guess so far things appear to go quite well for NZR the last couple of months or so ...
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"Prediction is very difficult, especially about the future" (Niels Bohr)
Originally Posted by BlackPeter
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