Okay...pauses for thought...yes, I will fire the first snooping question, seeing as the Snoop Dog is obviously asleep in his kennel.
How do they get EPS of 9 cps in their analysts presentation ? They must be using an average number of shares on issue during the year because based on the issued shares at year end of 463.266m and earnings of 36.0 after tax I get EPS of 7.77cps and based on a SP of 95 cents = a PE of 12.22.
Based on the mid point forecast for 2015 of $43.5m I get EPS of 9.39 cps for a 2015 PE of 10.12. Thoughts ?
The discount for those opting into the dividend reinvestment programme is reduced from 2.5% to 1.0%. Seems they don't particularly want more capital. Fair enough.
Earnings Per Share was $0.09 based on weighted average shares on issue.
Page 2 of NZX and Media Release
Thanks...so looking forward we're on a 2015 PE of 10.12 based on mid point of forecasted profit. In my view the current historical PE is spot on for a small bank and with forecasted earnings growth of 20% this year this leaves room for circa 20% SP appreciation over the year ahead as they continue to meet their target growth. Add in say 7 cps divvy fully imputed for the yeah ahead and you're looking at a circa gross 30% return for holders in the coming year
Eps calculated on weighted (time wise) average number of shares being 411million. Theory being those new shares were only generating income for a little while, not the whole year.
On the 463 million shares at year end it is 7.7 cents as Roger calculated.
Lets run with 9 cents calculation. As per Roger next year it's 9.3 cents EPS ......not much of in increase in EPS is it. Is the acquisition really EPS accretive in its first year?
That's why they need a share buy back ....increase the EPS (lower number of shares) and ROE (reduced equity) at the same time. Tricky eh.
(Just as well the divie is paid on all the 463 million shares eh, not just the weighted number)
I read this as either special dividend or buyback. I think they should suspend the Divi Reinvestment plan. Any other ideas?
Not sure what to expect? Some form of buyback I think would have the most affect on ROE.
As for suspending the divie reinvestment plan? Again I am not sure.Can see the point,but may upset those who are in it.
Thanks...so looking forward we're on a 2015 PE of 10.12 based on mid point of forecasted profit. In my view the current historical PE is spot on for a small bank and with forecasted earnings growth of 20% this year this leaves room for circa 20% SP appreciation over the year ahead as they continue to meet their target growth. Add in say 7 cps divvy fully imputed for the yeah ahead and you're looking at a circa gross 30% return for holders in the coming year
So your 20% is essentially a market rerating, PE expansion in other words?
So your 20% is essentially a market rerating, PE expansion in other words?
My view in a forward PE of about 12 is fair and reasonable for a small bank. I take your point about the debate about EPS growth, (weighted average v end of year shares on issue). I think as the market becomes more comfortable with HNZ's story some modest PE expansion isn't out of the question.
Originally Posted by Roger
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