CDL & CDI ... Another Great Result

[blackcap]

WOW just did a quick look at last years figures...

HY 15 NPAT $8.51
SHY 15 NPAT $8.99 FY $17.5m (where SHY = second half of year)

HY 16 NPAT $15.95 with the expectation that this will continue.

In theory share price should almost double from here.....

[Vaygor1]

Maybe, both cdi and mck made the markets news on Radio NZ today. Probably a first for both.

http://podcast.radionz.co.nz/business/bus-mdr-20160803-1221-midday_markets_for_3_august_2016-048.mp3

Yes they both made the news... thanks GF.
I couldn't get your link to work for some reason, but found it if I went here:
http://www.radionz.co.nz/tags/business
and clicked the 'Listen" button under Business Briefs.

[Vaygor1]

WOW just did a quick look at last years figures...

HY 15 NPAT $8.51
SHY 15 NPAT $8.99 FY $17.5m (where SHY = second half of year)

HY 16 NPAT $15.95 with the expectation that this will continue.

In theory share price should almost double from here.....

Yes.. in theory.
According to my calcs, assuming widespread market recognition (theory again, and unlikely to occur) I get a share price over $2 per share.

[DarkHorse]

Happy holder. Has anyone tried to calculate asset backing at market value?

[blackcap]

Good to see some little bids at 77 and 76 pre open. I wonder why the market has for so long underrated this stock. I purchased my first lot way back in 2010 for 28 cents but even then that was undervalued (my opinion off course). Back to the question. Is it the liquidity? Or is it xenophobia? It cannot be the sector being out of favour because we all know what property has done. Of clutching at straws, a perceived risk because they are developers?
Anyone willing to hazard a guess? Because with 11 cents per share + earnings coming up for FY17 at 77 cents we are looking at a bargain are we not?

[BlackPeter]

...
Back to the question. Is it the liquidity? Or is it xenophobia? It cannot be the sector being out of favour because we all know what property has done. Of clutching at straws, a perceived risk because they are developers?
Anyone willing to hazard a guess?
...

Well, yes to both. Have heard people saying that they don't like boards controlled by Chinese (or Asian) people ... and you might even find similar statements on sharetrader.

Obviously - low liquidity is a reason and in my view does justify some discount (but probably not that much). It is certainly not a good idea to commit a too large part of the portfolio to illiquid companies like CDI.

One other issue is that this company is controlled by MCK, the majority shareholder- and their agenda may or may not be aligned with the interests of minority shareholders. This (lack of control) justifies another discount ... but again, whether the size of the discount is justified is a different question.

[Joshuatree]

I admit to knowing little about these two, but a quick look suggests that research is in order. Given their NTAs, P/Es and a reasonable profit their current price seems to have potential.
Is CDL under-priced do you think?

Nothing much has changed since 2004; always underpriced. Long time to wait for fair value to arrive and why would it now?

[blackcap]

Nothing much has changed since 2004; always underpriced. Long time to wait for fair value to arrive and why would it now?

So what do you think is required for fair value to arrive?
I agree with Black Peters posting that it is a variety of factors holding the share price back. Xenephobia may be one, also forgot about the MCK control etc.
So maybe if CDI were to extract fair value they need to...
1. make the board more "white middle aged men" (sarcasm here but probably a big hint of truth behind the statement unfortunately)
2. open up the register
3. communicate better with shareholders

Anyone else willing to add to the list feel free.
I find it astounding that they have almost doubled H/Y profits, the outlook is for the same for FY 17 and the share price has moved but 10%.
Does this make it more "undervalued" than it was a week ago?

[macduffy]

Both these companies - CDI and MCK - have been around for a long time and neither has ever had any market profile to speak of. Perhaps the major shareholder just isn't interested - for whatever reason. Doesn't need the publicity? Nor a higher shareprice? Nor the higher registry costs of more active market trading?
May be candidates for privatising at some stage ?

[noodles]

So what do you think is required for fair value to arrive?
I agree with Black Peters posting that it is a variety of factors holding the share price back. Xenephobia may be one, also forgot about the MCK control etc.
So maybe if CDI were to extract fair value they need to...
1. make the board more "white middle aged men" (sarcasm here but probably a big hint of truth behind the statement unfortunately)
2. open up the register
3. communicate better with shareholders

Anyone else willing to add to the list feel free.
I find it astounding that they have almost doubled H/Y profits, the outlook is for the same for FY 17 and the share price has moved but 10%.
Does this make it more "undervalued" than it was a week ago?

4. Release the massive pile of imputation credits by issuing bonus shares
5. MCK should become a pure-play hotel operator. CDI shares owned by MCK to be distributed to MCK shareholders. This will increase liquidity
6. Pay a decent dividend or use cash pile to buy back shares to underlying resale value