Tomorrow is bearish, page-77

Just see a good post on BAL. I took the liberty to post it here. Many of the valid points are applicable to a2m too.
CuriousMonkey

1 posts.
Date:
18/02/16
Time:
01:44:56
Post #:
17048379
New
Traditionally PE is constructed by using old data (12 months ago) in getting the company PE. This valuation method gives an outdated PE which means is inaccurate as it does not fully represent BAL current sales movement (increment). The company is experiencing month to month boost in sales (booming). Thus, PE may not accurately show the true value (existing/current/updated).

IMO monthly sales data would always be more relevant than HY or Annual. Unlike other business, IF does not affected by seasons. So, the sale is predominantly assumed to be skyrocketed every month (according to the demand). HY report consists of 5 months old data and 1 latest figure. Dec data must be the highest (assuming inc continuously). We annualised the 6 months data to get PE, so it gives approx.. $45 to $50 PE for the current price which IMO is being conservative. Using passed 5 months to get current PE discounts the potential growth in the coming 6 months.

For those who said is overpriced, they discount the future potential growth and thus giving an outdated valuation on the fast, growing, month to month changing company.

Share market is a place where investors hold hand to hand to achieve a better outcome. Shorters do have their point of view but ultimately the winner will be the one who with perseverance, patient, passion (3P) .

THANKS!

BAL (ASX)

Price at posting:
$12.75
Sentiment:
Buy
Disclosure:
Held