CCP has been way oversold and those who have bought in at cheap prices should do well this year. Reasons are as follows. The business is currently undertaking active recruitment with circa 620 full time staff to be employed in FY 2008.This is due to the substantial growth being achieved by the Company. This increased level of staff has resulted in an increase in the time it takes for staff to reach budgetted productivity. I.e. previously it took 3 months for new staff to reach maximum efficiency but in recent months this has moved to 5 to 6 months. Thus the downgrade by the company is specifically due to staff training/productivity issues rather then a fall in the quality or quantity of debt ledgers. This has led to an extension in the period it takes to collect cash from the ledgers. At present this would appear to be a short term issue. However, should management not be able to return staff to to the prior year productivity levels, then profitability as measured by NROE will be affected. We have been conservative in our 2008 valuation. This situation would be reversed if employee productively returns to historical levels in the next six months. Even the day traders - dare I suggest - could do well with this stock, imo it represents outstanding value at current prices.
CCP Price at posting:
0.0¢ Sentiment: Buy Disclosure: Held
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