Morgans are perhaps the dumbest stockbroking analysts that I've come across. Take a look at their buy recommendations over the years and see how they've performed and you'll all come to the same conclusion. Just take a look at Admedus (AHZ) which is one they had been spruiking for years. Anybody taking their advice on that would want to murder them with an axe (embarrasing disclosure: I unfortunatley hold AHZ).
Let's consider this. With 954 million securities issued let's do some back-of-the-envelope consideration of the most recent FY18 interim results (six monthly) per share then double that for full year results:
EBITDA $88 m = 9.2 c per share = 18.4c per annum
Operating cashflow $49.2 m = 5.2 c per share = 10.4 c per annum
Net profit after tax $26.7 m = 2.8 c per share = 5.6 c per annum
Plus Bodangora will come online any week which will significantly add to earnings.
Plus electricity prices are sky high.
Sure, there will be one off expense for the big refinancing for FY18 but that didn't come out of cashflow (it was incorporated into the new debt which is much more flexible than the old facility).
And Morgans say 35c per share? With a "E" of 5.6 c this is a PE of only 6.25.
I don't know what mathematical error they might've made to come to this figure. I'm hesitant to think that they claim there would be any reasonable logic behind this. It would be nothing short of idiotic.
IFN Price at posting:
60.8¢ Sentiment: Buy Disclosure: Held
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