When will AMP hit $2, page-152

Simmpa - I am glad you like my “isms”. For the record....

1. I have held for many years and continue to hold thousands of AMP shares.
2. I wish I had sold back around $5 when I was concerned about mounting pressure on AMP - not Hayne Commission but competitive pressure.
3. I hang on now hoping that a takeover may produce a price over $3 in the next two years. I don’t see the current strategy doing this through profit but some people on this site may be willing to pay $3 even if the profit is not there
4. It just drives me nuts at times when I see some of the uninformed comments here. Or comments lacking analysis or not based on profit expectation. I keep reading that AMP is undervalued and that price is being manipulated.
5. All indications are that on a normalized basis that this is a company that can produce about half a billion profit per year. After the sale of the life business. It has debt. It needs much of its current capital to rebuild itself. It is facing compressed margins in the WM business. The Bank’s profit growth has stalled. AMP Capital is a growth business and is about one third of business but it is partly dependent upon life and WM business. Overall, this means that AMP should be judged as a medium growth business with a 15 times multiple. This gives a valuation of about $7.5bn or $2.30 per share. The special dividend that will come from selling the life company will just make up for no dividends from profits over a year or two. This assumes you are not pricing in downside risk. It matches the highest of the 12 month target valuations.
6. I remain concerned about the ability of Ferrari and his team to execute an effective strategy. The evidence to date is inconclusive. But there is none of success. AMP Capital’s strategy and success goes back many years. Based on good leadership.