Ann: 2020 AGM Presentation, page-97

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dilu

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02/12/20

21:15

Post #: 49307789
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Originally posted by dabozza: ↑

Precisely, the market cap isn't lowered by debt @bruham, it is the enterprise value that is increased. And just shy of $1.2bn is the current valuation there.

Though it's really important to note why this is the case. It's anticipated that FY20-22 will be 'peak debt' as they are investing substantial resources into the development of prawns. Bad debts are those that don't generate revenue and earnings into the future, but I reckon this is good debt because it will drive up their revenue, margins, EBITDA and eventually earnings per share.

For Tassals I prefer to look at Enterprise Value:EBTIDA. Tobias Carlisle (Acquirers Multiple) goes through this really well. And at the moment, Tassals is trading around 10.5 EV/EBITDA which is pretty low particularly for a company that's got growth potential. I don't really use PEG ratios, but that's gotta be <1 at this point too. All of this just reinforces my belief that there has to be something major for shorters to win with considering those conditions...

Meanwhile this aint the Bega thread, but for what's it worth, great strategic play, let's see if they can operationalise it though. History has shown their capacity (and legal team) have been left wanting when it comes to M&As. Happy to wait and see..

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@dabozza

For my own learning, what do you consider an acceptable EV:EBITDA?

I'm stuck in the dark ages with my P/E, CAPE, P/B and owner's earnings

TGR Price at posting: $3.56 Sentiment: Buy Disclosure: Held
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0 Great analysis

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Ann: 2020 AGM Presentation, page-97

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