News: ASH Ashley Services Group Says FY23 Full Year Dividend At 6.0 AU Cents, page-4

If you take out the impairment last half year earnings in the current half would be 2.5 cps. If the payout is 75% then that suggests a dividend of 1.5-2 cps for this half year.

The commentary in the half yearly mentioned the competitive environment reducing margins. So underlying profits might be squeezed a bit suggesting a dividend of perhaps 1.5 cps. If that could be maintained next year it suggests ongoing earnings around 4.5 cps and a dividend fully franked of perhaps 3.5 cps.

At the current share price that is a PE of 5.5 and a dividend yield of 14% ff. If you assume a PE of 8 and dividend yield of 10% (ff) is reasonable that suggests the share price should be in the mid-thirties. That is my best guess of a reasonable result with a lot of upside and downside in terms of risk given we do not get updates on how the business is travelling.

That may seem conservative assumptions on target PE and dividend, but the upcoming changes to labour market law are a major risk even given the soothing comments in the half yearly. The market will want reassurance from seeing actual results.