Australia's premier coal testing, non destructive testing, and hydraulic services supplier CCI Holdings (CHL) has reluctantly made an earnings forecast for 2007 after shareholder pressure was brought to bear on the board. The forecast is for EPS of 3.3-3.5cps. This now places the stock on a P/E of 10.3-10.9 times current year earnings. Expectations are fior continued strong growth so the stock will continue to get re-rated towards a P/E of 15-20, implying the shares have a target price range of 50-70c to be achieved during this 2007 FY.
This is pretty attractive and implies shareprice growth of 39%-94% over the next 9 months. Not bad at all, and the good news is this is a painfully conservative forecast with the board being very gun shay after a recent law suit against them and the company left them out of pocket to the tune 1.5M. This mob will earn more than 3.5cps in 2007.
CHL Price at posting:
0.0¢ Sentiment: None Disclosure: Held
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