Vocus is not oversold. What's telling you this? The RSI? Sounds like a short term trader to me. Vocus intrinsic value is roughly $3.20 based upon current earnings. EPS is forecasted to be lower in FY18 by 10% so NPAT from current guidance of $160m x (1- 10%) = $144m. So FY18 EPS is expected to be $144m / 623.2m shares outstanding = 0.23c EPS. Given current sector PE around 14x this equates to a share price of 0.23c x 14 = $3.23.
Currently the share price is $2.50. Why? Big money is factoring in risk of the ASC, debt covenant and potential dividened cut. Hence, intrinsic value discounted accordingly.
Also regarding Santos, this is a commodity linked company and its profit vary accordingly to the price of that commodity. Totally different to Vocus. Bellamy is highly linked to the growth and demand of china since it exports there. Super loop is a new player and it's initial earnings will be negative but future cash flow will be positive. This produces a positive NPV which factors into the share price.
Just my 2 cents
VOC Price at posting:
$2.45 Sentiment: Hold Disclosure: Not Held
