Given investors have lost interest/confidence in PFG since the audit issue arose, its worth reiterating the investment case as we are only 2 weeks away from getting clarity on this issue (including an audit from a top tier firm). Given the audit issue was non cash and related to prior periods, the probability is high that this clarity will spark renewed interest in PFG, particularly given the H1 results should include earnings growth from recent acquisitions and a strong equity market/FUM.
Even with conservative share dilution and earnings growth assumptions, we should be looking at EPS in the low 2's, modest debt, and a growing dividend. Accordingly, assuming the audit issue is put to bed, and the market gets convinced that growth can continue, this could easily rerate to a low teens P/E, which would mean a share price of 25c-30c. Further, 40c is not unreasonable over the next year or two. While this may seem like a big ask given we are sitting at 15c, don't forget that this stock climbed well above $1 pre GFC.
PFG Price at posting:
15.0¢ Sentiment: Buy Disclosure: Held
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