A quick view of the FY2018 summary:
Using Commsec Numbers:
EPS: 11c, EPS for SHJ moves around, there is not a clear trend. I think the difficulty for investors is getting a feel for what represents EPS. Because EPS is so influenced by WIP, I don't think that its very useful to analyze SHJ using EPS, given that EPS can be distorted.
BV: $1.26, again this number incorporates WIP as well as buy outs of other legal firms. There has been alot of discussion about the actual eventual cash flow realization of WIP. There has been a good historical increase in BV over time, however this has been accompanied by a reduction in trend ROE. So for me its good to see BV increase over time, however i don't place too much importance on it.
CFPS: 10.8c: This is the number I focus on. It represents hard cash, and harder to distort (unlike EPS).
CFPS has a good clear trend of increasing over time. This is good. Once past all the smoke and mirrors, SHJ is growing its business over time as defined by cash flow per share.
NTA: $0.98: Again a number I focus on more than BV. NTA has grown over time. Importantly there is a clearer correlation between the growth in NTA and the growth in CFPS.
So for me the matrix I will use for future analysis of SHJ using a ROE evaluation analysis is CFPS/NTA instead of the traditional EPS/BV.
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