There is much enthusiasm for EML as a stock, and based on the fast-growing-disruptor-fintech story, EML as a stock appeals to me, but there are considerations that bother me. I am not trying to be negative, I just want good reasons, as opposed to enthusiastic rah-rah-rah, to be more positive than I now feel about investing in EML. If you look at the PNC subforum, you will see how over a few years the dream has collapsed, and how yesterday's cheer brigade are now either vociferous critics, or bitterly silent.
On the seductive go-for-the-banking-sector-disruptors theme, IT-based product disruptors in time become disruptees. WordPerfect disrupted Wang's words processing business. Microsoft's Word quickly ousted WordPerfect when Windows became the dominant operating system, and today free products like OpenOffice have eroded the dominance and profitability of Word, and Excel for that matter. Intellect-based business like EMLattract sharp minds, and IT products are substantially not patentable, or difficult to eclipse. Entrepreneurs who have clear visions of what functionality they want can easily hire IT geeks to deliver on specification of what is required.
My biggest problem is evaluating EML along traditional NPAT-based lines of thinking, when the current focus in respect to EML tends to be EBITDA based, and often only revenue based. Charlie Munger and Warren Buffet are both famous for saying that EBITDAbased such stock promotion presentations are dubious. Google Munger Buffet EBITDA, and you will see why.
Because I tend to look at guesstimated future NPAT, how would I get a feel for what that might be over FY20, FY21 and FY22? I know that NPAT can be manipulated by what accounting entries get into the Balance Sheet, rather than into trading accounts, and that cashflow can be enhanced by selling the family silver, so I look at these issue too.
A highly significant factor for me is ethics – I am filled with dissonance if total Revenue, EBITDA, NPBT, NPAT and other things are the focus of a presentation at a time when shifting share counts meaningfully alter the per-share equivalents of these metrics.
The link provided in the opening post to this thread gives us an EBITDA-based evaluation resulting in a $9.00 target, based on what is expected for FY22. As an aside, I think the analyst use the wrong share count. How would I get from that EBITADA FY22 basis to an EPS basis to justify a target of circa $9.00, and is it a 12-month target, or a target for a longer period? I have generated guesstimates that fall far short of doing that, in the absence of a highly elevated PER.
In summary, what is EML's EPS trajectory guesstimated to be for the period ending 30/06/2022, and beyond that if one is inclined to be adventurous?
- Forums
- ASX - By Stock
- EML
- A Game Changer
A Game Changer, page-96
-
- There are more pages in this discussion • 8 more messages in this thread...
You’re viewing a single post only. To view the entire thread just sign in or Join Now (FREE)
Featured News
Add EML (ASX) to my watchlist
(20min delay)
|
|||||
Last
79.5¢ |
Change
0.000(0.00%) |
Mkt cap ! $298.2M |
Open | High | Low | Value | Volume |
79.0¢ | 80.0¢ | 77.0¢ | $1.045M | 1.327M |
Buyers (Bids)
No. | Vol. | Price($) |
---|---|---|
1 | 13642 | 79.0¢ |
Sellers (Offers)
Price($) | Vol. | No. |
---|---|---|
80.0¢ | 56066 | 6 |
View Market Depth
No. | Vol. | Price($) |
---|---|---|
1 | 13642 | 0.790 |
3 | 59599 | 0.785 |
2 | 7565 | 0.775 |
2 | 18896 | 0.770 |
5 | 28938 | 0.765 |
Price($) | Vol. | No. |
---|---|---|
0.800 | 43818 | 5 |
0.805 | 50000 | 1 |
0.810 | 2000 | 1 |
0.815 | 51228 | 4 |
0.820 | 96364 | 5 |
Last trade - 16.10pm 23/08/2024 (20 minute delay) ? |
Featured News
EML (ASX) Chart |
The Watchlist
SER
STRATEGIC ENERGY RESOURCES LIMITED
David DeTata, Managing Director
David DeTata
Managing Director
SPONSORED BY The Market Online