engineer with pe of 3 and 11.6% divs due soon, page-62

actually i don't understand some people thinking that $3 to $6 is ramping..!

do some simple numbers, there are some engineering firms and in general some companies even in this current climate that are trading at PE of 10...

so under some reasonable assumptions, its possible..

they are doing something like eps of 22cents currently based on latest 2009 results..

now if for 2010 revenue doubles and profit doubles, you mibht get earnings per share of 44 cents let ' say

now after 2 to 3 years of succesful growth... the market may well re appraise this and give it a PE fo 10


so what price woud be required givein eps of 44 cents? well PE of 9 at eps of 44 cents suggest a price of $4 .. so its not un reasonable to suggest it could be in fact $3 to $6..

remember that this company jhas no ddebt, has $17m cash at bank, and $8m asset held for sale, so say $25m in cash..

another successful year could mean another $30m PAT..

so you're looking at a company with aroudn potentially $50m in cash ... while the backdrop is... recovery (albeit mild and mixed in the US) but still persistent need for our resources .. which will continue and continue (ignore the financial markets, China will not stay their economy, they will need to conintue to build cities after cities)...

FGE directly benefits from the or piggy backs the resource industry.. .. also now throw in Gorgan projects and other LNG projects based in QLD.

You can see how it can be $3 go $6