Up or Down ??, page-3997

I think you are pretty close to the mark Rosayrov.

EBITDA of around 340mil gives around $130m NPAT which gives around 12.3c EPS which is ball park the same figures you are coming up with.
Given Prime settled 31 Dec, only 6 months of prime earnings are included in the FY22 numbers. This is why SWM is giving guidance of a pro-forma EBITDA of $350m.

However the market is forward looking, and it looks like now analysts are starting to wind back some of their numbers for FY23 and further winding back numbers for FY24. Hence profits are expected to DECLINE next year and DECLINE again the year following.

My view is similar I think to yours: at EPS of 12c, we can afford to have some windback in earnings given earnings relative to share price. In other words comparing the future fundamentals to the current share price, even with some decrease in profits, there is still value.

I also found at the SWM was kicked out of MSCI Global Small Cap Indexes. This would have meant all the index funds and trackers all exiting SWM if they followed the MSCI Global Small Cap Index. Given an increasing proportion of funds are allocated to passive and index type strategies, this has a magnified effect of stocks that are deleted.