It really is the most ridiculous valuation at these levels. Sure, it doesn't help to have a 40% plus shareholder who doesn't care much about smaller shareholder interests, BUT ultimately as stock is bought back and KS's shareholding creeps higher, he will likely look to take out minority holders as some have suggested. Why? Because if he owns the business outright he accesses a monster cash cow. For example, assume approx 10% of shares bought back, meaning about 1.44b on issue. Even at a stock price of $1.00 (a takeover value?) and $1.44b market cap, for argument's sake, in a year's time and estimated net debt (assuming no big deal) of $200m, that is an EV of $1.64b. But KS need only buy out under 55% of outstanding stock, given his shareholding creeping up. That would be an investment of .55*$1.44b or $792m. Add in the net debt of $200m and he's using $992m of invested capital in a potential deal. For that, he gets his hands on (consolidates) over $200m of annual cash generation. It's a cash return of well over 20%. To me, that shows a clear pathway to a $1 valuation. KS must licking his lips as the buyback kicks in, knowing that ultimately he can own this huge cash generator, with very limited debt, for a song
- Forums
- ASX - By Stock
- SWM
- Ann: SWM announces on-market buy-back
Ann: SWM announces on-market buy-back, page-33
-
- There are more pages in this discussion • 1 more message 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 SWM (ASX) to my watchlist
|
|||||
Last
17.5¢ |
Change
0.005(2.94%) |
Mkt cap ! $269.3M |
Open | High | Low | Value | Volume |
17.0¢ | 17.5¢ | 16.8¢ | $145.6K | 860.4K |
Buyers (Bids)
No. | Vol. | Price($) |
---|---|---|
5 | 312976 | 16.5¢ |
Sellers (Offers)
Price($) | Vol. | No. |
---|---|---|
17.5¢ | 441918 | 10 |
View Market Depth
No. | Vol. | Price($) |
---|---|---|
5 | 312976 | 0.165 |
10 | 465895 | 0.160 |
7 | 647193 | 0.155 |
24 | 635573 | 0.150 |
3 | 239699 | 0.145 |
Price($) | Vol. | No. |
---|---|---|
0.175 | 441918 | 10 |
0.180 | 212540 | 7 |
0.185 | 231186 | 6 |
0.190 | 528059 | 8 |
0.195 | 92027 | 3 |
Last trade - 16.10pm 28/08/2024 (20 minute delay) ? |
Featured News
SWM (ASX) Chart |
The Watchlist
UNT
UNITH LTD
Idan Schmorak, CEO
Idan Schmorak
CEO
Previous Video
Next Video
SPONSORED BY The Market Online