Hi @madamswer - to be honest, I have no specific catalyst, other than expecting the following:
- The earnings drop not to be as brutal as most expect. There are high fixed costs in this business for sure, but I still expect EBIT to top $100m in a really bad case - BVOD growth will eventually mean the digital business is just as important as the legacy TV/broadcasting biz. Coupled with the price increases/focus on reducing losses from Netflix, Stan, etc, there's sufficient room for BVOD to continue it's amazing growth rate. - 1x EBITDA/Net Debt will result in a clean balance sheet very soon. Unless they go much harder on the buyback, I fully expect their parent (SGH) will demand capital returned to them in the form of dividends.
There's no immediate catalyst, other than perhaps the final point. But in the best case, this turns from "legacy media business" to "booming BVOD business". With the removal of cookies and retreat of streaming business to a degree, the data set and advertising opportunities provided by companies like 7Plus will become extremely powerful.
That's the best case. But in most cases, it's hard to lose money from here.
SWM Price at posting:
43.0¢ Sentiment: Buy Disclosure: Held
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