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54.5¢ slater & gordon limited

29 February 2017 is going to be HUGE, page-129

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Melrosian

2,018 Posts.

15/06/16

09:36

Post #: 18033995
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Originally posted by Dr.Who ↑

Alex, allow me to test your assumption, if you please.

a) S&G is a consumer law firm, agreed?

b) I'm Clive the Chippy with a crushed hand after a pile of wood collapsed while I'm removing a plank. I'm off work for months and see Slater & Gordon adverts on TV plus my Union circulated leaflets a while back saying S&G are lawyer of choice if a workplace injury.

c) Is Clive, who missed drinks with mates due to scouring the business section of the press, going to think I'm not going to that mob they are going broke; or is Clive, enjoying life despite his injury, partially oblivious to shenanigans in the business world, not going to give a second thought and just ring the hotline number to talk with S&G about his injury?

If one thinks (c) is most likely then multiply that scenario by any number of occupations and thousands of clients.

Regarding lawyer signing up for the class action. All hearsay, but intuition tells me there probably are some that have signed up, as shareholders they are entitled to participate.

That tells us nothing though. As a few on HC have pointed out if a CA is to go ahead it could be thought of as foolish not to participate if entitled. Provided no-win no-fee is what it says on the tin then $1 is better than $0 return. That is predicated on the assumption an individual is not going to have an affect on whether it goes ahead or not. Of course, if an individual would have an impact on likelihood of CA success then that is a different matter and their conscience should be examined deeply if they have remained shareholders.

A lawyer participating in a potential CA has no correlation with the likely future success of the business. A rational person would see it as simply an investor thinking may as well participate, I'm not going to stop it by not participating. Personally, I would hope employees make more of a moral judgement and abstain but if not I do understand and hold no grudge. For moral reasons I'm okay to forgo a few potential coppers and bask in seeing a SP multiple of today in 2020.

Of far more importance is lawyers leaving on mass (not one or two normal turnover), we have no evidence of that. In fact the only firm word we have is clients and employees loyalty and focus on the business as reported by Mr Grech.

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And FTSE 100 PER average around 15.
SGH forward PER less than 1.
Your multiple could be sooner rather than later.

Mel

SGH Price at posting: 40.5¢ Sentiment: Hold Disclosure: Held
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0 Great analysis

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