As per AFR: The cheapest stock on the ASX is a cash machine,...

As per AFR:

The cheapest stock on the ASX is a cash machine, says Credit Suisse analyst Paul Butler in praise of Qantas.
The airline last week posted a record $1.5 billion pre-tax profit last and announced it will pay a dividend for the first time in seven years. It also announced a $366 million on-market buyback, taking the total return of capital to $500 million.
"In addition to this we forecast Qantas to return $1.5 billion of capital to shareholders over the next two years via dividends and share buybacks. However, there is significant upside potential to our forecasts," Butler writes in a note to clients.
"In a blue sky scenario, there could be more than $3 billion of capital returned over the next three years (or about 40 per cent of its market cap)."
Butler expects further cost savings in the coming financial year due to more efficient aircraft, noting that the airline's new B787-9 are 20 per cent more fuel efficient, have 15 per cent lower maintenance costs and enable higher flight crew productivity.
He expects more details in the half-year results but hasn't yet included this potential in his estimates.
"Qantas is the cheapest stock in the ASX200 on both P/Es (6x) and free-cashflows yields (+23%)," Credit Suisse says.
"The current share price offers a highly attractive entry point, in our view, and we reiterate our 'outperform' rating and $4.80 target price."