Always difficult to find companies similar to AJX for direct comparison, Plough, particularly in Australia.
There are seven companies designated as Specialty Chemical Stocks trading on the NYSE. Their recent MC and annual revenue figures available through Yahoo! Finance are given below, together with each calculated price-to-sales revenue multiple (average 2.3).
ASH Ashland Global, MC $4.625B, Sales $1.509B, P/S 3.1
CSL Carlisle Co., MC $7.303B, Sales $3.675B, P/S 2.0
CLX Clorox Co., MC $18.549B, Sales $5.973B, P/S 3.1
OMN Omnova Solns, MC $760M, Sales $480M, P/S 0.63
UNVR Univar Inc, MC $4.309B, Sales $8.074B. P/S 0.53
USNA USANA Health Sci, MC $1.821B, Sales $1.006B, P/S 1.81
WST West Pharm Serv., MC $7.471B, Sales $1.509B, P/S 4.95
RAVN Raven Industries, a specialty chemicals stock listed on the NASDAQ, has MC $1.33B, Sales of $277M for a P/S of 4.8.
These are well established companies with each showing only minor single digit revenue growth over the last three years, which again weakens any comparison with AJX.
In contrast, using Petra’s projected revenue figures based on current operations alone for FY18 ($30.1M), FY19 ($49.9M) and FY20 ($66.2M), the respective P/S ratios for AJX are 3.7, 2.2 and 1.7. So its fundamental value looks to be well reflected in its current share price, and conservative looking forward, without any allowance being made for increased sales due to expansion into new markets.
AJX Price at posting:
32.5¢ Sentiment: Buy Disclosure: Held
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