its currently around 40-45x now. in 5 years if it continues at...

First 11 Last

Share
Profile

Follow
cobrakai1984

6,630 Posts.

581

05/02/25

15:56

Post #: 77719160
Share

Originally posted by madamswer: ↑

"did I really miss by wide margins? Bit unfair. But yes I cherry picked numbers to make my point. My cherry picking is junior league when compared to the presentations by the company."

Just about all management presentations gild the lily in trying to present their company in the best possible light, in manners ranging from mild embellishment to outright misrepresentation bordering on lying. Nothing remarkable about that; it has been ever thus.

Which is why I almost never even look at presentations... because I understand from whence they originate and why. Instead, I conduct my assessment using only information contained in the audited and annotated financial statements. My firm opinion is that anyone who takes his/her investing cues from glossy presentation slides without analysing the full set of financial accounts, should not be investing on their own behalf. They would be better served buying low-cost index funds

"the number that matters most is on page 15 of the investor presentation. npata. A growth rate of 19.5% may sound impressive but that still needs another 5 years at the same growth rate."

As I said, I didn't even look at the presentation, but 19.5% pa NPATA CAGR is also the figure I have derived from my spreadsheet (FY20 NPATA of $3.9m and FY24 NPATA of $8.0m).

But as I have been saying for months now, KPG is indeed unambiguously expensive, but if it keeps doing NPATA growth somewhere in the high teens for the next 5 years, without recourse to shareholders for capital, I doubt the P/E multiple would fall by much; maybe into the high-30x, but more likely low-40x, multiple, after which the annual investment returns will mathematically be equivalent to the NPATA growth, i.e., in the mid- to high teen percentages.

I think what happened is that, in the past 3 months, the stock price got ahead of itself by 12 to 18 months' worth of earnings growth. Which means it will have to now tread water for around 12 months as it waits for the earnings growth to play some catch up and chew down the multiple. As so often happens with rapidly growing stocks.

But it doesn't for one minute mean that the investment has ceased to exists.
Rather, it has merely been paused.

.

Expand

its currently around 40-45x now. in 5 years if it continues at 15% growth compounded the p/e will be 20x not 40x.

KPG Price at posting: $10.16 Sentiment: None Disclosure: Not Held
1 Upvote

0 Great analysis

Reply

Top Stories

ASX Market Close: Index treads water as Energy stocks surge | Monday June 16, 2025

NUZ

This stock is crafting a cure for Huntington's – and it's making progress

RC1

Redcastle teams up with Terra Mining to get revenue flowing at Redcastle Reef, Queen Alexandra projects

Monday's HotCopper trends: 4DS falls short, $30B bid for Santos | June 16, 2025

Listen: HotCopper Wire Podcast 013 - They changed the IPO rules (and that's a good thing)

First 11 Last

Add to My Watchlist

What is My Watchlist?

A personalised tool to help users track selected stocks. Delivering real-time notifications on price updates, announcements, and performance stats on each to help make informed investment decisions.

(20min delay)
Last $10.59		Change 0.040(0.38%)		Mkt cap ! $475.4M

Open	High	Low	Value	Volume
$10.55	$10.76	$10.36	$375.4K	35.57K

Buyers (Bids)

No.	Vol.	Price($)
1	965	$10.25

Sellers (Offers)

Price($)	Vol.	No.
$10.63	900	1

View Market Depth

No.	Vol.	Price($)
1	965	10.250
1	50	10.210
3	562	10.200
2	250	10.170
1	500	10.150

Price($)	Vol.	No.
10.630	900	1
10.650	400	1
10.750	6000	1
10.960	1800	1
10.980	2200	1

Last trade - 16.10pm 16/06/2025 (20 minute delay)

KPG (ASX) Chart

its currently around 40-45x now. in 5 years if it continues at...

ASX Market Close: Index treads water as Energy stocks surge | Monday June 16, 2025

This stock is crafting a cure for Huntington's – and it's making progress

Redcastle teams up with Terra Mining to get revenue flowing at Redcastle Reef, Queen Alexandra projects

Monday's HotCopper trends: 4DS falls short, $30B bid for Santos | June 16, 2025

Listen: HotCopper Wire Podcast 013 - They changed the IPO rules (and that's a good thing)

Featured News

Buyers (Bids)

Sellers (Offers)

Featured News

its currently around 40-45x now. in 5 years if it continues at...

Top Stories

ASX Market Close: Index treads water as Energy stocks surge | Monday June 16, 2025

This stock is crafting a cure for Huntington's – and it's making progress

Redcastle teams up with Terra Mining to get revenue flowing at Redcastle Reef, Queen Alexandra projects

Monday's HotCopper trends: 4DS falls short, $30B bid for Santos | June 16, 2025

Listen: HotCopper Wire Podcast 013 - They changed the IPO rules (and that's a good thing)

Featured News

Buyers (Bids)

Sellers (Offers)

Featured News