Would be a bad move by Woodside. On the most recent half year earnings (227.5m) - annualising would give a rather chunky PE of 22.3. And there's a good chance things will get worse in the LNG market:
- The industry is set to be disrupted by a tidal wave of supply coming online; e.g. the three projects in Queensland.
- Murmurings of Japan ramping back up nuclear.
For Woodside to swallow this it would need to pay a premium, probably taking the PE multiple to 30 times (vulnerable) earnings. If they do this I'll be writing to management as a holder of the company in my super fund.
OSH Price at posting:
$6.89 Sentiment: Sell Disclosure: Not Held
