Dont worry, no point understanding charts etc, it is more important to know what the company real value is and the below I calculated what it is worth back in August (IMO) I still it is still the case:
"1. Intrinsic Value: ROE is 17% now (really good in this market conditions); and if we want 10% shareholder return (500k = 1 c per share dividend) then our latest intrinsic value is 17%/10% x Equity so 1.7x30= $51 mil which translates into $0.920 per share. Therefore the current capitalisation is a long way away from what the company is really worth. Now is the question will market rally to catch with it? We will see. My conservative target is 1$ per share. The market rallied so rapidly that a short slow down is anticipated."
Also yes I agree ACCC will be having major impact on price, but I believe there will be no penalty.
The more important is that on the 2nd of November Australian authorities will hand in the new rules on the free range labelling. I think it will have 10,000 hens per hectare and this is what FRM already has in place (+major market players). I strongly believe it has to have this measure as it needs to attract more investment into the industry as approving 750 hens per hectare would sink the industry future.
Anyway, I can also feel 65c coming, but I am not too worried, I believe the value is 92c - $1 so the market over long time will reflect true value (if no surprises).
Good luck to us all!
FRM Price at posting:
60.0¢ Sentiment: Buy Disclosure: Held
(IMO) I still it is still the case:
