Not a bad update, if you are willing to look through.
FY24 forecasts are pretty resilient. What we are seeing is a pull back in 2H23 and 1H24, and then returning to growth. This is driven by declining volumes, increasing prices (moaty!), and flat EBIT margins (10.6% in 23, 10.4% in 24). The business is holding up quite well despite the slow down in consumer spending and customers inventories being worked through.
On a valuation basis, the current share price is better than reasonable but arguably not cheap: * PE(24)=12.7x * P/FCF(24)=7.1% or 14.1x * Dividend=5.7%, and growing.
If you believe there is a return to growth of MSD in 24 and HSD thereafter (which seems reasonable to me), then a 7.1% yield with some 6-8% EPS growth is a decent sleep-easy investment.
AMC Price at posting:
$14.09 Sentiment: Buy Disclosure: Held
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)