Ann: Preliminary Final Report, page-8

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saintex

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27/08/24

14:42

Post #: 75396677
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Originally posted by madamswer: ↑

"Based on FY 24 figures and a share price of 80c, the stock has a PE 24 of 14.4 and a free cash flow yield of 9.6 % (if we look at the free cash flow of 5.5 m$, excluding the favourable impact of working capital)."

Hmmm, I think it's very libertine to capitalise EPS which have been boosted by a tax benefit. Far more reasonable, I feel, to exclude the tax benefit. Or, as a matter of prudence, my preference would be to use EPS after the application of a notional tax expense, in which case trailing EPS becomes something like 3.7cps, implying a P/E multiple of around 21x.

But in this company's case, there is a very large discrepancy between accountingprofits (per the P&L) and cashprofits (per the Cash Flow Statement), implying that the P&L probably understates the earnings capacity of the company, so I do think that using FCF multiples (or FCF yields) presents the truer valuation picture.

(Why there is such a discrepancy between the P&L and the Cash Flow Statement I've not had chance to figure out, but at some point when I have some spare time, I'll conduct the reconciliation exercise to discern how the company and its auditors account for profits and expenses.)

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You're right.
It would be more cautious to look at a PE based on a normal tax rate.
At the same time, they still have a significant level of tax loss carry forward (tax losses not recognised of 4.3 m$ at the end of FY 24).
So they are not going to pay a normal tax rate before FY 26.
This absence of tax is also helping a bit their cash flow.

MYG Price at posting: 74.0¢ Sentiment: Buy Disclosure: Held
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0 Great analysis

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(20min delay)
Last 77.0¢		Change -0.030(3.75%)		Mkt cap ! $70.43M

Open	High	Low	Value	Volume
77.0¢	77.0¢	77.0¢	$89	115

Buyers (Bids)

No.	Vol.	Price($)
2	116	79.0¢

Sellers (Offers)

Price($)	Vol.	No.
80.0¢	28209	3

View Market Depth

No.	Vol.	Price($)
2	116	0.790
1	8603	0.770
1	6600	0.760
1	13424	0.745
2	25504	0.735

Price($)	Vol.	No.
0.800	28209	3
0.810	10675	1
0.820	8000	1
0.830	8059	1
0.835	6655	1

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Ann: Preliminary Final Report, page-8

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Ann: Preliminary Final Report, page-8

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