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$1.07 southern cross payments ltd

7.5% and only after year 3, seems a bit average! What's ya WACC?

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akpv

95 Posts.

18

04/11/22

21:52

Post #: 64599832
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Originally posted by BJReplay: ↑

"it was a massive proportion of ISXFEU's profits being pumped into the legal case"

If that case against ASX had a chance of coming off, of course you'd plough those profits in.

I was reviewing a business case today, expected to return a near certainty of 7.5% per annum over 20 years, after tax, inflation adjusted, but an upfront investment of $18M, and returns didn't start until year 3. Easy decision, invest $18M.

The case against ASX might have returned $100M to $466M over 2 to 5 years, depending on damages awarded, appeals, for an investment of $3M. That's a return of 1600% per annum to 3100% per annum.

Higher risk, higher return.

You'd invest in that too, if there was a tiny chance of it coming off.

The fact that they didn't make that $2.7m bet tells you everything you need to know.

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7.5% and only after year 3, seems a bit average! What's ya WACC?

SP1 Price at posting: $1.07 Sentiment: Hold Disclosure: Held
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