the average price achieved for Dec-21 HYE was $200/t. if the prices stay at this level, WHC will achieve an average of $300/t for FY22 FYE.
Based on my calcs (see below) at $300/t. WHC produces a free cash flow of $2.7b. That's 2/3rd of its current market cap paid for in cash in 1 year!!!! This calc assumes 19.5MT in production (vs 19 - 20.5m guidance) and production costs of $81.5/t (vs $79-$84 guidance) and doesn't even take into account $180m in carried forward tax loss benefits, and lower interest expense due to lower debt! So it's fairly conservative.
Even if Coal drops down to $150 next year, the free cashflow is $794m (20% of its market cap!!!!), you basically get your purchase price back in free cash flow in 3 years. If the management doesnt do anything silly and just pays out free cash flow as dividends (which is what they did last HY), you get your purchase price back in the next 3 years of dividends, and then just free money for the remaining 17 years!
I'm just a numbers guy, so must be missing something qualitative here, but I have absolutely no idea why anyone would sell at these prices?!?!
the average price achieved for Dec-21 HYE was $200/t. if the...
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Last
$8.25 |
Change
-0.185(2.19%) |
Mkt cap ! $6.968B | |||
| Open | High | Low | Value | Volume |
| $8.40 | $8.57 | $8.21 | $46.35M | 5.643M |
Buyers (Bids)
| No. | Vol. | Price($) |
|---|---|---|
| 5 | 3668 | $8.24 |
Sellers (Offers)
| Price($) | Vol. | No. |
|---|---|---|
| $8.25 | 15049 | 30 |
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| Last trade - 12.46pm 19/07/2024 (20 minute delay) ? |
| WHC (ASX) Chart |