@madamswer what is your current investment thesis for ZNO given...

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29/01/21

17:54

Post #: 50554855
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Originally posted by madamswer: ↑

Gee, that's some presentation.

(Most company presentations prepared for entire investment market strategy days don't go into that level of granular customer detail).

But even if one was to make a mental adjustment for some of the promotional elements contained in some of the slides, the presentation still reads like it relates to a company a great deal more valuable than a mere $220m-odd.

I can understand why - given the company is still very much in its infancy [*] and lacking in meaningful operating track record - the market might have raised an eyebrow at a valuation of half a billion dollars (which is where the market cap got to during the early Covid-mania), but at a little over $200m ... that's hardly demanding at all even if the company achieves no further top-line growth from the rate at which it exited FY2020 (viz NZ$20m, so, circa NZ$80m pa).

Because on that basis, and also assuming:

1. The Gross Profit Margin eases from the current very attractive (and probably unsustainable) levels of 74%, to a more modest 65%,

2. Cost of Doing Business ends up at $20m (the exited FY2020 at a run-rate of ~$16m), and

3. Providing for full tax rate.

...it would result in a simple P&L looking something like this:

View attachment 2671991
er

Of course, one shouldn't think that ZNO ranks in the top decile of companies in terms of quality and long-term durability and robustness. It's probably a business that belongs somewhere in the middle of the second-quartile, I think, so maybe a 6.5-out-10 or 7-out-of-10 business.

So it is unlikely to ever be consistently rated as a premium-to-market stock.

But at a P/E of just 10.5x and EV/EBIT of 7.0x, the market is saying it is a lowly 3 out of 10 business.

I reckon the market is wrong.
(I suspect the market thinks that the imperatives for governments, corporations, as well civic, sporting, and academic institutions, will magically disappear now that vaccines against the virus are being...er..."found").

[*] If Zoono was a human, I'd put the company's chronological position at about having just finished the first year of kindergarten.

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@madamswer what is your current investment thesis for ZNO given the recent quarterly? Are you still are holder? Appreciate your thoughts.

ZNO Price at posting: 97.5¢ Sentiment: Hold Disclosure: Held
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Last 3.0¢		Change 0.003(11.1%)		Mkt cap ! $6.412M

Open	High	Low	Value	Volume
2.9¢	3.0¢	2.8¢	$2.297K	76.62K

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No.	Vol.	Price($)
1	35640	2.8¢

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Price($)	Vol.	No.
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No.	Vol.	Price($)
1	35640	0.028
4	467298	0.027
3	832191	0.026
8	273250	0.025
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Price($)	Vol.	No.
0.030	2411	1
0.033	100000	1
0.034	150000	1
0.040	72000	2
0.043	54026	1

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Last 2.8¢		Change 0.003 ( 3.45 %)
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@madamswer what is your current investment thesis for ZNO given...

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