comment: emerging market equity research

The "Emerging Market's" (EM) report can be found on the MBP's website:
http://www.metabolic.com.au/

And the Cohen's Report was discussed on:
http://www.hotcopper.com.au/post_thread.asp?fid=1&tid=115525#318845

I found that EM's report complements the Cohen report as it discusses certain items in more detail but the Cohen's report is more tightly written and in the numbers field is superior IMHO.

From EM's page 6:
"If our earnings estimates are correct, then Metabolic Pharmaceuticals should turn profitable in FY08. Based on FY08 and FY09 earnings, a multiple of 30, and a discount rate of 40%, an indicated current valuation of $2.73 US, $1.97A per share is derived".

I feel that the 40% rate is extravagant; the highest I ever used was 20%. That high rate signifies that the writer considers there could be strong doubt about certain events occurring.

BTW, $1.97A should read $US1.97 and $2.73US to read: $A2.73.

EM has just one target: $2.73 while Cohen has 3: $2.29 (Pessimistic), $3.55 (Base) and $4.76 (Optimistic).

Apart from that, EM's revenue for July 2008 was $45 mill while Cohen's was $86 mill. For 2009, EM's revenue was $113 mill while Cohen's was $353 mill.

Gerry