Thanks Value. Fascinating stuff. I believe Valuein also...

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creditdumbness

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29/02/24

20:56

Post #: 72681238
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Originally posted by Value4983843: ↑

.
Thanks Rovic for the clarification.
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* That was CUE first dividend, so it may continue to increase for some time.
* 50% rise is large ,but a lot smaller than for other sectors when they pay the first dividend.
.
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CUE Metrics:
CUE gross profit has grown from 10 million to near enough 30 million over the last 3 years.
Gross margin was 56%,
NPAT 29.5%,
Profit before tax has been growing 19% a year.
Profit before tax normalized before tax over enterprise value was a 59%.

These are very good fundamentals, but i believe SHE will be stronger relative to market cap and even more so in a few years.

SHE is still young
SHE is a much smaller and younger company and a large dividend such as 20% this early might be considered as unsustainable or premature, but a dividend of say 3% to 5% wont harm their cash position whilst only consuming 6 weeks of current EBIT.
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Personally i would rather wait until they had at least their 4 earned sections producing, when cash flow and cash reserves are stronger. Then any subsequent dividend issued would be perceived as more sustainable.

I realize understandably that some holders might reasonable want to Cash out their investment at a reasonable price and a dividend will increase both liquidity and the share price allowing them to cash out.
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Future Market cap with 1 set of wells at P/E ratio of 4.5
In 2.5 . years we are looking at 15 million cash+EBITDA of 5 miilion
So theoretical market cap = 15+5*4.5 = 37.5 million market cap.
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Future Market cap with 3 set of wells at P/E ratio of 4.5
After 4 years , Cash= 58 million, and annual EBITDA is around 28 million
So Market cap =58 million + 4.5 * 28 million= 184 million market cap.
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Dividend strategy.
A good dividend strategy would be
1) Directors buy in once or twice
2) Issue an announcement of a official sustainable dividend policy.
3) Another buy in.
4) Issue a series of dividends.
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If they did they when the EBIT is high then we could be looking at massive re-rate of SHE.
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ATP dividend came out of the blue but they were printing money relative to market but not as strongly as SHE currently is
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GRR verbally indicated that they would pay dividends once cash reached a threshold value, and holders did lobby the B.O.D.
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Thanks for your post Rovic comparing SHE to CUE as it should give encouragement to others.

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Thanks Value. Fascinating stuff. I believe Valuein also mentioned GRR at least once but I could be wrong. I wonder if valueins entities invested in it. Anyway, great analysis Value. You're a brilliant mind.

Last edited by creditdumbness: 29/02/24

SHE Price at posting: 1.3¢ Sentiment: Sell Disclosure: Not Held
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Last 0.8¢		Change 0.001(14.3%)		Mkt cap ! $4.791M

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