I don’t hold this stock, however I have been reading into the business.
Main interest in TFG is getting some exposure into the comestic consumer services sector.
First glance over the fundamentals, it’s apparent this business is in survival mode, closing down under performing stores, restructuring, redundancies, acquisitions and moving on with under performing business partners.
Carried out a $10mil cap raise to invest into the business, current cash balance is at the low end $1.7mil but the CEO is prepared to back this company by throwing out a $750k lifeline (in conjunction with his 5% stake in the business) is a telling sign he is prepared to back this one.
Recent results could be showing early signs of a potential turn around with the last quarterly showing some good signs as they became cash flow positive at 1.2 cents per share.
This is offering a PE of 9.5 and could become more attractive if performance continues to turn around.
I like the sector, I think it’s a no brainer. More importantly I’m backing the CEO Paul Fielding, I think his early days with INA have proven he is capable of getting a business up and running.
I think the share price may face some head winds over the next quarter but given this is trading below book value, I’d say undervalued. So once the suspension is lifted I’ll consider the entry price.
Any thoughts here?
TFG Price at posting:
11.0¢ Sentiment: Hold Disclosure: Not Held
