CPU, page-2

I am a fan of "hidden champion concept" - business with monopoly market share.
CPU is one of them. Unlike the majority of other business sectors, competitors simply cannot easily enter the share registry market by spending huge capital, due to regulation, business sophistication and the required client trust to operate in information-sensitive business.

While the first half report indicates profit downgrade of about 10% in EPS (USD), compounded by Brexit,
keep in mind,
1. Projected EPS in AUD is about 0.766. The current price is trading at P/E of 11.6.

2. Its ROE 28.1% in management business from a long-term perspective indicates "well-protected" economic moat and the ability to generate strong return on invested capital, implying growth potential

3. Brexit impact on Pound value and mortgage business in UK exists. Currently, UK earning in group EBITDA makes up about 25% and historically, Pound fluctuates between 2 to 1.5 AUD. While Pounds is at 2 years-low vs AUD, Australia interest room has room to fall. So, the impact would not be a huge issue over a longer run. In terms of mortgage business, real estate and foreign interest in UK safe-haven assets still exist, especailly from China and south east Asia, due to relative political/economic stability (even after Brexit, compared to their home countries)

A market-leading business trading at P/E of 11.6 with monopoly market structures in an increasing important industry - financial information service/management.
All the hype about big data, financial technology. The market seems unable to link these future trend to CPU.
CPU is essentially that, dealing with sensitive financial information, from which new solution and technology are created to create value and help business streamline information management, in the form of both cost reduction and growth opportunity.

Eight is one of my favorite number. CPU is trading at 8.88.