current p/e is this right???, page-5

Hello Doc,
Always happy to help out my TNY mates! Here is the rather convoluted answer to your query.

1. Comsec uses Aspect data where the PE is a weighted average of the current 12 month PE and the consensus forecast PE for the next fin year. This is a much lower figure due to high consensus EPS for next year (perhaps haven't been adjusted yet!).

2. Have done a few quick sums and the other figure of PE=20 is using a rolling 12 month EPS figure to calculate the PER (ie earnings from 1st half 02/03 and earnings from second half 01/02)

3 The figure I would be using in most cases (esp in a stock like CSL where there has been a significant drop in EPS for the half) is an annualised figure using this half's EPS * 2 which would give a PE of around 26 using yesterday's closing price. This is perhaps more representative of the current value.

I have no idea whether a rapid turnaround is expected for the EPS for next year as I don't follow CSL at all. Who knows........their EPS may drop next half! If a return to past performance is the case then maybe the figure of 20 may be more representative as it includes one half of last year's earnings- you will have to judge that. But for me, unless there is a good reason I'd be working on the current half times 2 and getting that figure of 26.

Regards.

Ed.