eureka report, page-16

Kotsos is truthfull.

A portion of the report is shown below:

...Asciano will report its half-year results on February 24; most analysts expect it will show the company?s first ever December-half profit. If we assume that the profit projections are conservative and have taken into account lower prices in Melbourne?s ports and on Queensland?s rail network, the returns on equity ? which others don?t care too much about ? will average 7% for the next three years. This is unspectacular.

No dividends are expected in 2010 but a payout ratio of 65% is expected for the subsequent two years. Taking all of this into account and adopting a 9% discount rate ? the lowest I have ever given for any company ? I get a valuation of 73?.

The valuation rises for the next few years but goes nowhere the current price of $1.70 or the broker?s target prices of about $2.