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That's why share price is smashed by 60% just over last few...

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8horse

34,332 Posts.

9059

20/08/18

19:37

Post #: 35046422
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Originally posted by asb83 ↑

The problem is that in the FY announcement next week the outlook for FY19 will surely be lower than FY18. Analysts are forecasting a decent uplift in revenue from $328m in FY18 to $376m in FY19. That's a pipe dream forecast if you ask me.

The sales in China affected by non-CFDA registration account for about 10-15% of total sales - so that's an almost $50m hole in FY19 revenue that's needs to be made up elsewhere.

The FY19 outlook provided by the company next week would surely have to be conservative and assume no revenue from that side of the business. To assume some form of revenue would be taking a punt as to when they think they'll get registration. I'm struggling to see how revenue in FY19 will even meet FY18 revenue, let alone be more, as analysts are forecasting.

Having said that, it's trading at around 17x FY19 analyst estimated earnings and 22x FY18 earnings. So, at current valuation it has a lot of it already priced in.

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That's why share price is smashed by 60% just over last few months.

It's going way high on overoptimistic expectation, going down hard on overpemissitic anticipation.
It's also about how you are timing entry points. At current price, it's a gift, imo.

BAL Price at posting: $9.30 Sentiment: Buy Disclosure: Held
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0 Great analysis

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