CCI Holdings (CHL) has an established position in it's coal mining services sector, a sector enjoying an unparalelled boom on the back of rising volumes of export coal to meet global demand.
Yet because the company has gone through an ill-timed accounting restructure, it was posting non cash writedowns,and subsequent net losses, while the rest of it's sector was growing with the resources boom. During this period CCI's business also grew strongly but this was hidden by these large accounting writedowns......not so any more.
Now, the company is back to reporting results free of writedowns and it is half priced, trading on a P/E of just 11 when most in this booming sector are trading at multiples above 20.
The gap is starting to be closed though, as the shares have commenced their catch-up moving from 16-24 over the last 10 weeks.
There is still a way to go though, as on a comparative P/E to the rest of it's sector stocks it should be priced at around 44c.
CHL Price at posting:
0.0¢ Sentiment: None Disclosure: Held
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