ksc valuation?, page-16

KSC has been around for a long time, and it is in a difficult business, trucking. I would think a P/E ratio of about 10 is apt, so if we assume its EPS for the year is going to be about 22.6 cents, then $2.26 is a fair price. Its growth over the long haul is close to being non est, its ROE is ordinary - look at the numbers yourself. Like many stocks today, KSC is probably fully priced at the current SP of $2.20.

Mind you, it is difficult to find under-priced stocks now, so many holders will simply hang on for the dividend - 5 cents interim dividend paid 30/03/2012, and 6 cents final dividend paid on 31/10/2012. The next interim dividend will be 6.5 cents paid on 20/3/2013. For argument's sake let us presume that the next two dividends sum to 14 cents. At an SP of $2.20, that is a yield of 6.36%, and adding on the franking credits, gives 9.1% - not bad in these low-yield times.