There is no $2 valuation, as such on this stock by Macquarie.
What happened...is that a representative from Macquarie was interviewed on CNBC business channel this morning, at about 9.45AM Sydney time. I saw the interview.
In fact he was bullish on the stock.....suggesting that in a worst case situation (eg loans falling over) the stock would have a $2 value. (remember overnight the stock was $2.21- so his point was, even very worst case situation, there was $2 value for AFG.)
Read all six company disclosures in the last several weeks......there is no worst case situation here with AFS.
Centro have come out and said we have a problem.....AFS have over and over confirmed...NO PROBLEMS - yet their SP is down 75%.
Conservative Huntley Stockbroker out today with an update and valueation of $9.60
---------- AFG is a financial services group that invests in a range of businesses and assets expected to generate above average financial returns. Operations cover niche financial products with core asset classes including aviation, shipping, rail, property, energy infrastructure and financial assets. The group specialises in asset origination and structuring transactions, funding and managing assets and management of specialised funds. AFG fits in the growth stock category.
Event
Significant shareholder forced sale.
Full Event Analysis
Impact
Two margin lenders to Allco Principals Trust (APT) with security over 22.1 million AFG shares sold shares on January 23. These margin lenders had no other security other than the AFG shares.
We understand one investor bought 20 million shares. We speculate it may be John Kinghorn – a co-founder of Allco some 25 years ago.
Executive Chairman David Coe stated “the underlying business is performing really, really well. The market is reacting to rumour and innuendo. All we can do is concentrate on the business.”
For the bold speculator, comfortable with downside risk, it is an interesting situation, given that the market price appears to have been sharply pressured by short selling, margin liquidation and associated negative commentary.
Recommendation Impact (Last Updated: 24/01/2008) While we retain our fundamental stance and value we can only recommend Hold until the release and analysis of the FY08 interim results and associated management commentary.
Event Analysis Event: Significant shareholder forced sale.
Impact: * Two margin lenders to Allco Principals Trust (APT) with security over 22.1 million AFG shares sold shares on January 23. These margin lenders had no other security other than the AFG shares.
* This action predicated another sharp fall in the AFG share price.
* We understand one investor bought 20 million shares. We speculate it may be John Kinghorn – a co-founder of Allco some 25 years ago.
* APT is in constructive discussions with two other margin lenders with a view to completing a standstill agreement to ensure that no further stock is sold. The intent of the standstill agreement is to allow the market the opportunity to properly assess and absorb the FY08 interim and full year results.
* AFG continued to confirm “that there are no developments with regards to the company’s business which require market announcement.”
* Executive Chairman David Coe stated “the underlying business is performing really, really well. The market is reacting to rumour and innuendo. All we can do is concentrate on the business.”
* CEO David Clarke was also positive stating “that when we publicly announce our results on February 15 the broad market will understand that the business continues to perform well.”
* David Coe ruled out bringing the interim announcement forward saying the accounts will be audited and that process takes time. “In this environment even tiny changes between management accounts and audited results would be treated unfavourably.”
While we retain our fundamental stance and value we can only recommend Hold until the release and analysis of the FY08 interim results and associated management commentary. On the face of the company’s statements to the ASX, it is a strong buy. Market action has created a credibility issue so in the current climate we would like to see the audited accounts and management commentary, before recommending further action.
For the bold speculator, comfortable with downside risk, it is an interesting situation, given that the market price appears to have been sharply pressured by short selling, margin liquidation and associated negative commentary.
Back to Top
Last Price Market Cap $2.86 $1,052 (million) 52 Week High/Low $13.24 - $1.70 Sector Diversified Financials
(20min delay)