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2.5¢ phoslock environmental technologies limited

Massive red flag - revenue, page-32

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stockrock

5,487 Posts.

8940

29/08/19

12:29

Post #: 40217806
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Originally posted by chuk: ↑

This year's earnings are not important to the market. That's obvious enough. On Newing's estimates this will be on a PE of 38 on next year's earnings and with earnings growth of 100% plus for the next two years and then likely to be very high growth for a number of years thereafter, a PE of 38 on next year's estimates is dirt cheap IMO. Newing probably has the same opinion given his DCF valuation of near $3.
I know the forward earnings are still speculative but it is clear they will grow very strongly for years and I think Newing is being conservative (rightly so until we get more guidance). If he is conservative that just adds to my conviction that this is dirt cheap.

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Absolutely.. not suggesting one bit that the half year that has passed will be what future earnings will be.

But it does give an idea that there is quite a bit of growth priced in already ... a P/E of 38 implies a net profit of $18,856,000 next year.

This assume no further dilution.

Calc below:

$1.30 / $0.0342 = 38.0117 P/E

$0.0342 cps x 551,341,581 = net profit $18,856,000

Last edited by stockrock: 29/08/19

PET Price at posting: $1.33 Sentiment: Buy Disclosure: Held
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