more civilised now, page-5

comparison with other high pe stocks thanks dipapha for your comments. hope you can sleep at night with this,. yeah i admit i have lost my cool with this. For me i think less in this stock would have helped. It has a 25% chance of coming back. IF i sell its a 100% chance of losing! Thats the way i look at it.

Comparisons should be done with other high p/e stocks , most of which have experienced the wrath of investors, some of which are tolerated and deserve a premium:

Of course we don't know what WOR's growth rate will be , so its an X factor at this stage. Broker consensus has moved to around 20-25% at this stage, EPS around 90cps or forward p/e 20x earnings at $18/share .


forward p/e (2007 earnings)

-Leighton- dunked after report, now strongly up, now nearly $20 a share, forward p/e 17 but growth 16% only, and lower margins than wor.

-computershare - forward p/e 20x , growth 20-25%, say 25% , so its a pretty good growth stock, good margins as well. was dunked after their report, recovered.

-cochlear- forward p/e 26x assuming they better their forecasts. This is prolly the highest of the lot. Growth rate is high, 30% in FY07. Was dunked after their report, but has since recovered.

-CSL - was dunked before, and after report, recovered somewhat, forward p/e 23x (carries a lot of biotech premium and r&d premium).

-RMD - forward p/e 18x, dunked a lot after report, has not recovered, growth ~35% p.a

-WOW - Bought up before and after report. P/E forward is high, at around 18x.

BIL - forward p/e around 21x earnings- trades at a high premium due to capital mgmt/growth of around ~30-40%

So all in all, at a forward p/e of 20x, WOR is about fair value related to its peers, which suggests $18 could be a bottom for it. Upsides include acquisitions, contracts etc which lift its growth rate above other high p/e peers. The picture is clearer when you look at growth in 2008 where WOR is clearly superior, as global energy demand heats up.