Pepper is part finance business and part service provision...

Pepper is part finance business and part service provision because of all the mortgages they manage overseas but do not finance.
Divided comparisons into :
SERVICE ONLY
SG Fleet
Veda
Computer share
FINANCE MAINLY
AFG
Mortgage Choice
MIXTURE OF FINANCE AND SERVICE
Pepper
Flexi group
Thorn
Collection house
Credit corp
I believe the above companies have been used by brokers as benchmarks.
ANALYSIS
EBIT to Sales margins for Pepper within range so OK
PAT to Sales margins for Pepper within range so OK
ROA .This is difficult to calculate as hard to determine which assets are operating assets and which assets are loans to customers. However, on balance ,business model is OK but not fantastic when compared with all the above companies.
PE . Peppers is being sold cheaply when compared with all the above companies . The pure service only companies selling at very high PE which makes sense in the range 30 times and remaining two groupings fairly similar but significantly lower PE in the range 13 to 14 times . Pepper PE based on my calculations is 10.8 times. Based on this there is stag opportunity for Pepper.
GOODWILL . For the pure service businesses above you are paying about 90 percent goodwill to get into them. For the finance mainly businesses you are paying about 40 percent goodwill and for the mixed businesses like Pepper you are also paying around 40 percent goodwill.
At price of $2.60 for Pepper , Goodwill is about 19 percent. So, on this metric Pepper is cheap as well.
POSITIVES
Being sold cheaply
Vendors will retain 69 percent compared with AFG at 53 percent and Amaysim at 35 percent
NEGATIVES
Not a fantastic business model in terms of asset management when compared with others as described above
Not a clear financing or service business so market will debate over appropriate valuation.
CONCLUSION
Worth going into this but negatives above are important ?