SHJ 0.00% 80.5¢ shine justice ltd

All in good time, I think we're still got a little way to go...

  1. 165 Posts.
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    All in good time, I think we're still got a little way to go with the PPT sell down, even though those hubris rabbits playing with other people’s money fail to heed the simple fact that if they cut off the sale supply even for a little bit the share price will push forward.
    SHJ is a one of those stocks where sentiment and large shareholders have been allowed to have a huge impact on pricing. It really is strange; since listing SHJ has achieved outstanding results, albeit in a zig zag way. Taking the BS out of it, in its 3 years of trading SHJ has:
    Paid a dividend averaging at 3c
    Increased its NTA per share from 61 c to 83c (36% or 12%p.a) This is more outstanding when you consider the shift in provisions which means the NTA at listing was more like 55c meaning the NTA has increased by over 15% P.A whilst still paying above market dividends!
    Increased its revenue from 105M to 145M (38% or 13% p.a)
    Hyper-Boosted its provisions for bad debts, up to a ridiculous 21% Creating an outrageously robust company; or more accurately storing additional $30m of pure profit for a rainy day.
    In the last 6 months they have:
    • Record fees billed of $71M increasing 10.8% over prior year half.
    • Re-affirmed EBIT will be in the $36-$40M only a few months prior to year end, which is somewhat conclusive.
    Let's play out $37.5M EBIT we know H1 is 10.2 this leaves a forecast of $27.3M EBIT for H2. The $5M write-down was taken in its entirety in H1 meaning NPAT should be $19M or 11c EPS.
    With $19M NPAT, the board should be issuing dividends of 4c a share and retaining $11.4M in profit increasing the NTA to almost 90c. Note Current Net Assets including intangibles is $1.10
    With reserves OVER cooked and no new acquisitions in the last two years, there really is nothing more negative that can be done to the accounts, if anything the board may be forced to reduce the reserves ( especially if people push enough, hint hint) as they're unjustifiably high.
    This means over the next 12 months it should be business as usual with the restoration of two half yearly reports similar to each other with H2 being the base. Conservatively we should see:
    $50M EBIT
    $35M NPAT
    20c EPS and 8c Dividend
    Based on current growth percentages these figures would need to be increased by well over 10%
    They say the market is irrational longer than most can afford, and nowhere does this ring more true than for shine.
    Oversubscribed at $1 per share on 61c NTA - $100M revenue forecast - 1.5c divi forecast and an expected annual NPAT of $17.5M
    Sitting at 68c per share after 3 profitable years and almost 9c in dividends issued.  90c NTA - $150M revenue - 3-4 c divi due for last 6 months and expected NPAT of  $19M for 6months both of which should double for 2017/2018.
 
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