GTP 0.00% 12.0¢ great southern limited

sales update, page-11

  1. 393 Posts.
    mvanle

    Unusual methodology, you're carrying through a 7.25% RRR and a book value of $2.42 per share for a start.

    This is how I'd do it, as usual lives and dies by the assumptions and inputs.

    RRR=10%
    NPAT=20-50M (going forward, not just 08)
    Book value=$708M, Shares=317M gives $2.23 BVPS
    ROE= (20-50M/317M) = 2.8%-7.1%

    Valuation = (ROE/RRR)*BVPS = $0.63-$1.58

    Of course a break up and asset sale would net more than that. GTP will have to improve ROE to prevent that from being the best long term option.
 
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