Fundamentally the group is in a similar position to where it has been for some time - according to my last analysis. That was some months ago - and I have not updated it since. Debt/Balance sheet is however better - due to the capital raisings at the cost of shareholders.
Given the 30% reduction in the dividend yield, and the increases available in other fixed interest products available currently, I may review my thinking, as the upside may no longer outweigh the downside... the stock may run to 'keep up with its peers' - but that is voting by crowds, not by weight... I like weight behind my stability decisions. If all that is left is a) follow the crowd and b) hope that a buyer emerges - I don't believe that this is enough for a piddley 4.6% return. I think I do better in a bank with no downside risk.
My previous analysis (from 2/2/10) can be seen here:
http://hotcopper.com.au/post_single.asp?fid=1&tid=1088568&msgid=6124845
And I have extracted it for you here:
I have had several thoughts about this stock - most of them unchanging - if you are interested to read all the numerical analysis, just search for posts by me - most of them will be here.
To summarise in any event:
- I have been accumulating since mid 2008.
- I have participated in all rights issues since then
- the value of the stock (taking account of discounted rights issues) is LARGELY UNCHANGED over my investment horizon
- the intrinsics of the company are far better now than they were due to a more stable balance sheet
- the exclusion of all other earnings sources apart from rental over the past period has increased the earnings multiple to a level I am uncomfortable with for such a non-growth business
- I personally am unable to place an accurate valuation on the assets, therefore I value the company based on real ability to earn repeatedly and do not factor in at this point asset price fluctuations.
I am no longer accumulating the stock. I consider it fair value at the moment. Its yield however is nearly double that of a bank, and I believe that the beefed up balance sheet, and lack of news / ship changing directions along with a simplified business has attracted stability. This is good for continued yield.
Main items that may alter the SP in the short-medium term are unchanged and include:
- the big 3 shareholders wanting more or less of the company
- a favorable/unfavorable earnings report (I expect that the company will manage to artificially increase its earnings significantly this period as a result of various hedging and currency plays - personally I ignore such movements, but the schools of fish looking for a feed may not)
- higher/lower than expected sales/acquisitions of assets
The restructuring of the number of shares etc may have some impact but really should be minimal and is what I call noise.
Bottom line: Term deposit with better terms, possibility of capital upside, lesser possibility (in my view) of downside.
Feens.
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Last
$4.12 |
Change
0.070(1.73%) |
Mkt cap ! $7.892B |
Open | High | Low | Value | Volume |
$4.06 | $4.12 | $4.05 | $42.63M | 10.37M |
Buyers (Bids)
No. | Vol. | Price($) |
---|---|---|
1 | 6063 | $4.11 |
Sellers (Offers)
Price($) | Vol. | No. |
---|---|---|
$4.12 | 218087 | 10 |
View Market Depth
No. | Vol. | Price($) |
---|---|---|
1 | 6063 | 4.110 |
1 | 6063 | 4.100 |
3 | 41653 | 4.090 |
8 | 147785 | 4.080 |
2 | 28851 | 4.070 |
Price($) | Vol. | No. |
---|---|---|
4.120 | 22431 | 4 |
4.130 | 50111 | 6 |
4.140 | 6063 | 1 |
4.150 | 8485 | 2 |
4.160 | 6185 | 1 |
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