Currently the SIQ share price this afternoon is $5.86 versus the Jun'22 low price of $5.77
so almost back to that low.
The major contract lost was the Vic Dept of Educ and Training ( known as DET)
Prior to the loss SIQ had 66,000 vehicles leases and 378,000 salary packages.
In DET it lost 4,000 leases and 9,000 packages.
The real question for me is what happens with the next major contract renewal due in this current H2 FY'22. I expect SIQ will make sure it retains the contract, no matter what it costs.
The low SP makes for a dividend yield of about 9% inculding franking credits. For such a high quality cash generator this is unheard of.
The current SP is pricing in no growth and no productivity benefits. Growth will come from vehicle supply returning to normal, organic growth from existing contracts where employees realise that salary packaging can make up for slow wages growth and the winning of new contracts.
I would however expect in the shortrun for the SP to get smashed until the market gets evidence of growth returning to SIQ.
SIQ Price at posting:
$5.87 Sentiment: Buy Disclosure: Held
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