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05:14
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Originally posted by billyen
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With Codan's recent solid financial report and it's recent stock price the only logical thing to do is announce a share buyback.I think a stock buy-back of 5-10% (9M -18M) is what's needed for this company and I say it needs to be done now. that the company is extremely undervalued . This in most cases creates a floor for the stock. It's rather simple. Currently Codan is under $1. If in the next year the stock goes to $2 they have a 100% gain. Much better than keeping cash in the bank.they create liquidity . Something Codan needs. Right now a small investor selling a few thousand shares can knock the price down of the whole company by 1%.It's very cost effective , especially when interest rates are low. They can fund the repurchase a few ways. A blend of all 3 seems the logical way or just #3.Borrowing 18M (10% buyback) at a low interest rate and having the shares go up 50-100% is a effective use of shareholder resources. I actually can't think of a better one. Funny enough, they just paid that exact amount off.put Codan shares on many radar's and create even more demand.Investing in their own company not only seems like a good idea...its really the only option. If management can find a better use for 18M than I'd happily listen to what it is.The trailing 12 months EPS is 7.1 cents. A PE of 20 would value the stock at $1.42 . A PE of 25 would value the stock at $1.77. There are hundreds of stocks currently with PEs of 20 or more...some with poor results.Codan is growing it's EPS and NPAT at 35+% I only assume that the next reports in 6 months and 12 months are much the same if not better.The current PE of Codan stock is 13. This is a great buying opportunity. I ask management to take advantage of the world market sell off and buy Codan shares back now.
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you are expecting too much from the codan management.
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