strategic viewpoint on IVC, page-11

Well here is Morningstar's fair value. $17. It was on the strength of this I bought in. Mstar is very conservative. They take a long term perspective as noted below (to 2022). They say " Despite the near term earnings pressure the stock is undervalued at the current price." By 2022 my status might change from investor to customer!  They effectively said they found the half year results a bit disappointing but are still taking a long term perspective. Flush with my cash from AGO I bought in at $14.18, and tried to catch the falling knife again at $12.70. I am looking for defensive dividend earning stocks taking long positions having been burnt on the speckies.  The protect and grow project appears to be producing results so i will be patient and probably buy on the dips again. Mstar are bullish on this project. I like the dividend pay out ratio. Hopefully the shorters will get caught out very soon. Due to drop in SP I signed up for the DRP. Good luck to all. Some good scholarly posts on this thread.

Valuation (Last Updated: 16-Aug-2018)
Our fair value estimate for InvoCare is AUD 17.00. per share. The valuation assumes underlying compound annual revenue and EBITDA growth of 5% and 6% per year, respectively, during the five years ending 2022.
We estimate sales to continue to grow at a mid-single-digit pace for the next five years. This growth is underpinned by the company continuing raising prices by around 3%-4% per year, low-single-digit growth in the number of deaths per year, and incremental market share gains. Over the longer term, we expect the ageing and growing population to boost case volumes; according to projections from the Australian Bureau of Statistics), this is likely to accelerate after fiscal 2022, peaking at between 2% and 3% by 2032. In our opinion, InvoCare is well positioned to capitalise on this growth, given its dominant position in the domestic market and wide economic moat.
The company is undergoing a major AUD 200 million transformation program "Protect and Grow 2020," which will include cost-cutting initiatives, and we estimate it to lift the group EBITDA margin by around 150 basis points to reach 28% by fiscal 2022. The company has spent the past decade accumulating market share, and we believe it has not yet fully leveraged its scale. This is about to change, with management seeking to better integrate shared services and more effectively leverage its scale when negotiating suppliers as part of the investment program. A large component of the benefits is expected to arise through more competitive prices for coffins, food, beverage, and transport.