A clarification: With regard to the cash balance you mention...

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andrew a

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18/05/21

09:25

Post #: 53239615
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Originally posted by sandy68: ↑

Investors think it is going down so why buy now.. this is what I think investors are thinking. But the apple is fallen too far and it is too late to pick at the bottom.

Since the mid year report, share price gapped down and then it followed a classic bearish pennant pattern. I began watching this closely and it was going to be overdone at some point and it did. I had to buy it.

I've held shares in companies before with similar faith. Market fails to understand value.
-MYOB got taken out by KKR, I was making a lot if noise at $2.6 saying its worth $3.5.
-Healthscope got taken out by Brookfield and was loading up at $2.4 saying it was under its asset replacement price.
-Property link group got taken out as well. Similar problem. Depressed asset price for a company that ran industrial properties. I was upset when they got taken out.
-Capilano Honey got taken out as well. I was pleased to see this go at a decent price.

The list goes on and on.....

At some point if the market doesn't appreciate it, private equity or consortium will capture them. At the moment Hum market cap is 64% business and 36% cash. They have about $176 million sitting in cash.

Let me also out it this way. If they book in 80 million in profit this FY and market cap - cash is $304 million, that gives profit return of 26% on share. These are mind boggling numbers.

After June will be a good time if anyone wants to bid for this company which is positioning for growth with profits.

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A clarification:
With regard to the cash balance you mention that HUM is sitting on being $176m - note $122m is actually restricted cash which has implications for general purpose use within the Group.
See note 5 from the Interim report ( link below).
https://www.asx.com.au/asxpdf/20210224/pdf/44sznz18w08q3f.pdf

HUM Price at posting: 97.0¢ Sentiment: Hold Disclosure: Held
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