We're scratching our heads at the intensity of market glee over share registry operator COMPUTERSHARE (CPU) after its 27 per cent net profit rise announcement on Tuesday and its forecast of earnings per share growth of more than 20 per cent this year.
It finished the year with basic EPS of just under 18c.
A 20 per cent improvement this year would lift it to almost 22c.
Advertisement: Since this shattering news came out Computershare has risen 54c to as high as $6.87 before closing at $6.77 on Wednesday (up 7c on the day).
At the peak the market was paying 38 times historical earnings for the shares and a forward p/e of 31 times.
It would take a further three years of 20 per cent earnings per share growth for the EPS figure to be high enough to make Computershare's p/e low enough to be closer to market average.
But by then, going by the present rate of improvement, it will be well over $14.
CPU Price at posting:
0.0¢ Sentiment: None Disclosure: Not Held
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