interesting take on this RockhardCapital. Current market cap is $465m, if i take away the acquisition capital raise of $185m, I am left with $280m (as the current market value, prior to the capital raise).
Its been a long time since SSM traded at a market cap of $280m.
Assuming the Lend Lease acquisition is not a dud, then SSM appears reasonable value.
Share price could be impacted by the coronavirus post wash through on the economy (staff shortages, supply chain disruptions etc).
But as Mr Buffet says, one pays a high price for clear skies.
I don't think I am going to get my 70c, so I have topped up my position recently to 1.5% of the portfolio. This leaves me room to dollar average downwards based on how the market interprets the half year results.
Having said this, for me SSM is still a FY2024 story: *enough time to pass to wash through all the coronavirus impacts *enough time to fully integrate the Lend Lease acquisition and fully capture synergies.
FY2024 market forecast EPS: $0.1 which would translate into a PE of just 7.7 at current prices.
Happy to hold SSM as part of a diversified portfolio at these prices.
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