Mr market appears to undervalue this stock because it doubts how sustainable its earnings and business model is in the longer term outlook. However retaining its profits - currently at good levels and paying down debt in a rising interest rate environment is not the reason the stock price is going nowhere. This policy should be providing a good platform for future price providing concerns about sustainable business model is alleviated over time. Patience is required as time will tell and therein lies the risk/return reward if the business performs with stable earnings. The share price will rocket if revenues and profit exceed the low P/E ratio assigned currently to this stock. However a major deterioration in revenues and profit will justify the low price ratio.
SWM Price at posting:
38.0¢ Sentiment: Hold Disclosure: Held
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