Bought Webjet back in 2015 and it's been a great ride. Participated and added more shares at every acquisitions since.
Webjet has been averaging double digits growth for the last 10 years.
Average Revenue growth 46%
Average Operational Cash Flow growth 131%
Average Earnings growth 27%
Average Book Value growth 30%
Being conservative, let's give Webjet average growth rate of 23% annually for the next 10 years if it keeps going the way it's going. This will give us a conservative PE of 46 in 10 years (historically PE usually double growth rate). The current PE is also around 40 to 50 mark.
Latest earnings per share is 37.1 cents, growing at 23% for the next 10 years will bring EPS to $2.94
Therefore the estimate share price in 10 years is around $135 (2.94 x 46)
Bringing 135 back to today's present value, we're looking at around $33 per share.
Webjet current price of $16.35 seems undervalue.
Also John Guscic currently held over 5 million shares, with an additional 3 million shares of options to be vested and expired in 2021, 2022, 2023 respectively (1 million shares for each year). This man is going to be doing his best and it's in his best interest to get this company to the moon with much of his personal wealth invested in this company.
Go Webjet!
WEB Price at posting:
$16.35 Sentiment: Hold Disclosure: Held
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