I prefer the old simple metrics - MC of $60m and EV of $40m ($16m+$4m tax rec).(F/C are just theoretical unless paid out IMO).To value DSK, it's about understanding normalised earnings.The past couple of years are irrelevant as they were clearly over-earning.On the other side because it listed during covid and most in the industry are males they've marked DSK down as a fad - they think gifting is dead and women don't want nice smelling items!But actually in pre-Covid FY19 (the last normalised time) they were doing $9m NPAT from 100 stores and continually growing YoY.They've now increased stores by 50%.With a little bit of operating leverage that's a ballpark normalised $15m NPAT at current store count.That gives current metrics of 4x P/E (with a third covered by cash).On a 70% payout ratio that's 17.5% divi yield or 25% grossed up.Incredible numbers.Then add store growth on top.
So apply whatever multiple you want to normalised earnings.I've said it before: Operating leverage + cyclicality + seasonality are a powerful cocktail.The question is when is normal again?FY24 will likely be tough. That will reinvigorate the bears further.The only thing that matters is that they survive - which they will given cash backing and available facilities in the unlikely event of a strong downturn.So it's more likely a FY25 play. It'll move before then as the market is forward looking. For now, best to switch off (nothing you can do).The market is good on a 6-12 month time horizon but poor beyond that - that's the opportunity.Throw in our new CEO and international expansion and that ups the multiple further.Speaking of which, Vlad started today....
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$1.17 |
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0.020(1.75%) |
Mkt cap ! $72.54M |
Open | High | Low | Value | Volume |
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Buyers (Bids)
No. | Vol. | Price($) |
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1 | 33109 | $1.15 |
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Price($) | Vol. | No. |
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No. | Vol. | Price($) |
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2 | 298 | 1.130 |
1 | 44834 | 1.115 |
1 | 500 | 1.110 |
6 | 14607 | 1.100 |
Price($) | Vol. | No. |
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1.165 | 7877 | 1 |
1.170 | 8500 | 1 |
1.180 | 18474 | 2 |
1.185 | 5837 | 1 |
1.190 | 15000 | 2 |
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