Because they make 22.5% on the book value. Jeez. Yes the costs and expenses can change and they might experience turbulence in the future but which business is safe from it???? I dont think wheat/feed will quadriple in next 2 years. Also this 62.5% input costs include bird purchase and so on. Its just not feed.
It was $ 2.5 cause people were expecting 15% revenue growth so they paid pe16. Growth came with 2% so now we have pe 9(shortage impact). I believe this half we can get 7% revenue growth as inventory is in good levels.
Anyway i will always prefer companies like frm than bal, voc, fnp or srx. Paying 10x book value and believing one off 300% growth is not for me.
I like their strategy, I believe they will have a good year. December sales will be a ripper.
Lets come back in feb and check what happened.
FRM Price at posting:
$1.60 Sentiment: Buy Disclosure: Held
