They appear to have very good prospects going forward but when...

They appear to have very good prospects going forward but when you have a co. that has almost put itself six foot under (as it did back in 2001) it tends to trade on low PE's for a long while after.................similar to what is happening to PSA currently. You also need to bear in mind that when a stock has risen 500% in 12 months after a turnaround that this sort of momentum can only last so long in most cases irrespective of the underlying fundamentals which in the last half are fantastic.

There are numerous examples of strong companies trading on (seemingly) ridiculously low PE's due to similar factors,sovereign risk etc..... Many believe KCN should be on twice the PE it has and you could easily argue the case for both ASL and KCN to be worth far more than their current price.

In the end we need to look at how the market has viewed a company historically and take that into account when doing our figures....no use in arguing with how the market views a stock. ASL has been on low PE's for a very long time and if all goes according to the script it probably will into the forseeable future............funnily enough when the earnings growth slows on this type of company it will often consolidate and the actual PE will rise!!

Cheers.

Ed.