Why SWM is worth more than $1.50 per share, page-198

In exceptional times like these one of the easiest ways to cut through the never-ending pessimism, dour forecasts and market ‘noise’ is to look at SWM from the perspective of a sum of the parts valuation. Right now SWM despite still being profitable during the sharpest ad market recession on record is being priced at levels where the business could be sold for parts and a very handsome profit still made by shareholders- no blue sky thinking required.

It seems blatantly obvious to me that the market is currently melodramatically pessimistic and that in the fullness of time SWM will trade at a healthy market multiple. Right now however we need to work to get past the worst of the worry before people can start thinking straight again. A sum of the parts valuation is a positive and straight forward place to start to achieve this.

It goes without saying that these figures will be imprecise and incorrect merely because they are valuation estimates that have been built upon a multitude of sources (including analyst reports, ASX announcements, newspaper articles and correspondence from professional investors) however the point of this exercise is to raise a broader understanding as to why today’s prices represent absolutely compelling value. I encourage you to substitute your own values based upon what you think the various business assets are worth.

(Continued shortly…)