STS 0.00% 72.0¢ srg limited

good fundamentals, what am i missing

  1. 75 Posts.
    I've recently started looking at STS. On fundamentals, and after dilution to 64m shares, STS looks to be undervalued by most normal measures (other than Price/NTA where it is near 1) (see below). To estimate the forward yield of the stock I have reduced the STSs div forecast by 20%. Historically, STS appear to be in the habit of overestimating eps and divs by around 10%. After this adjustment, it looks like the dividend yield is 8.2% in 2010 and 10.4% in 2011.

    All up, it seems like a good buy on fundamentals and outlook. I am not familiar with the management of the company or broader issues that may place downward pressure on the share price. Does anyone have (real not ramping) comments on the outlook of the company?

    Cheers

    Share price 0.86

    All in '000
    Total shares outstanding 63,884
    Cash 1,400
    Receivables 70,000
    Inventory 18,500
    Other current assets 300
    Current assets 90,000
    Total assets 140,000
    Intangible assets 16,200
    Payables 48,000
    Current liabilities 48,000
    Non-current liabilities 23,501
    Total liabilities 71,501

    Value of minority interests -
    value of preferred shares -

    EBITDA 16,400
    EBIT 9,250
    Earnings attributable to members 8,907

    Current ratio 1.88
    Quick ratio 1.87
    Debt/Asset ratio 0.51

    Market capitalisation 54,940
    Enterprise Value 55,041

    Enterprise multiple (EV/EBIT) 5.95
    Enterprise multiple (EV/EBITDA) 3.36

    PER 5.94
    NTA per share 0.82
    EPS 0.145

    div per share 2010 0.088462369
    div per share 2011 0.111539509
    div surprise (ds) -20%
    ds adjusted div 2010 0.071
    ds adjusted div 2011 0.089
    ds yield 2010 8.2%
    ds yeild 2011 10.4%
 
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