18 replies to this topic

[SoleTrader]

Looking cheap on the disposal of NOSA, as highlighted in the SENS. Dividend could be closer to 500c. The disposal puts the remainder of the business on a PE of 5x ex cash, growing at 20%+. Hopefully we see 1700c by the LDT.

[Bullhunter]

Fair value=R14.06 (+39%)

[SoleTrader]

Rumours getting stronger that the cautionary is almost concluded and will be announced before end October. Big volume traded today I see. Let's cross fingers!

[SoleTrader]

From what I have gathered they are confident to grow at 20% this year, so EPS of 180c. The stock is very cheap, maybe the Dave King discount? I also believe that the cautionary relates to them disposing of their Government business - I suppose they are negotiating with the purchaser on which part of MMG will go with the new vendor. So post this deal most likely a very smaller business, and a very big special dividend coming our way.

[Bullhunter]

I can't agree with you. The trading update said it all. Let's say they do 150c in earnings. As an investor, for a SA company growing at 20%, what PE ratio would be fair? My rule of thumb is PE = 10*(1+ %Growth) for the share. So in the case of MMG, PE = 10*(1+0.2) = 12. So Price = PE * EPS, or 12*150c =1800c. Buffett's so-called moat of safety, buying a R18 share for R11. Currently this is my biggest SmallCap exposure. So hoping for the best!

Update using your equation, MMG should be trading at R14.14

[SoleTrader]

I am still hoping that HEPS is closer to 160c. Anyway, very cheap at 6.5 PE. More interesting are the consistent rumors of imminent corporate action that will change the direction of the company. We wait with baited breath.

Earnings damn close! more important is the SENS today confirming the rumors that have been floating around. 

[MrDividend]

 

 

Further to the trading statement released on SENS on 19 May 2017, a review of the financial results for
the year ended 31 March 2017 by management has indicated that:

- the headline earnings per share (“HEPS”) is 157.76 cents, reflecting an increase of 28%,
compared to the HEPS of 123.43 cents for the year ended 31 March 2016; and

- the earnings per share (“EPS”) is 155.59 cents, reflecting an increase of 20%, compared to the
EPS of 129.64 cents for the year ended 31 March 2016.

 

Pretty happy with that - will that be enough to get it out of it's R10 - R12 trading range though? They are good dividend payers though - so if they chuck on the 20% on to last years 43c - so around 52c.

 

Happy to keep this long term and pick up the divi's - do have a a few for trade though, looking for around R13 pre LDT.

[SoleTrader]

I have also been watching them, but the trading update did not have something concrete for me to jump on.

I can't agree with you. The trading update said it all. Let's say they do 150c in earnings. As an investor, for a SA company growing at 20%, what PE ratio would be fair? My rule of thumb is PE = 10*(1+ %Growth) for the share. So in the case of MMG, PE = 10*(1+0.2) = 12. So Price = PE * EPS, or 12*150c =1800c. Buffett's so-called moat of safety, buying a R18 share for R11. Currently this is my biggest SmallCap exposure. So hoping for the best!

[SoleTrader]

Ultimately, the share price will follow the earnings trajectory.  And i think the rerating of the stock has started.  

[SoleTrader]

I am still hoping that HEPS is closer to 160c. Anyway, very cheap at 6.5 PE. More interesting are the consistent rumors of imminent corporate action that will change the direction of the company. We wait with baited breath.

[MrDividend]

Good trading update. Looking ridiculously cheap. Let's take some more at sub 11.

 

Very cryptic TU - seems like they have left it open ended.

[SoleTrader]

Good trading update. Looking ridiculously cheap. Let's take some more at sub 11.

[SoleTrader]

Bids are building up. Some very interesting rumours of a tie up with an international investment bank floating around.

[MrDividend]

Still holding it myself - as well as ADI. Still a couple of months out for a TU. Bit of resistance around 1200 - needs a decent TU to get over it. 

[SoleTrader]

Slowly recovering,  i am hoping for 160c HEPS for the year, puts the stock on a sub-7 PE ratio.  Compare this to ADI ridiculous 20x

[SoleTrader]

According to Dave King the share is worth in excess of R30. And I tend to agree with him. The IT business is growing at a similar rate to Adaptit and EOH. Been accumulating under R10.

[MrDividend]

This share is looking ridiculously undervalued. Management is growing their earnings comfortably at 20%+. They should do 150c HEPS for the full year, with upside surprise. At R10 the share is cheap.

 

Agreed. Handy dividend as well.

[SoleTrader]

This share is looking ridiculously undervalued. Management is growing their earnings comfortably at 20%+. They should do 150c HEPS for the full year, with upside surprise. At R10 the share is cheap.