Buy @ $3.49
Recent Q4 results were below mkt expectation. There was a run-up in share price from a recent low of $3.24 on 28-Jan, closing at $3.80 on 16-Feb (day of Q4 results announcement). Looking at EPS vs FCF data for the past year,
- FY15 : 21.5ct vs 12.5ct
- Q415 : 4.7ct vs 1.1ct
- Q315 : 6.9ct vs 8.1ct
- Q215 : 5.7ct vs 6.0ct
- Q115 : 4.3ct ; -2.7ct
- FY14 : 21.5ct vs 19.3ct
On hindsight, the improving EPS & FCF in Q2 & Q3 must have led to a heightened mkt expectation of a further improvement in Q4, thus the share price run-up… However, when Q4 results saw a drop in EPS and big drop in FCF, mkt reacted swiftly with a sharp 24ct drop on 17-Feb and another 5ct today…
My lowest priced ones are at $3.84… treat it as averaging down… The main positive is they have guided for a continued 20ct Div for FY16… I'm betting they have a better visibility of FCF improving in the coming Qs… else, current Cash lvl is good enough for another 10ct/share payout… perhaps good enough to cover for 4Qs of shortfall in FCF… Their CAPEX ought to be lowered by their sale of a part stake in their MediaHub project… 😀