Very undervalued stock. With current bullish in oil and gas sector, m&g and its peers will keep showing profitable results. Fair price should be at least 65-70 sen
Can someone show me how to get EPS 8.37? Try to sum up the last 4 quarters individually... 1.42 + 0.33 + 0.37 + 0.60 = 1.43 only. Huge difference. Please check!
Please sell! It is tremendously overvalued! Wrong EPS calculation in i3 investor and KLSE platform. Try adding EPS for last 4 quarters to get the real EPS.
Marine & General (M&G) - Cheapest OSV Player on Bursa: The Markings & pathway of a Gem Growth stock
A closed door meeting was held with M&G Senior Management recently along with a follow up Meeting with Investors and its all system go and smooth sailing ahead. Some key takeaways from the meeting:
- Beneficiary of Petronas Ramp up in Spending and Severe Lack of Vessels in the Market: Charter rates has been trending upwards due to sustained oil prices and ramp up in O&G activities, where demand for Vessels far outstrip the supply available in the market currently. Even ship builders are enjoying brisk business with yard capacities are beyond ordinary times and unable to cope with the demand for new builts. Refer to Keyfield latest announcements on contract wins to get a feel of latest charter rates.
- New orders are forthcoming with at least 8-9 New POV Contracts (In excess of RM500mil worth) expected to be announced soon. Management is cautiously optimistic of its fortune over the next 6 years the least with orders in hand and upcoming orders expected to keep them busy.
- Expansion into the tanker market in Middle East set to come to fruition within the next year with more contracts to be secured in this segment serving from Dubai to markets in India.
Assuming M&G achieves a revenue of RM450-500 million in FY25 with net margins of at least 15-18% (conservative given the higher charter rates the market commands currently) this would result in a net profit of at least RM70-90 million, implying that M&G is trading at an ultra low and extremely undemanding valuation of 3x PE (even on a fully diluted basis, its forward PE is still well below OSV Industry averages of 10-12x, players of which has rallied tremendously over the course of the year with Market Cap exceeding half a billion (M&G is at mere RM239 million) Currently the stock is under-researched with no research coverage.
M&G deserves to be pegged at a PER of 10-12x, given its robust order book and upcoming replenishments along with its expansion plans overseas in the tanker market. With the above PE, it is reasonable to arrive at a fair value range of RM1.10-1.33 (Management and Major shareholder has assured that there wont be immediate dilution from the potential conversion of Preference Shares which will be maturing in the year 2030). From current levels, the upside is easily 3-4x, giving the stock ample room to run and narrow the gap to its implied fair value.
This book is the result of the author's many years of experience and observation throughout his 26 years in the stockbroking industry. It was written for general public to learn to invest based on facts and not on fantasies or hearsay....
Lee Chee Wee
206 posts
Posted by Lee Chee Wee > 2024-03-26 23:35 | Report Abuse
Current price divided earnings per share. EPS 8.37