Originally Posted by
Maverick
Good morning Sailor, top of the mornin to ya,
I wasn't going to post today or for a while after getting a bit caught up with it yesterday…you know , there's other stuff to do in life, but your post raises a very valid point.
Target $1.10 - $1.20 in 4 months seems just unrealistic. I have to agree, it just doesn't look right on a chart.
Here's my expectations of UNPAT .
This jump in HY2 is driven from 3 key areas; increased govt care funding, gaining resale volumes and selling 55 apartments .
HY1 made 7.7 cps ( annualized)
HY2 should make 10.8 cps ( annualized)
Therefore the full year = 9.6cps
The lowest PE this company has got to is PE 9.1 (now) from a high of PE 19 in 2021.
If I look at the FY 9.6cps and apply today's woeful PE 9.1 , I get a SP of $0.87 in May.
If we only consider the HY2 of 10.8cps at PE9.1 then its a SP of $0.98
87c-98c in May looks realistic as the share price would ascend to that price at the same steady inverted speed it fell over 2022. So perhaps this is more realistic. But the issue is… would we really still only give a PE of 9.1 to a company that just grew profit by 18% annually?
The “ anchor” we now seem to have locked in cement is that we accept this share is now worth 70c-74c …that's just the new norm or fact we are entrenched into now. I suggest all of us, including myself, emotionally “feel” it. ( the root of your post).
This anchor will change again - remember the days of the anchor being $1.40-$1.60 …same company making the same profit as now. It took 2 years to reform to this new anchor at 70-74c. Purley on market mood. Profit hasn't changed.
So If we slowly rise at the same gradient ( inverted) that we fell then from here we should get to $1.20 by Christmas. No sooner. This would look right and balanced on a chart.
But by Christmas I have even similar profits anticipated as HY2 2024 . How this share price travels from here is probably more suited to someone like BaaBaa to opine. This is out of my lane.
My area is on a spreadsheet. I'm happy with my work and confident we will get “miracle no1” - that is OCAs profit is going to go up nicely…but Miracle No2 is figuring out how the emotionally driven market will react. Especially with such an entrenched anchor of 70-75c.
My own guess on Miracle No2 is that we will see $.90-$1.00 in May and $ 1.20-$1.30 by Christmas.
( FYI, if my P+L math are close that would put OCA on a PE of 10 in November but also bare in mind the profit would have grown 2 HY periods in a row by then from 2023 by 40%).