OVH Chart, page-16

I have been using Netwealth to compare to. I feel NWL is the leader in the disruption arena. This is what I see:

NWL earns 8.5c and pays a dividend of 5.4c
OVH earns 2.7c but pays nothing.

NWL has a share price of $8.00 and OVH 65c

NWL has $53million of net cash and OVH net of $13 million.

So on an analysis NWL trades at 94 times and OVH trades at 24 times.
NWL trades at 12.3 times the price of OVH and they have 4 times the net cash.

Actually, if you date range OVH to when it was trading to the results they tracked very similarly.

So what disappointed (OVH) and I think it pretty clear to me:

1. They mentioned earlier that a dividend from the sale of the business they sold would be paid - that has not happened - nor did they say why or even mention it again.
2. Holders in Diversa had been getting the message that 2018 we would get dividends flowing and now that has gone and refer to item 1 as well.
3. OVH has traditionally done better in the second half to the first so I think that the punters had a different number in mind than they got.
4. NWL as the disruption leader has developed a following and its got a lot of punters saying its the next HUB...
5. OVH communication of late has been bland and vague.
6. The KPMG acquisition will change the nature of the business and that has to unfold but we cannot as yet see how.
7. Its dragged on too long. By now people want a return and NWL is paying out 63.5% of its earnings and OVH is paying nothing. I don't think that anyone here actually understands why they are not paying a dividend. My understanding is that they don't have franking credits and the likes of TOP and its leaders who have large holdings here will be discouraging dividends that are unfranked.
8. They need to communicate better about what their ultimate intentions are...

On a metrics-based analysis in my view, OVH is very undervalued but the market won't see that until it all unfolds.

I am happy that they build cash and make further investments without dilution until they have franking credits to pay dividends. OVH is at the profitability inflexion point NWL is beyond that so that is the best reason I can see for the difference. Please note that NWL also made less than the first half in EPS this financial year. I think that OVH was just improving on losses before and scale made them make more in the second halves, not the business cycle.

So I will keep adding and wait patiently...