No worries Marcus. As ZEN have only been on the ASX for 18 months there isn't enough publicly available accounts data to have a picture of how they've performed through the same cycles as PEA. Looking forward, I don't have sufficient understanding of this business to understand whether there is some characteristic of ZEN's management or business model to justify their apparent premium
Yes - my prognosis on PEA is cautious. I do believe, however, that there is limited downside in the next couple of years due to the long term nature of its contracts. I also think that the company's own earnings forecasts for FY19 are conservative. My own are as follows:
Revenue: $79.6m + other income $0.7m
Operating Costs: $23.2m (made up of consumables/parts $6.9m, employee benefits $12.4m and other $3.9m)
EBITDA: $57.1m
Depreciation+Amortisation: $22.2m
Interest cost: $4.1m
NPBT: $30.9m
Tax: $9.3m
NPAT: $21.6m
Free cash flow: $23.1m, FCF yield approx. 9.4% at today's $0.57 SP.
This assumes $20m stay-in-business capex (hopefully overstated as they consolidate with Contract Power) and no change in working capital.
ZEN vs PEA, page-8
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Last
$1.09 |
Change
0.005(0.46%) |
Mkt cap ! n/a | |||
| Open | High | Low | Value | Volume |
| $1.09 | $1.09 | $1.09 | $80.13K | 73.80K |
Buyers (Bids)
| No. | Vol. | Price($) |
|---|---|---|
| 3 | 20979 | $1.09 |
Sellers (Offers)
| Price($) | Vol. | No. |
|---|---|---|
| $1.09 | 93741 | 7 |
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| Last trade - 13.41pm 24/09/2019 (20 minute delay) ? |
| PEA (ASX) Chart |
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