JaseReasons why BOL is undervalued:1. Trading at significant...

Jase

Reasons why BOL is undervalued:

1. Trading at significant discount to NTA. The TA (Tangible Assets) includes cranes which happen to be in short supply in Australia at present.
2. Operating cashflow is strong, on track for something like 35-40c per share over the full year. At that rate, BOL could the buy itself back in less than 3 years.
3. Trading at an earnings yield (reverse of PE) of 23% on full year figures and 17% on half year figures. Either is a damn good return.
4. Full year ROE of 13% half year ROE of 9%. However the E in ROE can be bought at essentially half price since BOL's book value is around $1.67. Do the math, that's cheap.

Key problem in your analysis Jase, debt ratio's are a measure of risk, not value. As a going concern BOL is dirt cheap. After a break-up, it would probably still net $1 a share.