If we says Foster's was too optimistic and that the company will only do half of what they say 5 years from now in FY19. So instead of $168m in NPAT they $84m. Given the current number of shares this is an EPS of $0.0785. On a PE of 20x this would represent a target share price of $1.57, which represents a total return of 32% p.a. and is fairly good for a risky small company. To make a forecast this long dated one would have to be quite optimistic (like the assumptions used in Foster's report) and at this early stage of the business, making that forecast is more difficult as a lot of the key factors which determine profitability could change materially over the next few years, both for the better or worse.
NNW Price at posting:
31.0¢ Sentiment: None Disclosure: Not Held
