I would suggest that what you have is projects that are complex in their nature and as such it is difficult to ascertain what revenue each project generates. They have multiple lines of (potential) revenue for each project and it is difficult for most of us to clearly see their worth.
What compounds this is that these projects are often joint ventures, so CCE incomes is difficult to define. How much does lend lease get, how much does the indigenous corporation get.
The financing of each project is the third complexity i.e. debt structure etc. Is a capital raise on the cards? I'm not 100% convinced (IMO it is a 50:50). They seem to be looking towards debt rather than going to the market.
And finally the market would be weary, it has been many years of Carnegie promising yet failing to deliver. These projects are all steps in the right direction but they (by my calculations) will need larger projects to generate the revenue they need. The 100 MW proposed project will be a game changer in this area.
These are all possible reasons for the share price being where it is but DYOR.
I would counter these with the following. These projects are all coming on line over the next 18 months. This will create many opportunities to re-rate the share price. Some of these projects seem to have a great chance of leading to a pipeline of further work. For example: The most recent could result in further work with EPI; The department of defence contract could lead to further work etc etc. The partnerships that CCE have cultivated are with large corporations and this seems to be paying big benefits for the company at the moment.
Finally all of this is without mentioning CETO 6. This is still 18 months away.
As a long term (and at times very frustrated holder) I feel more confident in the direction of the company.
CCE Price at posting:
3.8¢ Sentiment: Buy Disclosure: Held
