PSH was one of the few companies where it's operations were largely unaffected by the financial crisis. It still lost about 50% of it's value. In fact it's underlying earnings per share and revenue rose by more than 24% during the period that it's share price dropped by 50%. This means this company is now sitting on an underlying P/E of around 5 and a statutory 08/09 PE of around 6. In 2009/10 the company is forecasting more earnings growth. They have also promised to start normal dividends again. Based on the 2008 dividend and todays price this could be a yield of about 12% fully franked.
The company has now renewed it's two major contracts on even better terms, has reduced debt and is capitalising on growth here in South Australia.
The share price still hasn't recovered from crisis lows mostly because PSH was stupid enough to have a capital raising and leave it open to new investors who have been selling off and depressing the price. I believe this is a significant buying opportunity and I think the price will dramatically recover by the time the 09/10 results are announced and the dividend declared.
-------------------------------------- I am not an advisor. My comments are for debate and discussion only.
PSH Price at posting:
84.0¢ Sentiment: Buy Disclosure: Not Held
