Hiya jenny... Yeah looks like they did what I did and misplaced a decimal point or 2... Although I'd say just a Typo of $ instead of cents.. Woops... it still looks good though... :)....
The EPS at 100% Capacity... I think its like this... NPAT/shares on register.
Net Profit after Tax (divided by) the Number of shares on the register.
Thats your EPS... I like to consider dividend possibilities...
If the company put out a dividend at 100% EPS which is probably not going to happen but nonetheless worth considering.
At 100% with only one product. 0.045= NPAT / 300 mil shares 300M x 0.045 =$13,500,000 (net profit after tax)
Lets say now 600 mil shares. an additional product, and 3x 100% capacity. Now at 100% capacity. Assumptions the 1st product in current market prices brings in $10Mil The second product perhaps $8 mil So NPAT at 100% Capacity roughly $15-$18 Mil
EPS = 18Mill/ 600Mil shares EPS = 0.03c per share..... If company paid it all out as a dividend at 12c per share it would be a 25% return... At 30c per share its a 10% return which sounds reasonable.
Thing is now the recent orders are pushing it to 300% Capacity.... Hmmm is that 3 times the EPS... which would make it 9c per share.. A pretty good return huh?...
I think most stocks on the market average out an EPS of around 3-5 % of the share price. at an EPS of 3c per share ie 3% of a $1.00 SP at 300% capacity with an EPS of 9c ie 3% of a $3.00 SP
ASX or what ever you use to trade on should tell you the industry standard for an EPS... But seriously DYOR as my decimal place dots could end up anywhere..... I think this one is right though..
Recent reductions in China importing steel might be an indication that they could be starting to support local producers like CNH... CHINA STEEL the name says it all..
As always... Its just an opinion..
CNH Price at posting:
12.5¢ Sentiment: Buy Disclosure: Held
