PAC - the good, bad and ugly, page-11

Hi Fidosnos

My price target for this year is $10.42. Expect this would be exceeded if FUM figures come in strongly over the year.

I reached this through back of the envelope numbers on Pacific Current (PAC) based on the underlying figures (full year, post-simplification) and comparing to industry peers. Some figures reported were part year since the trust was merged into the entity this calendar year. Have put in ratios for Platinum (PTM) and Magellan Financial Group (MFG).
Pacific Current has 47,642,330 shares on issue.
At $8.20 per share, market capitalisation is $390,667,106.

	Column 1	Column 2	Column 3
0	Measure	$​	vs Mkt Cap​
1	Underlying Revenue	$40.2 Million​	10.3%​
2	Underlying NPAT	$16.6 Million​	4.25%​
3	Underlying EBITDA	$24 Million​	6.14%​

Platinum Asset Management has 586,678,900 shares on issue.
At $5.96 per share, market capitalisation is $3,496,606,244.

	Column 1	Column 2	Column 3
0	Measure	$​	vs Mkt Cap​
1	Revenue	$333.549 Million​	9.5%​
2	NPAT	$192.647 Million​	5.51%​
3	EBITDA	$271.473 Million​	7.76%​

Magellan Financial Group has shares on issue 172,076,468.
At $24.27 per share, market capitalisation is $ 4,176,295,878.

	Column 1	Column 2	Column 3
0	Measure	$​	vs Mkt Cap​
1	Revenue	$338.268 Million​	8.1%​
2	NPAT	$196.225 Million​	4.7%​
3	NPBT	$256.127 Million​	6.13%​

PAC v PTM
From a ratio perspective, compared to underlying revenue there are minor differences between PAC and PTM.
PAC v MFG
From a ratio perspective, compare to underlying revenue to market cap, following would be applicable if PAC was measured comparably to MFG:
$40.2 M Revenue
Divided By 8.1% = $496.3 Million corrected Market Cap
$496.3 Million divided by shares on issue 47,642,330 = $10.42 per share

The above shows there is a bit more to melt up to compare with others in the industry. If we become comparable to MFG there is the possibility of $10.42 per share, which is reasonable because PAC has grown FUM as fast as MFG, market is still a bit uncertain given our recent history. Time will rectify this.

Also note I am fitting the stats to my belief of a higher share price. Based on the other ratios, PAC is as expected. This however doesn't take into account the additional improvements that we will see this year as the cost reductions would not appear in the accounts on a full year basis, nor other cost reduction measures (like the office move savings of $200k per annum).

In addition, the other businesses like PTM's revenue will decrease this financial year because they have reduced their fees by 15%.
Best of Luck
Lost