Prospector
Not a scaredy cat anymore
- Joined
- 18 January 2006
- Posts
- 2,594
- Reactions
- 2
No wonder the Directors forgive S8 for their hostile takeover a few years ago (Today's Australian). MFS are now taking over S8 with S8's boards approval!
Prospector said:No wonder the Directors forgive S8 for their hostile takeover a few years ago (Today's Australian). MFS are now taking over S8 with S8's boards approval!
michael_selway said:How high will MFS and SEL go up today?
thx
MS
Prospector said:Its quite bizarre - I was only thinking this morning, before the announcement that I might top up. Now, both shares are 'adjust' - whatever that means.
For S8 the offer values them at 30%+ premium to last traded price, so worth getting in on as the S8 Board have supported MFS offer. For MFS - not too sure really!
Yes, that $97.4 million figure does include profit on asset related transactions. I apologise for comparing it to the $50-55 million figure - this was the estimate on operating profit.michael_selway said:Hi
did that include any one off sales?
thx
MS
I got my future EPS estimates from Commsec. The median EPS estimate of three featured brokers is currently 31.5 cents. However, say I had no access to these figures or any analyst reports, I am still able to have a 'guess' as to how MFS will perform in the coming year.smoothsatin said:Not to dull your enthusiam, but i should clear a few things up for people reading your post, eps for 06 was 0.43, almost exactly in line with broker forecasts, also what are you basing your eps future estimates on? You probably need to differentiate between recurring income and profit from transaction income. Frankly, broker estimates for a company like MFS in 08, whose profit is far more sensitive to individual deals than mbl, bnb etc, are stabs in the dark at best.
Otherwise your diagnosis looks pretty good
I think that at this level (about $4.10), MFS is very worth getting into. Not only was the (at one stage) 8% drop a good time to get in, I think it was an overreaction to the announcement. Perhaps the market believes that MFS is overvaluing S8 Ltd.Prospector said:Its quite bizarre - I was only thinking this morning, before the announcement that I might top up. Now, both shares are 'adjust' - whatever that means.
For S8 the offer values them at 30%+ premium to last traded price, so worth getting in on as the S8 Board have supported MFS offer. For MFS - not too sure really!
smoothsatin said:2 x change of directors notice, it must be to signal confidence to the market whose initial reaction was poor, they seriously wouldnt need to increase their respective holding by 0.5%!
dubiousinfo said:MFS currently trading at $4.14
If you buy SEL at $ 4.43 after takeover & cash of 70c + spec div 15c the entry point is $ 3.58
Plus leaves you exposed to any higher bids (though this seems unlikely)
The risk would be if the take over failed the SP of SEL is going to tank.
Date: 5/9/2006
Author: Anthony Klan
Source: The Australian --- Page: 23
Queensland investment group MFS launched a $A700m takeover bid for S8 on 4 September 2006. At around $A5 a share, the off-market bid was almost 40 per cent above S8's previous close. However, the deal may be blocked by the Australian Competition & Consumer Commission, as it would give MFS control of 13,000 holiday units - about 20 per cent of the management rights sector. S8 has been the subject of investigations into its domestic travel agency business after claims that it charged overly high commissions
MFS MFS LIMITED Overnight Price: $3.87
ABN Amro rates the stock as Buy - Initiation of Coverage - The broker sees the stock as having significant growth potential, with success in the S8 (SEL) merger proposal likely to see assets under management increase from around $3bn to $5bn.
It estimates the S8 proposal would add 4% to earnings in FY07, with other attractions of the story being the growing annuity stream and the minimal capex and capital requirements.
Without including S8 in its calculations the broker values MFS at $5.15.
Sector: Diversified Financials.
Target price is $5.15 Current Price is $3.87 Difference:$1.28 - (brackets indicate current price is over target). If MFS meets the ABN Amro target it will return approximately 33% (excluding dividends, fees and charges - negative figures indicate an expected loss).
------------------
Macquarie 25-Aug-06 1 Outperform $5.43 40.3%
The broker has raised its target on the stock by 23c to $5.43 following the result.
The stock is one of the broker’s best small cap picks.
------------------
UBS 24-Aug-06 1 Buy 2 $5.21 34.6%
Following the Outrigger acquisition, the analysts are increasing confident in the stock, and have increased their target by 16c to $5.21.
Deal pipeline seen as healthy.
SEL S8 LIMITED Overnight Price: $4.30
ABN Amro rates the stock as Buy - The broker has retained its rating following the merger proposal as it suggests S8 offers an attractive entry into MFS (MFS).
Additionally the broker notes the company''s profit result of $20.9m was slightly better than guidance, while management indicated earnings in FY07 and FY08 were likely to be $44m and $60m respectively.
Valuation is $6.18.
Sector: Real Estate.
Target price is $5.00 Current Price is $4.30 Difference:$0.70 - (brackets indicate current price is over target). If SEL meets the ABN Amro target it will return approximately 16% (excluding dividends, fees and charges - negative figures indicate an expected loss).
--------------------------------------------------------------------------------
Credit Suisse rates the stock as Outperform - The analysts see the discussed union with MFS as offering potentially significant benefits, but they need to find out more about the details.
Sector: Real Estate.
Target price is $4.75 Current Price is $4.30 Difference:$0.45 - (brackets indicate current price is over target). If SEL meets the Credit Suisse target it will return approximately 10% (excluding dividends, fees and charges - negative figures indicate an expected loss).
--------------------------------------------------------------------------------
SB Citigroup rates the stock as Downgrade to Hold from Buy, High Risk - Target $4.71 (was $4.95). The broker notes the profit result was a strong one but has been overshadowed by the merger deal with MFS (MFS).
In the broker''s view the deal is likely to succeed and should offer a number of chances for cost savings and economies of scale.
Valuation is $5.50.
Sector: Real Estate.
Target price is $4.71 Current Price is $4.30 Difference:$0.41 - (brackets indicate current price is over target). If SEL meets the SB Citigroup target it will return approximately 10% (excluding dividends, fees and charges - negative figures indicate an expected loss).
So just to clarify things, are you saying that by buying S8 at $4.15, you are effectively buying MFS at $3.30?dubiousinfo said:Providing the deal goes through, buying S8 at its current price of $4.15 gives you an entry to MFS of $3.30.
Think I will get me some of that.
We use cookies and similar technologies for the following purposes:
Do you accept cookies and these technologies?
We use cookies and similar technologies for the following purposes:
Do you accept cookies and these technologies?