Mondi Share Discussion Threads

[essentialinvestor] 17/10/2019 17:23

Had a look at some of their earnings statements over the years.

Since 2007 FY (so cyclical peak pre financial crisis) Mondi have more than trebled their EPS
and more than doubled ROCE. Dividend also up over 3x. Pretty impressive
management of their business.

[moorsie2] 17/10/2019 14:42

Anything around today's levels will prove good returns in 12 months. Market always over reacts to this type of news

[essentialinvestor] 17/10/2019 14:31

Added a very small amount.

[essentialinvestor] 17/10/2019 14:24

Might revist the recent trading update morning low @ around 14.84.

[essentialinvestor] 17/10/2019 11:31

Appreciate the reply, hold a small amount.

[moorsie2] 17/10/2019 11:08

Hi EI - we are definitely past peak earnings in the cycle but a lot of this is already baked into the prices. Further linerboard falls announced today will hit sps in the very short term but in the medium term I believe the leaders of these companies will plot good paths to future high profitability. That's why I am dipping back in now

[essentialinvestor] 17/10/2019 10:41

Moorsie, I thought your view was we were past peak cycle earnings for the sector
and it was time for some caution ? - have you now changed your view..

[essentialinvestor] 16/10/2019 16:23

Agree - unless earnings are about to crater.

The share price pre update was beginning to factor in a warning that never came.

Gearing is also modest.

[moorsie2] 16/10/2019 07:20

Significant discount in value here for the highest ROCE company in this sector.

Good value invest at these levels

[justiceforthemany] 10/10/2019 13:22

Shorts closing.

[essentialinvestor] 10/10/2019 12:15

At least they did not warn.

[justiceforthemany] 10/10/2019 10:47

With key markets soon likely to trough, and with the share underperforming core peers by c20 p.p. year-to-date, we maintain our 12-month Buy rating. Despite the short-term headwinds, we think Mondi remains well positioned longer term with its low-cost asset base and growth investments supporting margins and returns.

3Q EBITDA declined -9% QoQ to �383m (2Q: �423m) a -5% miss vs limited �405m cons. With 4Q outlook implying modestly lower QoQ EBITDA, we trim 2019 EBITDA c1%, but expect investor focus to be on 2020 earnings where we lower EBITDA c7% to �1,560m given softer macro/pricing. Our PT declines -7% to �19.00 (from �20.50).

While Mondi likely to open lower, given recent under performance, we expect to see valuation support & would Buy on weakness.

[justiceforthemany] 10/10/2019 10:18

Full year EPS ~ 178c
EPS H1 96c

Shares trading at just 9x earnings.

[eentweedrie] 10/10/2019 06:54

already priced in IMHO

[justiceforthemany] 10/10/2019 06:52

EBITDA full year should still come in around 1.7Bn Euros matching last year.

UBS forecast 393M EBITDA for Q3 vs actual 383M. 2% miss

[fenners66] 10/10/2019 06:25

Just read the 3rd qtr update - imo does not read well.
Failing to capitalise on the drop in demand for plastic

[essentialinvestor] 04/10/2019 15:37

UBS note appears to anticipate a fall in Q3 earnings and muted Q4 outlook.

[essentialinvestor] 25/9/2019 12:26

I'm just giving a view, no monopoly on calling it right obvs.

[justiceforthemany] 25/9/2019 12:14

This is grossly undervalued IMO.

One could argue every stock is 'cyclical'....

[essentialinvestor] 25/9/2019 08:18

Breaking to a new lower trading range?.

[cordwainer] 24/9/2019 14:52

currently priced as though approx 40% drop in profits expected 2019 vs 2018. although a negative outlook was given for second half, the first half was 'robust' increase vs 2018 which would mean approx 80% drop in eps for 2nd half to justify today's price. If they can manage similar cash flow to first half amidst the capital expenditure programme, i estimate the final divi will be covered at least 1.4 times.
Feel free to disagree.

[eentweedrie] 20/9/2019 14:47

mega bounce coming imho

[riverman77] 28/8/2019 20:18

There's some truth in that. A low PE means profits are expected to fall, in the same way that a high yield is pricing in a dividend cut. In both scenarios you can expect to see a sharp fall in the share price.

[contrarian joe] 28/8/2019 14:02

Yes EI,a man of wise words.

[essentialinvestor] 28/8/2019 13:57

Joe, Charlie Mungar has a good saying on this, ...buying cyclicals on a low PE is a highly efficient way to destroy 50% of your capital.