VALUATIONS
Here are 3 different valuations for ACLNF
(1) PEG valuation
The 'peg' ( PE ratio/(% annualized earnings Growth) )
valuation is a well-respected stock valuation method.
'Fair' value for a stock is normally considered to be when
peg is unity (ie the PE ratio equals the stock's annualized
earnings growth rate).The longer the period over which
the growth is measured, the more believable is the result
(in other words, a one or two quarter 'spike' in earnings
growth should not be used in this valuation !).
A five-year period for measuring growth is usually
considered long enough to give an accurate measure of
a company's true growth. For ACLNF, this 5 year annualized
earnings growth has been about 29%. The PE ratio recently
was 6.12 (price of $15.25). This means the 'peg' for ACLNF
is 6.12/29 = 0.21. If 'fair' value means the 'peg' should
equal one, then a 'fair' value for ACLNF ,based on the
'peg' valuation is 15.25/0.21 = $72.62
PEG VALUATION = $72
(2) Sector valuation
Another valuation to place on a stock is to base it on the
financial performance of its industry sector. The problem with
this method is the stock is being valued as the 'average' stock
in its sector, even though it may well be an above-average
performer, resulting in a conservative valuation.
ACLNF is in the water transportation sub-sector of the
transportation industry sector. Here, the average PE ratio for
these stocks is 21.6 (source:Provestor) . So if ACLNF had this
'average' PE ratio, its price would be 15.25/(6.12/21.6) = $53.82
SECTOR VALUATION = $53
(3) Analysts' valuations
If many analysts follow a stock, some weight could be
given to the average valuation, as we could expect that a
number of such professionals tracking the stock, would have
considered every possible aspect of company performance in
their valuations.
In the case of ACLNF, I can find only one analyst with a
recent valuation (Midwood Research) and I quote his valuation
here which he states, represents about half of the 'peer group
multiple'.
ANALYST VALUATION = $25
FWIW,
Frank |
