ASGR, a 7% yield
Target price Rp3,333
Last 12-month cashflow +Rp 74 billion
February 24th,, 2021
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- Sales grew another 12% in the fourth quarter to Rp 1 trillion after 21% growth in the third quarter. Sales were 5% below our forecast.
- The last 12 months average quarterly growth is still negative 7%.
- We expect average growth to turn positive +10% in this next 12 months, sales to reach Rp 1.44 trillion in the fourth quarter 2021.
- Cashflow jumped to a seasonally strong Rp 451 billion in the fourth quarter up from Rp 96 billion in the third quarter.
- Average quarterly Cashflow is now Rp 19 billion. Investment spending was only Rp 3 billion.
- We use this same investment spending which with higher sales gives an average quarterly Cashflow Rp 90 billion in this next 12 months.
Higher sales, strong cashflow on low investment spending, heading to net cash, a 7% yield, higher target price...
- The balance sheet net of cash minus total liabilities was at only -Rp 246 billion in the fourth quarter from -Rp 658 billion in the third quarter, -Rp 779 billion a year ago.
- With our forecast higher free cashflow & a dividend payout of Rp 78 billion...
- ...net cash will be finally positive +Rp 36 billion in 12 months time.
- Net profit was Rp 8 billion in the fourth quarter after Rp 13 billion in the third quarter.
- The cash cost ratio of net profit add back depreciation minus sales as a percent of sales was seasonally higher at 94%.
- We use the average 92% costs to predict a much higher next 12 months net profit of Rp 156 billion
- ASGR has paid out Rp 692 billion of capital the last six years.
- At the current market value of Rp 1.07 trillion, it’s 1.56X capital paid, 0.23X sales, 0.48X assets, 0.66X equity with a 9.5% profitability & a 7.2% yield.
- Our cashflow forecast is Rp 360 billion. At 1.6% with a large 0.2X adjustment, gives a higher target price Rp3,333.