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@rainmaker2k,

hope its ok to sort of follow up on your post-

appreciate to see the basis for your valuation that SHV is worth $7?
with a slight margin of safety on current earnings to stay stable (say 10%), with a 50cents earnings, that puts the your valuation at 14 multiples..
which is in the league of the great co's like woolies.. in fact, that's more expensive than QBE.. which can be expected to grow based on its acquisition strategy.

how is SHV going to grow its earnings?.. the headwinds to its long term growth seem to include:
- cyclical exposed to weather, currency risks
- agriculture is capital intensive
- in the commodity business.. price taker, no inflation protection

so, would seem to be a slow grower.. say 3%-5% .. ie, may be multiples of 8-12, which puts it at $4-$6?

would be interested in your reasoning..

cheers,

<blockquote data-quote="venger" data-source="post: 550791" data-attributes="member: 12107">@rainmaker2k,hope its ok to sort of follow up on your post-appreciate to see the basis for your valuation that SHV is worth $7?with a slight margin of safety on current earnings to stay stable (say 10%), with a 50cents earnings, that puts the your valuation at 14 multiples..which is in the league of the great co&#039;s like woolies.. in fact, that&#039;s more expensive than QBE.. which can be expected to grow based on its acquisition strategy.how is SHV going to grow its earnings?.. the headwinds to its long term growth seem to include:- cyclical exposed to weather, currency risks- agriculture is capital intensive- in the commodity business.. price taker, no inflation protectionso, would seem to be a slow grower.. say 3%-5% .. ie, may be multiples of 8-12, which puts it at $4-$6?would be interested in your reasoning..cheers,</blockquote>

[QUOTE="venger, post: 550791, member: 12107"] @rainmaker2k, hope its ok to sort of follow up on your post- appreciate to see the basis for your valuation that SHV is worth $7? with a slight margin of safety on current earnings to stay stable (say 10%), with a 50cents earnings, that puts the your valuation at 14 multiples.. which is in the league of the great co's like woolies.. in fact, that's more expensive than QBE.. which can be expected to grow based on its acquisition strategy. how is SHV going to grow its earnings?.. the headwinds to its long term growth seem to include: - cyclical exposed to weather, currency risks - agriculture is capital intensive - in the commodity business.. price taker, no inflation protection so, would seem to be a slow grower.. say 3%-5% .. ie, may be multiples of 8-12, which puts it at $4-$6? would be interested in your reasoning.. cheers, [/QUOTE]

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