Valuation
To arrive at a valuation for Seprod, we utilized a relative Price-to-Earnings (P/E) approach. We estimated YoY net profit growth of 46.02% for 2023, largely representing the total impact of the AS Bryden acquisition, alongside increased growth from exports and achieved synergies. Against this backdrop, we ultimately arrived at a forecast for net profit for 2023 of $4.3 billion. This is commensurate with an EPS estimate of $5.88. We’ve utilized the average P/E of comparable listed companies to arrive at a multiple of 13.27x, which was applied to our EPS forecast. Utilizing this multiple resulted in a target price of $77.99, representing a potential upside of 21.01% and a total return of 23.47%. In light of this fair value estimate, alongside the aforementioned in the report, we recommend investors OVERWEIGHT Seprod.
| Stock | Seprod |
|---|---|
| Current Price | J$64.45 |
| Dividend Yield | J$2.45% |
| YTD | -9.23% |
| Estimate Fair Value | $J 77.99 |
| Potential Return | -17.99% |
| Trailing P\E | 16.01x |
| Trailing P\B | 1.68x |
| Forward P/E | 10.96x |
| Dividend Yield (TTM) | 2.00% |
| Potential Return | 21.01% |
| Total Return Recommendation | 23.47% |
| Recommendation | UNDERWEIGHT |
as at April 18, 2023
Seprod Limited | Equity Analysis
