Don't think the discount to book value means much when there is so much overcapacity right now (what use is the book value of a mill if there are too many mills in the world? Doubt they'd be able to realise book value on that equipment in this market).
As Deutche mentions via newratings.com the dividend seems unlikely to be maintained for the next two years due to weak cash generation. The high dividend yield was the main reason I was attracted to the stock.
MNP traded at R17.80 today, 40% down from when I bought in in December (and when I thought it was screamingly cheap). I don't think one needs much of a turnaround in the environment to get this share back to R40.00. So the question is whether I should buy today or wait a bit?
I'm waiting....
No comments:
Post a Comment