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ANN - ANSELL LIMITED


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Howdy ..

 

Yes I follow it. Company has had a major turnaround in it accounts and earnings over the last 6 months. Last set of accounts were fantastic despite AUD/USD hurting it and higher latex costs the company still managed a massive increase in productivity.

 

On top of all this ANN has a share buy back scheme to buy around 10% of the capital back.

Price currently at $7.45 is just out side the range they can buy so expect at worst to be supported on any dips.

 

If ANN is able to maintain the current numbers and projections the P/E of the company will be extremely low. If they are able to buy back any more shares this will only help to improve the numbers.

 

I like ANN from here. Has had some resistance at every level on the way up. Currently finding the $7.60 level hard but there seems to be a few large buyers around the $7.40/45 level.

 

If the company can keep up the numbers I would expect the price slowly to grind up.

Can only see a benifit from when they made their estimates on earnings when the currency was around 79 cents. With the Ozzie just under 72 cents I would expect them maybe to be even a touch better.

 

Company went through a very bad period for a few years but it would appear management has really got thier act together. My price target is a lot higher than the current level regardless of the direction of the overall market. The company looks as though the P/E may be under 10 in about 18 months time and with similar companies having around an 18 p/e I feel the company has a long way to go from here. That being said the market is awaiting the next set of accounts and it has been hard work the grind up to here.

 

Good luck

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Thanks Kahuna1

 

I concur with most of what you say except for management and directors who I think lack capability and ethics. Also, these Directors were in place when Repco and Pacific Brands were sold for a song and now refloated at double the selling price.

 

Given your comments, why do you think that the SP has not done anything for the last couple of years. It fluctuated between $5 and $7.20. This is only $1 and $1.50 in the old scale.

 

Aprreciate your comments

 

 

 

Avenger

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Howdy Avenger ..

 

 

Well way back in 1994 the price equiv was $30.00 for ANN. Back in 1997 we were arond the $20- mark. Obiously things went wrong. Performance between 1997 and 2002 was not stellar and in fact was dismal. Company had several offshoots that were like a black hole, debt and other worries trounced the price down to around $3.60 late 2001.

 

Since those dark days the company has manged to shed debt and get rid of businesses that were not core as well as shedding some that were marginal at best.

 

Why did the price sit so low for so long .... well it took the company so long to really get its act together. Has only just got rid of some of those marginal operations it had and I feel it has emerged fresh skinned mid to late 2003. It was even taking hits earlt that year but feel at this stage there is no more of the bad surprises we saw on a regular basis from 1997 thru early 2003. The numbers started looking very good to me around June last year and used the opportunity of the pullback Sept- Dec 2003 to buy. When a company announces such a massive buyback it seemed a dead cert that at a minimum the price would be supported. Last set of accounts were in my view stellar.

 

What we need from here is no more surprises and the numbers to look as good next half yearly.

 

Stuck round the bottom for so long as the institutions were not there at all and I cant blame them. It was one fiasco after another. Lots of blood on the street.

 

Company now focussed on core business. Yep maybe it let some of its assets go for a song but it is always the case, it is a buyers market if you know the seller is under pressure.

 

Company to me still has little institutional support partly due to fresh memories of doom and gloom and those who took a bath in the past. Suspect the higher we go the more and more buying will come from the institutional side as they are forced to have another lokk at ANN.

 

Suspect with the next half yearly we shall get another spurt on up around the $8.50/9.00 mark. Right here now the $7.60 level is too hard and I sold looking to buy on a pullback to the $7.20/30 level. At this level the company will be back with the share buyback program.

Also a small chance they actually raise the limit for the share buyback ....

 

Good luck

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Howdy ..

 

got to my target area of $7.20/$7.30 this morning. Was an easy buy at $7.23 to re establish the long position. I know it isn't much getting out at 7.57 and back in at 7.23 but this is the way the stock behaves and who am I to argue. Picking up 4 % every now and again on a stock you like that is generally trending higher just gives me more insulation should something happen to the market as a whole.

 

Good luck and watch yet again round the 7.55/7.60 level and see the strength of the sellers

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So to finish off ....

 

bought ANN at 7.23 this morning and unbelievably sold it at 7.58 this afternoon ... all this for a company I like as well as being an ASX 100 ... and not some dodgey mining stock.

 

From here look for a pullback but not as far as this mornings action. Suggest the $7.30/35

level. Danger we break thru the $7.60 level from here however if it does shall be surprised.

I think the action today was just month end games the insto's play.

 

Good luck http://www.sharescene.com/html/emoticons/laughingsmiley.gif

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Thanks Avenger

 

Not making enough to retire but trading chunks of my capital on this one. Not usuallly a day trader but was an unusual day to say the least.

 

Sorry about the break even but being honest if everything holds together in about 12 months we will be there. Obviously have a fair way to go from here but if the number hold up as I suspect they will a slow grind of about $1.00 every three months.

 

Anyhow have a great weekend

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