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BBB, B DIGITAL LIMITED
duno
post Posted: Sep 25 2006, 10:36 AM
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takeover offer of 16c a share by SOT. sounds good to me.

 
datum
post Posted: Sep 22 2006, 11:00 PM
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BROKER NEWS - 21/09/2006

BBB - ABN Amro rates the stock as Hold - Target $0.12 (was $0.15)
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The company reported a loss of around $67m compared to the broker's forecast of a small profit thanks to a major write-down, though it points out at least cashflows were reasonable.
Given the disappointing result and tough conditions in the company's markets the broker has cut its forecasts, with its profit estimate in FY07 down 5.6% to $16.1m and in FY08 by 9% to $17.6m.

Valuation falls to $0.18 from $0.19.


Target price is $0.12.Current Price is $0.10. Difference: $0.02 - (brackets indicate current price is over target). If BBB meets the ABN Amro target it will return approximately 20% (excluding dividends, fees and charges - negative figures indicate an expected loss).


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This is not a bottom draw stock. This is a stock you take to the grave with you.
 
ousia
post Posted: Sep 20 2006, 05:53 PM
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QUOTE (ousia @ Monday 21/08/06 06:33pm)

Well, I didn't see the massive $65mill Kooee writedown coming. Without this big one-off item, my earlier NPAT forecast would have been pretty accurate.

What I did manage to predict accurately is that, excluding one-off items, underlaying earnings and cash flow remain solid.

Normalised earnings remain at $21mill. Assuming there are no big write-downs in FY07, if this level of earnings is maintained over 07, investors could reasonably expect the company to post a 07 NPAT in the region of $15mill.

Will normalised earnings in the region of $21mill be maintained in 07?? Margin pressure for mobile products going forward is likely to be more than offset by improved margins (and substantially increased sales) for broadband products.

Confirming what I said earlier, the wholesale market is improving.

Cash generated from operations over 06 was a very healthy $21mill.

Since June, SPTComm has finally starting to generate after tax profits.

Despite these positives, there was a bit of a sell-off today is traders focused on the headline number ($68mill loss). However, more savvy investors (who know how to read a balance sheet), will see that BBB have taken the oportunity in FY06 to write down and expense as much as possible. By cleaning up the balance sheet this FY, BBB management have put in place a solid foundation for a return to profitability in FY07 and beyond.

 
rubba81
post Posted: Sep 16 2006, 06:32 PM
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looks like it is finally starting to break its downtrend, not much downside risk.

 
ousia
post Posted: Aug 21 2006, 06:33 PM
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In reply to: ousia on Monday 12/06/06 12:11am

Just had a look at my post from June. I predicted then that the stock would hit 14-15c in July. The stock hit 12.5c from memory, so my prediction was close. I also predicted in June that FY07 earnings of $18-20mill. While I continue to think these figures are realistic, I now feel more comfortable with a FY07 NPAT forecast of $15mill. I maintain my June forecast that FY07 NPAT will come in at between $1mill and $4mill, largely on the back of one-off items.

 
ousia
post Posted: Aug 21 2006, 06:24 PM
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BBB continues to look significantly undervalued to me, and is ripe for a re-rating. There are number of positive issues which, in my view, have yet to be reflected in the share price. First, the ACCC is finally putting the screws on Telstra, forcing a reduction in the ULL rate, which should assist BBB's margins going forward. Second, in a few weeks, BBB is due to release its residential voice over broadband product. Voice over internet/broadband products are also expected to generate healthy margins. If BBB moves quickly and aggressively on this front, then we may see some important margin improvement in 07. Third, BBB's decline in after tax profit for FY06 (which largely explains the SP decline over the last 12 months) was due in large part to one-off items (mostly relating to B shop). I suspect that, following the release of the 06 full year results, the market will start to believe that the 06 write downs really were just one-off and begin to value BBB on the basis of normalised earnings again. Fourth, and finally, BBB's parent (SOT) could make an offer at any time to minority shareholders for the remainder of BBB.

With a market cap of just $75mill, and with the realistic possibility that the company will generate an after tax profit in FY07 of $15mill+, BBB is currently my top pick within the telco sector. (Assuming a conservative p/e multiple of 10, BBB looks to me to be heading for a SP in the region of 18-20c over the next 12 months). The key risk to this projection is BBB's ability to maintain market share in the highly competitive mobile market.

Full disclosure: I have a large holding, for which I paid 8c.

 


freoman
post Posted: Jun 28 2006, 10:26 AM
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huge volumes this morn,who bought the 8000000 parcel could it be sop ????

 
freoman
post Posted: Jun 20 2006, 02:50 PM
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In reply to: freoman on Tuesday 20/06/06 10:55am

up 23% so far biggrin.gif

 
freoman
post Posted: Jun 20 2006, 11:55 AM
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In reply to: buffett on Sunday 18/06/06 11:57am

looks like bbb is finally on the move great value at the moment biggrin.gif

 
buffett
post Posted: Jun 18 2006, 12:57 PM
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In reply to: ousia on Monday 12/06/06 12:11am

Tom,
Always enjoy your posts particularly on ADA. Think you could be generous giving a PER of 10 in this industry at the moment & also not sure all losses are totally finished with in the second half year in relation to B shops. SOT have no reason to push profitability if they eventually aim to take it over (several common directors) may be happy to wait before making a move. Would be interested in your views on what competitive advantages BBB hold in this very competitive market going forward. If they have no competitive advantage going forward they are going to continual to operate in a falling margins contacting revenue scenario along with many other small telcos because VOIP technology must surely slash future revenues & encourage more churn within the industry. BBB market cap is significantly higher than the likes of PEO around $22m.. I get the impression this industry only talks about revenue & EBITDA never after tax profits. I suspect the association with SOT does bring higher quality management to the business. Would appreciate one of your "ADA dissection style" posts on BBB.
Regards
Buffett

 
 


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