FlexiGroup quick out of the blocks
But market has factored in too much growth too soon.
Buying a stock that has doubled in a year and become a “market darling” is hard work for value investors. It gets even harder when the company has declining return on equity (ROE), patchy earnings per share (EPS) growth, high debt, and an aggressive growth strategy.
Based on its current valuation, the market seems to think FlexiGroup can do no wrong. The fast-growing provider of consumer and retail point-of-sale finance has done remarkably well after raising $264 million through an Initial Public Offering in 2006.
Roger Montgomery is the Founder and Chairman of Montgomery Investment Management. Roger has over three decades of experience in funds management and related activities, including equities analysis, equity and derivatives strategy, trading and stockbroking. Prior to establishing Montgomery, Roger held positions at Ord Minnett Jardine Fleming, BT (Australia) Limited and Merrill Lynch.
This post was contributed by a representative of Montgomery Investment Management Pty Limited (AFSL No. 354564). The principal purpose of this post is to provide factual information and not provide financial product advice. Additionally, the information provided is not intended to provide any recommendation or opinion about any financial product. Any commentary and statements of opinion however may contain general advice only that is prepared without taking into account your personal objectives, financial circumstances or needs. Because of this, before acting on any of the information provided, you should always consider its appropriateness in light of your personal objectives, financial circumstances and needs and should consider seeking independent advice from a financial advisor if necessary before making any decisions. This post specifically excludes personal advice.
Julian Watt
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Love this kind of analysis – seems to fit well with Skaffold. Might sign up to Skaffold if there is more of this.