Over the past few years, we have consistently recommended Aveng (AEG) as an opportunity. Those who have followed our advice have more than doubled their money.
By the start of 2022, the company had substantially reduced itsand completed a 500-for-1 . These two events have returned the from being a marginal to being a solid with good prospects. At this stage the company earns two-thirds of its in Australia from its subsidiary McConnel Douglas – which makes it a . In South Africa it has been benefiting from the increased of companies as a result of the in prices.
In its most recentfor the year to 30th June 2021, the reported (HEPS) of 2c – which translates to R10 per share after the consolidation. At its current price of R28.33, this puts the company on a (P:E) multiple of just 2,83 – which is extraordinarily for a profitable business of this sort which has a of over R20bn per annum.
It has just completed itsperiod for the six months to 31st December 2021 and will probably report in February or March 2022. In the meantime, can look forward to a at some point in the next month or so which will give an indication of where the company expects its HEPS for the interim period to be.
In the meantime, it is worth watching the share’sand to see if there is any of the share going on ahead of the . Consider the chart:
This chart shows the progress of the share since the consolidation on 7th December 2021. The top chart is a standard; the middle chart is an (OBV) chart; and the bottom chart is a volume histogram.
The OBV shows that the share is being steadily accumulated by the “”. A lot of this is probably institutional buying as the return from their Christmas holidays and realise just how cheap this company really is. Overseas banks like JP Morgan, which now owns 22,45% and Bank of America which now owns 9,64% have been buying as much as they can lay their hands on. They are certainly alive to the fact that, at these prices, Aveng represents a screaming bargain.
So, once again, we suggest that you could do worse than add this share to your. If you already hold it, our recommendation is that you keep it and perhaps even add to your holding.
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