obiero wrote:Pierce wrote:@ pm I'm with you on that one. i can't give any evidence but like I have said here on SK before,the price is not 'reflective' of the money these guys are making.
I actually smell something fishy.
Ati today its dropping further down. MAHENI (Uongo)!!
More than a decade later, no one knows the fair price of Safaricom
The value of Safaricom depends on future growth projections - if they do well in Ethiopia, a PE of 15 and above is not unreasonable. And if they are able to grow their EPS to above Kes 2 (in the short term) because of the expansion - then any price below 30 per share is a fair price for a very solid business. Mark you the PE and EPS projections I have made are very modest.
Safaricom has for a long time traded with a PE of above 20 and who knows just how much profit could grow in the Ethiopian market. If EPS were 3 instead and PE rose back to 20, the share price would be 60. Time will tell.