COMPANY COMMENT: Valuations of Advtech and Curro are a bit of a riddle
The big question then remains: is Curro’s share price too high or Advtech’s too low?
Some earnings numbers are more valuable in the market than others. For instance, the 50c a share earned by a fast-growing fintech counter versus the 50c a share earned by an old smokestack textile manufacturer.The way the market values earnings by companies in the same sector can differ — take perennially profitable Afrimat versus other less consistent construction-aligned counters. But why there is such a huge differential in the market rating between listed private education specialists Advtech and Curro is a bit of a mystery. On Tuesday, Curro announced headline earnings of about 27c a share for the half-year to end-June, and on Monday, Advtech said that it should post headline earnings of between 38c and 39c per share for the same period. If we presume growth rates will continue into the second half, then Curro is trading off a forward earnings multiple of about 78 times. Advtech has a far more modest earnings multiple of about 21 times. If we turn this around and imagine that A...
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.
Subscribe now to unlock this article.
Support BusinessLIVE’s award-winning journalism for R129 per month (digital access only).
There’s never been a more important time to support independent journalism in SA. Our subscription packages now offer an ad-free experience for readers.
Cancel anytime.
Questions? Email helpdesk@businesslive.co.za or call 0860 52 52 00. Got a subscription voucher? Redeem it now.