HUAAN / 2739 - 2009 Q3

My TP: 0.66 (PE 10, EPS 0.066)
OSK TP: 0.87
My decison: BUY
Reason: Undervalue, metallurgical coke price at uptrend, low coal price

My study based on 2009 Q3 report (number in '000):
- ROE compare to last Q increased 4.27% to 2.47% and also higher than last year 1.09%
- Revenue compare to last Q growth 15.93% to 349834 and profit also growth 239.09% to 18470, primarily attributed to higher average price of coke; As compare to last year revenue dropped 29.6% because 37.9% reduction in the average price of coke but profit growth 57.7%, mainly attributed to the spread between the prices of metallurgical coke and that of coking coal that have widened adequately coupled with the gradually improving prices of the by-products
- Equity compare to last Q increased 1.21% to 746322, assets decreased 0.96% to 852842 and liabilities also decreased 13.87% to 106520; As compare to last year equity decreased 11.84%, assets decreased 15.56% and liabilities also decreased 34.85%
- Got FCF 5300, NCF 5300
- Profit margin compare to last Q increased 9.68% to 5.28% and also higher than last year 2.92%
- DE compare to last Q decreased 0.025 to 0.1427 and compare to last year also decreased 0.0504
- No dividend declared
- My estimate next 4Q eps after 2009 Q3 result announced = 0.0165*4 = 0.066, estimate PE on current price 0.55 = 8.33
- From date 2009-08-18 to 2009-11-13 after 2009 Q2 result announced, highest price on 2009-08-18 was 0.57 and lowest price on 2009-11-02 was 0.47
- From date 2009-05-29 to 2009-08-17 after 2009 Q1 result announced, highest price on 2009-08-13 was 0.57 and lowest price on 2009-06-23 was 0.435
- From date 2009-02-26 to 2009-05-28 after 2008 Q4 result announced, highest price on 2009-05-27 was 0.475 and lowest price on 2009-03-17 was 0.175
- http://www.eia.doe.gov/cneaf/coal/page/coalnews/coalmar.html