Would Peter Lynch Buy SMRT? | The Motley Fool:
Recently, SMRT pointed to continuing efforts to drive higher productivity. There is room for improvement. Currently, its Asset Turnover, which measures the amount of sales generated for every dollar of asset employed in the business, is 0.6. By comparison, ComfortDelGro (SGX: C52) boasts an Asset Turnover of almost 0.8 and SBS Tr5ansit (SGX: S61) generates a whopping $0.90 for every $1 of asset employed. Admittedly we are not comparing like with like, but it provides a pointer to what could be achieved.
Another financial ratio that might interest Peter Lynch is net cash or in this case, net debt. SMRT has debts of S$628m and cash of S$128m, which leaves it with a net debt of S$500. I can almost see the frown of disapproval on Peter Lynch’s face.
SMRT has a lot of work ahead of it. But until it can charge passengers a realistic fare for using its services, I suspect even Peter Lynch might wait patiently on the platform for the next available train to come along.
'via Blog this'
Recently, SMRT pointed to continuing efforts to drive higher productivity. There is room for improvement. Currently, its Asset Turnover, which measures the amount of sales generated for every dollar of asset employed in the business, is 0.6. By comparison, ComfortDelGro (SGX: C52) boasts an Asset Turnover of almost 0.8 and SBS Tr5ansit (SGX: S61) generates a whopping $0.90 for every $1 of asset employed. Admittedly we are not comparing like with like, but it provides a pointer to what could be achieved.
Another financial ratio that might interest Peter Lynch is net cash or in this case, net debt. SMRT has debts of S$628m and cash of S$128m, which leaves it with a net debt of S$500. I can almost see the frown of disapproval on Peter Lynch’s face.
SMRT has a lot of work ahead of it. But until it can charge passengers a realistic fare for using its services, I suspect even Peter Lynch might wait patiently on the platform for the next available train to come along.
'via Blog this'
No comments:
Post a Comment