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CPI heading for R400

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SimonPB
Valued Contributor
ya so that's crazy talk .. but here's why it could .. current PE is 18, so lets say over the next three years of the new bull/bubble it can get to be very expensive at a PE of 36 .. that gives a prive of R200 .. then lets say over that same period they double earnings (that requires annual growth of only 24%) .. then we get to R400 ??

madness, but heck not nearly as mad as some of the prices I seen on the JSE over the decades ..

AND MAX NB, this is not a tip, nor investment advice .. just a throw away comment from a Q I was asked last night about where CPI could go to and why I wasn't selling ..
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12 REPLIES 12
Werner_1
Super Contributor
lol. that sounds very interesting, i bought this share some years ago with the idea that it offered good value, well, for me it truely made some excellent value over that time. I actually told some guys in december 2008 that CPI looked good, they told me that the other banks offered better returns and lower risk profile... well, we know what happenened... As far as i can see it, the business is running very well, has a good management team and I can see growth continuing for the next few years, there is lots of potential... Simon, I have to agree with you on CPI - i really like it, only problem is I should have bought more shares. haha...
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Not applicable
And I should have bought shares! i keep looking at this one wondering when I will get a chance to get in (for long term), since it doesn't fit any of my valuation criteria for long term purchases.
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Werner_1
Super Contributor
Its also off my analysis now, but it was on some time ago. I wouldnt easily buy at these levels, i think its risky... but will not sell now either...
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striker
Super Contributor
Much like NPN this stock needs a huge leap of faith in it's performance going forward.Price too hot for me.
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SimonPB
Valued Contributor
ya, but it depends on ones personal investment strategy .. if lookign for cheap then CPI is not on your list .. but for puure momentum and the buy high sell higher .. well then who know's ..
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Werner_1
Super Contributor
exactly... while the bulls drive it up, there might not be much better place to go... just check out its motoring in the last few days... but its not cheap... i am happy i got when nobody liked them and they were cheap.
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striker
Super Contributor
Lot's of small trades driving the price,which could mean small players or manipulation -merely an observation.
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Werner_1
Super Contributor
I get the idea that too many people look at investing by only looking at the share price... have any of you guys really studied the CPI business and read through the annual reports, etc? Simon, i know you did... maybe small trades, etc. but PSG owns a huge amount of the shares, removing liquidity but giving a vote of confidence because who wants to invest so much in a ***** business and Jannie Mouton is known for making good decisions. Obviously the price is the key to entering, thats why i only buy when price is good for me and company excellent!
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SimonPB
Valued Contributor
if small tardes are manapulation, then all my clients are crooks ?? surelu the lower liquidity means even the big guys have to do small tardes .. if you wanna put R10m into CPI, you have to do it slowly over time .. and for asset managers R10m is small ..
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striker
Super Contributor
Whatever,Simon whatever.
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Werner_1
Super Contributor
Simon, you made me laugh now... i really liked that comment... but its true...
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SimonPB
Valued Contributor
striker .. sure, but this manipulation wives tale gets hauled out all the time on this forum, and frankly tis pish tosh ..
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