Seaboard (SEB) report year-end earnings last week. They earned $234
per share for the
year. I liked their
recent consistent quarterly performance.
To me, SEB is in a very cyclical and low margin
business.
But for the last three years the company consistently earned more than $230. This gives SEB a PE of 12. I like
companies with PEs around 10 that are
consistent and boring. SEB fits the bill.
The following chart shows the company's balance sheet and earnings.
I have multiplied the PE by my ideal ratio 10.
The chart shows the market cap starting to get high relative to earnings
and net-net
— I define net-net as total current assets
minus total liabilities. I feel if it enters $3000 per share from $2800 today,
my
SEB story would have played out and I would liquidate as much as
taxes would allow. In fact, I am selling a bit here and there as I find better investments.
No comments:
Post a Comment