RE:Net Earnings nearly double in 20162j3kl wrote: Consensus in Canadian dollars is for $5.40 in 2015.
Consensus also in cad is for $9.50 for 2016.
Concordia traded at 20 times earnings in 2015.
Once this sector settles down from the recent short and distort attacks, a return to normal ratings seens inevitable.
Afterall, what other sector can offer these earnings gains.
True, this sector is cheap compared to other sectors, but I can't imagine returning to a 20x multiple any time soon. CXR probably quickly returns to a 10-12x multiple after the results are out in 2 weeks, and then might gradually climb back to a 12-14x multiple over the following year.
Of course, with 2016 earnings nearly doubling 2015 earnings, this multiple expansion PLUS earnings growth will have CXR on a very strong up trend for the next 12 months.
No matter what happens with VRX next week, the run back up in CXR is almost inevitable.
10x 2015 = $54.00
12x 2015 = $64.80
12x 2016 = $114.00
14x 2016 = $133.00
Getting back to a 20x multiple would be amazing, but unlikely until this sector attack is well behind us. 2 years or so should do it.