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High Quality Business and a true compounding machine

EM
emndyInvested
Community Contributor

Published

October 10 2024

Updated

October 10 2024

Narratives are currently in beta

PRESCO operates in Oil Palm sector which has high entry cost and long gestation period.

PRESCO has high margins (Gross & Net) and pricing power with specialized products including RBDO. Strong enough MOAT - competitive advantage inorder to protect and sustain the high ROCE for a long time

PRESCO has quality earnings. High cash generating capacity, High FCF margin and FCF/Net income Ratio

PRESCO has High ROCE, Fair payout ratio with growth opportunity to allow compounding the retained earnings. Has a lot of unplanted areas. Capacity and history of expansion organically and inorganically.

Owner operators, good management with proven track record

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Disclaimer

The user emndy has a position in NGSE:PRESCO. Simply Wall St has no position in any of the companies mentioned. The author of this narrative is not affiliated with, nor authorised by Simply Wall St as a sub-authorised representative. This narrative is general in nature and explores scenarios and estimates created by the author. The narrative does not reflect the opinions of Simply Wall St, and the views expressed are the opinion of the author alone, acting on their own behalf. These scenarios are not indicative of the company's future performance and are exploratory in the ideas they cover. The fair value estimates are estimations only, and does not constitute a recommendation to buy or sell any stock, and they do not take account of your objectives, or your financial situation. Note that the author's analysis may not factor in the latest price-sensitive company announcements or qualitative material.

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Fair Value
₦1.2k
52.3% undervalued intrinsic discount
emndy's Fair Value
Future estimation in
PastFuture01t20132016201920222024202520282029Revenue ₦1.1tEarnings ₦432.4b
% p.a.
Decrease
Increase
Current revenue growth rate
31.76%
Food revenue growth rate
1.18%