Buy British Polythene Industries (BPI) by Paul Hill in MoneyWeek CLOSED
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Performance
173.61%
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Price at start
360.00p
(mid)
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Price at close
985.00p
(mid)
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Tip made
13/04/2012
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Tip Status
Closed
13/04/2015
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Tip Notes
The company is bidding on three out of nine prisons that are being privatised, along with the tendering for probation services in a joint venture with Durham Tees Valley Probation Trust. The city is forecasting 2012 revenue and underlying EPS of £2.3bn and 44.7p respectively, with a 5.5% dividend yield (twice covered). I rate the stock on a through-the-cycle ENITA multiple of eight, assuming a sustainable profit margin on 4%. After adjusting for the £56, pension deficit and £44m of net debt (0.7 x EBITA), I get an intrinsic worth of about 410p per share.\\nPaul Hill - MoneyweekTip Research
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