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slyestjester

08/12/12 2:15 PM

#15620 RE: treit2002 #15604

Just saying that SIAF does not immediately make much of a return on its investments as it requires time for the stock, whether plant or animal, to reach maturity. And as maturity is reached in many cases it is simultaneously getting a larger proportional ownership of the enterprise. This leads to escalating ROE/ROA. In the next 12 mos if they make .90 they will achieve slightly less than 50% ROE. If they make anything more than 1.30 in the subsequent 12 mos. the ROE will be higher during that period. If they double earnings during that period (as was indicated at the recent Sweden meetings as the minimal case), ROE would be 65% or so. Not sure how high it can go, but if they get a 30% ROA, that is basically unheard of in the business world for any sustained period. That's what a chip co. makes when it comes out with the latest, everyone-must-have product, and it sustains that level for a year and is frequently bankrupt and out of business a few yrs later.