Yahooligans:
It's a little tough to value
KSU becuse its Stilwell (Janus) assets are so
uniquely attractive.
Post split-off, Stilwell will
be the largest, fastest growing and most profitable
mutual fund company in the world.
Second best
might be T. Rowe Price and Associates (TROW). I like
TROW a lot, and believe its P/E of 17.5:1 next year's
earnings is easily justified. TROW is more profitable than
almost all high-tech companies, and carries none of
their obsolescence risk.
However, I like KSU
much, much more than TROW.
At 17.5 next year's
EPS consensus of $5.94, Stilwell's mutual fund assets
are worth $103.95 on a pre-split basis. Today, the
DST stake is worth more than $14 per KSU share, and
the railroad should be worth roughly $7 per
share.
Add it all up, and KSU is worth at least $124.95.
That is today's value, and that number is growing 15%
per year, minimum.
These numbers give
credibility to the contention that KSU is a screaming buy at
77 11/16.
Choose your valuation method. KSU
is cheap, and going up--a lot. Based on this week's
price action, the market seems to be catching on to the
fact that KSU is worth a lot more than the current
price.
I'm buying more on Monday.
Best
wishes,
Mark Hirschey