##{"id":60607,"date":"2012-09-21T10:10:19","date_gmt":"2012-09-21T00:10:19","guid":{"rendered":"http:\/\/www.fnarena.com\/index.php\/2012\/09\/21\/switzer-super-report-im-buying-this-company-because\/"},"modified":"2012-09-21T10:10:19","modified_gmt":"2012-09-21T00:10:19","slug":"switzer-super-report-im-buying-this-company-because","status":"publish","type":"post","link":"https:\/\/staging.fnarena.com\/index.php\/2012\/09\/21\/switzer-super-report-im-buying-this-company-because\/","title":{"rendered":"Switzer Super Report: I\u2019m Buying This Company Because\u2026"},"content":{"rendered":"

\n\tBy Peter Switzer, Switzer Super Report<\/a><\/p>\n

\n\tYou all have been asking me for a long time now to share my own views on stocks that I like and at the same time explain the underlying reasons why I think the selected share is a goer. Today marks my capitulation to these requests and the first company I put forward is really outside the kinds of companies I generally invest in – it’s called Audrill<\/span> Limited ((ASL<\/span>)).<\/p>\n

\n\tThis week I interviewed the company’s chief financial officer, Jose Martins, for my SWITZER program on the Sky News Business channel, and I was really impressed with the guy.<\/p>\n

\n\tAbout Ausdrill<\/strong><\/p>\n

\n\tAusdrill is a mining services group that has lifted its net profit by 53% in the past year. Net profit after tax was $112.2 million – a record high – and for the first time, its revenue went over a billion dollars. That was a 25% gain.<\/p>\n

\n\tThe company works worldwide and has customers such as BHP Billiton ((BHP)) and Newmont. I like the fact that it gets around 60% of its revenue from the gold industry and with all of this QE3-style monetary expansion around the world, some experts think gold is going to soar to US$2,400 an ounce. Leave me out of those predictions, but I do think gold is going up.<\/p>\n

\n\tNow, you could be asking why would I go for a drilling company with mining slowing? It’s a good question. But exploration drilling only accounts for 11% of the company’s revenue, with last year’s growth driven by drilling for miners that were producing. Jose Martins expects the company’s revenue to grow by 15% this year.<\/p>\n

\n\tThe company’s last share price was at $3.04 – a record – and its dividend last year was 14.5 cents fully-franked. That’s a dividend return of around 4.7%.<\/p>\n

\n\tIt’s not just me<\/strong><\/p>\n

\n\tRudi Filapek-Vandyck of FNArena tells me that in his broker review, five stockbrokers rate Ausdrill a “Buy”, one says “Sell” and one is neutral. Gary Stone of Share Wealth Systems, whose analysis I respect, called Ausdrill one of his 16 gold medal stocks and he likes the fundamentals on it going forward.<\/p>\n

\n\t“Ausdrill<\/span> has continued to increase or maintain its dividend payout since June 2002 from 1.5c to 14.5c giving a current dividend yield of 4.8% and a long-term annual DPS (dividend per shares) compounded growth of 25.5%,” he pointed out.<\/p>\n

\n\tShare price growth over this time has been ten-fold from 30 cents to $3 – that’s an annual compounded growth rate of 26%.<\/p>\n