06-Jan-2024: Not a valuation, but a target price. I think they'll get up towards $7 on the back of increased work, so increased revenue and profits, but they might not push through $7 immediately, it might take a few goes and a couple of good reports for that to happen, so for now I'm happy with 7 cents below $7. Longer term, I think they're going to at least $8/share.

I recently added JLG to my largest real money portfolio based on increased work from the flooding and storms we've seen along Australia's east coast in recent weeks.

I also noted during last year (2023) that they had work along some of the worst flood-affected sections of the River Murray in SA, and I shared photos here of their signage around what little there was left of the Blanchetown Caravan Park, including this one:

So I believe they are managing to pick up natural disaster work all over Australia now.

One of the concerns that analysts had 18 months ago was that JLG might have some trouble penetrating the US market based on the significant moats they enjoy here in Australia, i.e. their relationships with insurers and their positive reputation, attributes that the incumbant players in the US would likely already enjoy. The argument was that the very things that they enjoy here in Australia that make it difficult for people to take significant market share off them here are likely to be the same roadblocks or hurdles they are likely to face over there as new entrants into an established market.

Well, they seem to be making solid progress over in the USA, as the following two slides from their JLG-FY23-FY-Results-August-2023.pdf (FY23 Full Year Results Presentation in August 2023) show:

While I'm looking at that presentation, here are their FY23 highlights, and their FY24 guidance:

Note there that they have Zero Net Debt, $72m in Net cash, plus an undrawn $80m loan facility. They have also made some bolt-on acquisitions, so they are growing both organically and via acquisitions.

JLG refer a lot to CAT events, meaning catastrophe events, generally weather-related catastophic events. They don't forecast revenue from events that have not yet occurred, only from ones that have already occurred, with examples given above, so there is always revenue upside from ones that will occur in the future, as shown at the bottom right of their FY24 Forecast slide, 4 slides below.

If you can't read the bottom right corner of that slide - here it is blown up:

And here is a snapshot of some of their clients:

And here's what their share price has done over the past three years:

Apologies for that amateurish attempt at TA - it's not my area of expertise.

So, yeah, I hold JLG now, having bought some a few weeks ago (in December 2023) and I'm more bullish on them, at least in the short to medium term, than I was previously.

07-Jan-2024: Small Edit - I had put 2023 instead of 2024 at the very top of this one - have changed it now to the correct year - 2024.