KME - Kip McGrath - Aussie Stock Forums

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  1. #1

    Default KME - Kip McGrath

    In keeping with the theme that Education will be one of the key industries of the future I came across a stock called KME and would like to get more opinions on this.

    - Started in Oz as a kindy to 16 tutoring business
    - The business is a franchise model. I.e. the McDonalds of tutoring businesses
    - Expanded to UK and now makes more $$in UK than it does here

    It recently embarked on two new products. (1) English classes for non-english speakers (2) Pre-university courses. And is now expanding into the South East asia.

    I quite like the story and have entered into a small position. The price has given away a little somewhat however.

    Do you guys think this stock has the legs to run further?
    Last edited by hueyt; 20th-February-2007 at 08:58 PM.

  2. #2

    Default Re: KME - Kip McGrath

    I liked the story and got in recently too with a small holding. I hope you have hung on because IMO this stock is going to show good growth. Look at current depth - lots of buyers and not many sellers.

    I have done a bit of research and like the forecast EPS. $26M cap and IMO this stock is undervalued, it had a few problems a while back when it started buying and running its own centres - management saw the error of their ways and sold them and back to what they do best. Big plans unfolding to expand into a lot of new markets. Stable and solid management and a great product.

    -MD Presentation at AGM Oct 2006-
    "We were very pleased that the company continued to increase its number of
    franchises during the year from 584 to 648.
    As our income is essentially an annuity income once a franchise is sold, the
    more franchises we have the greater the companyís continuing income.

    We have centres in 20 countries. Only Australia, New Zealand, Samoa and
    Fiji are full or almost full. UK with 253 centres is half full.
    In the USA we havenít begun to fulfil the potential. In the countries where we
    have a presence there is a market for 1000ís more centres. Then there are
    another 100 countries where we could open centres.
    This potential is the reason we spend a good part of our income in further
    development of curriculum and expanding into these markets. Without this
    expenditure to create growth for our future our profits could be much higher.
    However, it is our belief that when the future has as much potential as our
    future does, we should be investing to see it fulfilled."

    Interested to hear what anyone else thinks.

  3. #3

    Default KME

    Does anyone have a view on KME, specially after its recent announcement regarding the purchase IOTA a higher education provider.


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