Great article. How are you thinking about exit given where share price is at? I'm a fellow shareholder FYI, entered at 640p (avg price) and now trying to wrap my head around current valuation and whether if its time to sell at 1800p. It's still unexpensive relative to peers at around c.10k / mature ha but is there enough juice left on this one? even it it goes to 11k we're looking at c.8% uplift on share price, which just isnt as asymmetric anymore...
In my article, I estimated that by Dec-25 AEP would have ~£223M in cash, vs their current market cap of £692M, and would earn about £76M in 2026, and so would end the year with about £270M in cash after dividends and buybacks. At the current price, this is a P/E of 692/74 =9.3x, and if we adjust for the cash, (692-223) = £469M/£76M =6.2x. An unexpected event which is not accounted for by these numbers, is that the CPO price has recently spiked from about $1300/tonne pre-Iran war, to $1550 currently, and also the Indonesian government has announced the move to 50% biodiesel blend. Therefore, I continue to hold. I will attend the AEP AGM in June 2026 in London, and will be asking the directors to put the cash pile to work, as described in my article. Great to hear that you got in at 640p: a similar price to when I started buying, though my average is higher than this. Additionally, in a world of high government debt (causing future inflationary pressures), and volatile oil prices, AEP is a good hedge in my portfolio against these things. Re: future upside, which your question concerns, this is hard to quantify. Clearly, the cash on hand is not being valued by the market, so this is a source of potential upside.
Great article. How are you thinking about exit given where share price is at? I'm a fellow shareholder FYI, entered at 640p (avg price) and now trying to wrap my head around current valuation and whether if its time to sell at 1800p. It's still unexpensive relative to peers at around c.10k / mature ha but is there enough juice left on this one? even it it goes to 11k we're looking at c.8% uplift on share price, which just isnt as asymmetric anymore...
In my article, I estimated that by Dec-25 AEP would have ~£223M in cash, vs their current market cap of £692M, and would earn about £76M in 2026, and so would end the year with about £270M in cash after dividends and buybacks. At the current price, this is a P/E of 692/74 =9.3x, and if we adjust for the cash, (692-223) = £469M/£76M =6.2x. An unexpected event which is not accounted for by these numbers, is that the CPO price has recently spiked from about $1300/tonne pre-Iran war, to $1550 currently, and also the Indonesian government has announced the move to 50% biodiesel blend. Therefore, I continue to hold. I will attend the AEP AGM in June 2026 in London, and will be asking the directors to put the cash pile to work, as described in my article. Great to hear that you got in at 640p: a similar price to when I started buying, though my average is higher than this. Additionally, in a world of high government debt (causing future inflationary pressures), and volatile oil prices, AEP is a good hedge in my portfolio against these things. Re: future upside, which your question concerns, this is hard to quantify. Clearly, the cash on hand is not being valued by the market, so this is a source of potential upside.