Summary
The fund managers believe that Boom Logistics Limited (ASX:BOL) presents a unique investment opportunity despite its historical challenges. In their opinion, the company has demonstrated strong cash flow generation, managing to pay down over $100 million in debt over the past eight years, even while reporting negative earnings. They emphasize that Boom's accounting practices, particularly around equipment depreciation, obscure its profitability. Recent management actions, including a commitment to a share buyback and strategic capital allocation, indicate alignment with shareholder interests. The fund managers note that Boom's share price is undervalued, estimating its worth at approximately $2.50, given its price-to-earnings ratio of just 8x and Net Tangible Assets of $2.83. Despite recent earnings upgrades and reduced competition, the market has yet to fully recognize this value. The fund managers anticipate that a reintroduction of dividends could positively influence investor sentiment and share price in the future.
Please note: The completeness, accuracy or current status of the investments referenced are not guaranteed.
Source: Trading View
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Commentary From The Managers
Collins St Asset Management
30 June 2025
$1.36
Summary
- Boom Logistics Limited (ASX:BOL) is a leading provider of complex lifting, moving, and project logistics solutions in Australia.
- Despite five recent upgrades to earnings, the company has struggled to gain traction in the investment community.
- Ongoing share buybacks and a reduction in competition due to a major competitor's exit have not yet improved the share price.
- Management has implemented strategies to simplify and enhance market perception of Boom Logistics.
- The company is engaged in selling under-utilised equipment to boost financial performance.
- As of 30 June, Boom traded at $1.36, with a price-to-earnings ratio of 8x and net tangible assets of $2.83.
- Collins St Asset Management expects continued consolidation in the industry, positioning Boom to benefit.
- The potential reintroduction of a consistent dividend may positively influence investor sentiment and share price.
- Based on earnings, Collins St believes BOL should trade at a blended valuation of 12x earnings and net tangible assets.
- This leads to a valuation expectation of approximately $2.50, representing an 80% premium to its share price as of 30 June.
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Please note: The completeness, accuracy or current status of the investments referenced are not guaranteed.
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Commentary From The Managers
Collins St Asset Management
30 June 2025
$1.36
Summary
- Boom Logistics Limited (ASX:BOL) is a leading provider of complex lifting, moving, and project logistics solutions in Australia.
- Despite five recent upgrades to earnings, the company has struggled to gain traction in the investment community.
- Ongoing share buybacks and a reduction in competition due to a major competitor's exit have not yet improved the share price.
- Management has implemented strategies to simplify and enhance market perception of Boom Logistics.
- The company is engaged in selling under-utilised equipment to boost financial performance.
- As of 30 June, Boom traded at $1.36, with a price-to-earnings ratio of 8x and net tangible assets of $2.83.
- Collins St Asset Management expects continued consolidation in the industry, positioning Boom to benefit.
- The potential reintroduction of a consistent dividend may positively influence investor sentiment and share price.
- Based on earnings, Collins St believes BOL should trade at a blended valuation of 12x earnings and net tangible assets.
- This leads to a valuation expectation of approximately $2.50, representing an 80% premium to its share price as of 30 June.
Collins St Asset Management
31 Dec 2024
$1.40
Summary
- Boom Logistics is actively working to close the gap between its share price and its NTA.
- Actions taken include a buy back of shares and a refresher of its assets.
- Despite these efforts, there has been no material improvement in the share price yet.
- The company has reported three consecutive earnings upgrades.
- Collins St Asset Management believes there are more earnings upgrades to come.
- Collins St Asset Management continues to hold because of the potential for future share price appreciation.
Collins St Asset Management
31 Mar 2024
$1.40
Summary
- Collins St Asset Management continues to hold shares in Boom Logistics (ASX:BOL) due to strong alignment between management and shareholders.
- The Board of Boom collectively owns over 15% of the company, reflecting their commitment.
- They have adopted a blend of capital allocation focused on enhancing fleet capabilities and overall competitiveness.
- Management is prioritizing capital expenditure (capex) aimed at acquiring better equipment.
- Any excess capital is being returned to shareholders through an on-market buy back.
Collins St Asset Management
30 Sept 2020
$1.00
Summary
- Boom Logistics offers crane and other lifting solutions for hire, including operator services and maintenance.
- Despite an abysmal earnings per share over the last 8 years, Boom has successfully paid down over $100 million in debt.
- The company generates strong free cash flows but shows negative earnings due to high initial equipment purchases.
- Depreciation of expensive equipment creates a perception of ongoing losses, despite the actual profitability of Boom.
- Management is now leasing part of its fleet due to shareholder pressure, which adds value through operational resources.
- The complex nature of the business model and accounting practices have obscured the company's value from investors.
- Collins St Asset Management believes Boom is undervalued at 10c per share, with an estimated worth of roughly 27c.
- Valuation metrics suggest a conservative target of 25c based on future cash flows.
- Engagement with management aims to ensure that the intrinsic value of Boom is reflected in the share price promptly.
Please note: The completeness, accuracy or current status of the investments referenced are not guaranteed.
Frequently Asked Questions
Who has invested in Boom Logistics Limited (ASX:BOL)?
Fund managers including Collins St Asset Management have invested in Boom Logistics Limited (ASX:BOL).
Why have investment managers invested in Boom Logistics Limited (ASX:BOL)?
Fund managers invest in Boom Logistics Limited due to its strong free cash flow generation, despite a history of negative earnings impacted by high capital expenditures on equipment. The company has successfully reduced over $100 million in debt, demonstrating financial resilience. Recent strategic shifts, including leasing equipment and aligning management interests with shareholders, signal a focus on improving competitiveness and shareholder value. With multiple earnings upgrades and an active share buyback program, fund managers believe Boom's current valuation does not reflect its true worth, estimating a potential upside of 80% based on earnings and net tangible assets. The ongoing industry consolidation and potential reintroduction of dividends further enhance its attractiveness as an investment.
What happened to Boom Logistics Limited (ASX:BOL)?
In June 2025, Collins St Asset Management highlighted Boom Logistics Limited (ASX:BOL) in their Quarterly Report, noting the company as a leading provider of complex logistics solutions across various sectors, including mining and renewables. Despite five earnings upgrades and a share buyback, Boom's share price stagnated at around $1.36 due to a lack of investor interest, even as competition waned with a major competitor's exit. The firm emphasized Boom's strategic moves to enhance market perception, such as selling under-utilized equipment and potential dividend reintroduction, which could positively affect investor sentiment. With a current price-to-earnings ratio of 8x and net tangible assets of $2.83, Collins St believes Boom should be valued at approximately $2.50, reflecting an 80% premium, as the industry continues to consolidate.