Please Note: Blog posts are not selected, edited or screened by Seeking Alpha editors.

Shine Corporate

Interesting situation in Australia:

- Listed Law Firm Shine Corporate Ltd halves their profit forecast.

- Stock down by 70%.

- P/E ratio at distressed level. 10% Cash flow yield for a relatively resilient business.

- Significant value opportunity at AUD0.56, assuming there is no more additional unexpected writedown and no additional hit on the back of early investors suits.

- Interesting asymmetric gain potential vs. risk of loss

Main risks:

- Unfavorable outcome of the E&Y accounting review and additional writedown.

- Fines and suits from early investors.

- Senior lawyers leaving to save their reputation and bringing business to other Law Firms.

Disclosure: I/we have no positions in any stocks mentioned, but may initiate a long position in SJH over the next 72 hours.