5% RBD purchased.

[hiawatha]

I see from SSH announcement that some-one called James & Jean Douglas Trust from USA just purchased 5% of RBD. Do they know something we don't or are they just speculators?
hiawatha

THE KING says that James & Jean where very smart use USA$ to BUY NZ$ cheap STOCK US terms $$$... [^][^][^]

[Snoopy]

quote:Originally posted by hiawatha

I see from SSH announcement that some-one called James & Jean Douglas Trust from USA just purchased 5% of RBD. Do they know something we don't or are they just speculators?
hiawatha


You've been found out Hiawatha, with too much sleeping in the shadow of your totem pole tucked up in your teepee.

RBD must be the most consistantly over reported company ever to appear on sharetrader, so it is rather surprising that you 'missed' any developments.

RBD has been available on a yield of 11-12% (the best available) not for days or weeks or months but *years*. You would have to be deceased inside a hermetically sealed coffin not to notice. Now while that yield is pretty good for New Zealand investors it must seem unbelievably amazing to US investors.

What would you 'all do? Put your money in a bank account and earn 2%, or put it into a vehicle that yields 11%+ with the possibility of capital gain as the US dollar depreciates even if the share price does nothing? It really is a no brainer. And of course if you are a US citizen you would be very aware of the KFC/Pizza Hutt/Starbucks franchises that make up RBD, which would give you confidence in the business model. I find it rather surprising that more American's aren't invested in RBD.

Of course you have the announcement of DominosPizza going nationwide, which is apparently an 'increase in competition'. However Dominos are achieving this by taking out Pizza Haven, so the truth is quite the opposite of the headlines. Competition is actually *decreasing* for Pizza Hutt with the amalgamation of the number two and three nationwide players. Then we have the emergence of 'Hell Pizza' and other regional players still there to give the PH/Dominos duopoly a hard time. But all these guys are still market minnows compared to the big two. Competition to be watched, to be sure, but not yet feared.

Sales are looking up at PH Victoria and Starbucks. KFC is holding its own. Cashflow is good. Debt is low.

Then we have the technical analysis side of things that is so popular on this forum. The RBD share has been in an uptrend for the last few months on rising volume.

I mean how many more signals that this is a good investment do you need? Short of compiling all the information available into a book and bashing you over the head with it, I'm not sure what more one beagle could do!

I am bemused that you could think to call an investment based on market power, detailed knowledge of the business model, high sustainable dividend yield and low downside risk 'speculating'. It is the antithesis of 'undertaking risky investments in the hope of making a large profit'.

SNOOPY

discl: hold RBD

[duncan macgregor]

SNOOPY, I know i did promise not to have you on with this doggy again, but i weakened sorry. The sp in dec 2002 was the same as it is now so two years of frustration and nil return other than a dividend. WOOPEY DOO its been a bull market since then a monkey and a dart made 25pc last year. The future of RBD looks bleaker than it did two years ago. Thats what makes the market i suppose people that hold dogs like this in a bull market. I understand if times were bad, and dividends were what counted then there might be a half excuse to have a dog like this but right now it is like their food YUCK. cheers your old mate macdunk

[Snoopy]

quote:Originally posted by duncan macgregor

The sp in dec 2002 was the same as it is now so two years of frustration and nil return other than a dividend. WOOPEY DOO its been a bull market since then a monkey and a dart made 25pc last year. The future of RBD looks bleaker than it did two years ago. Thats what makes the market i suppose people that hold dogs like this in a bull market. I understand if times were bad, and dividends were what counted then there might be a half excuse to have a dog like this but right now it is like their food YUCK. cheers your old mate macdunk


Macdunk, I note your emphasis 'nil return other than the dividend'. I might as well say your NOG has made 'a nil return other than the capital gain'. You must add the capital gain to the dividend to get your total return! In the case of RBD that is in round figures 12%, per year, not something that is insignificant.

You are correct that RBD share price has gone nowhere over the last two years, but of course there was no way to know that with certainty *in advance*. Anyway it is still possible to do rather well out of a share like this when the price goes 'nowhere', as I shall explain.

During 2003 and 2004 I increased the number of RBD share I held by 19% (bought at $1.25) and 48% (bought at $1.26) respectively, a total increase of my holding size by 75%. If you look at the total number of shares I now own, these 'new' shares represent 43% of the total.
I have made a gain of 8c per share on these new shares over the last two years that. That represents a capital gain of

8c x 43/100= 3.5c

3.5c over *all* of my RBD shares (because obviously my 'new' shares are now indistinguishable form my 'old' shares) or 1.75c per share per year. That figure is of course 'tax free' because I am not a trader.
It represents an equivalent gross income of 2.65cps (based on 33% tax rate.) Or if we add back in the dividend of 10cps (net)/15cps (gross) that makes a yield of 17.65/1.33= 13.3% pa gross (based on todays closing price) or 17.65/1.26= 14% pa based on my most recent buy price of $1.26.

These returns are 'brokerage free', so for someone to trade shares and beat me (like you try to do) I should probably add on another percent to make up for the buying and selling brokerage (to make up for the one trade in two years that I didn't do) that I didn't pay. That brings my return up to a 'traders equivalent' of 14.3%-15%.

Now I am well aware the index, particularly last year, did better than this (which is what I would generally expect with income shares in bull market). I am well aware that by holding other shares I could have done better than this.

Well guess what? I *did* hold other shares and they *did* do better than this! This 14-15% pa performance was was the worst thing that happened to me on the NZ market over the last two years. This was my 'rock bottom' NZ share market return on a share that went 'nowhere'!

Furthermore I think the outlook for RBD is much better than two years ago so see absolutely no reason to sell now. I don't see 'my competition' the NZX rising 25% this year. However, the chance of me repeating my tactics and making 14-15% pa even if the RBD share price goes 'nowhere' again are quite good. I'm quietly hoping the share price will slip back a bit so that I can increase my holdings at bargain prices again! But should this not happen I'm glad I am already aboard for the ride upwards.

SNOOPY

[cycat64]

The James and Jean Douglas Trust are the outfit that is gradually gobbling up Evergreen Forests. They are also involved with Southport.
My guess is that they are not mugs.

[duncan macgregor]

SNOOPY, i owe you heaps because of this debate over the years about RBD. I dont know if you realise that it was this very debate that made me see that a stop loss was a necessity, and the fundamentalists were the ones that fell in love with companies. I went further, and introduced my time line that gets me out if a share stagnates. I have no loyalty to any company, if they dont perform im gone. The next time the market crashes my money will be the first to hit the bank, the fundamentalists will bleat on about how right they are all the way down. The money you invested, and made a pittance over that period i more than doubled. Look it all up and have a rethink. all the best macdunk.

[Snoopy]

quote:Originally posted by duncan macgregor

SNOOPY, i owe you heaps because of this debate over the years about RBD. I dont know if you realise that it was this very debate that made me see that a stop loss was a necessity,


A 'stop loss' was not a necessity to me, as unlike all of the other 'punters of RBD' out there, I didn't sell and I haven't lost. I admit buying some shares at $1.70 and then at over $2 was a piece of bad judgement (however at one stage I bought some shares only 80c so my past judgement wasn't all bad). I did get carried away with RBD management's own hype and think Australia was there for the picking. But did my 'error of judgement' mean my subsequent purchases at $1.25 and $1.26 were a mistake? Of course not!


quote: and the fundamentalists were the ones that fell in love with companies. I went further, and introduced my time line that gets me out if a share stagnates. I have no loyalty to any company, if they don't perform im gone.


I base my RBD investment on steady cashflows, the low risk of losing capital, inspecting PH and KFC stores in Sydney and comparing those to the ones I see here (management strategy) , comparison with alternative yields available in other shares, consideration of capital spending requirements etc. This is not 'love'. This is one of my most carefully researched investments ever!

I am not primarily investing for growth with RBD, although there remains the possibility of a double whammy where both earnings and the P/E ratio are driven upwards.


quote:
The next time the market crashes my money will be the first to hit the bank,


So you keep saying, but we'll see. You are assuming you can sell out. In a really serious crash some shares may have no buyers at all - for a while. What are you going to do then? Just give your shares away?


quote:
the fundamentalists will bleat on about how right they are all the way down.


The fundamentalists will ignore the ravings of Mr Market when they don't need to listen to him, and rightly so!


quote:
The money you invested, and made a pittance over that period i more than doubled.


14% pa is not a pittance, particularly when using my strategy with RBD I am planning to make 14% in any coming bear market or any 'flat market' as well.

Your judgement of the kind of returns you can sustain long term has become warped by the bull market of the last two years IMO.

SNOOPY

[k1w1]

At the end of the opening rounds I have the beagle ahead on points..

[Halebop]

Ignoring the risk of lower returns and the chance of higher returns I think Snoopy's logic of earning steady returns from RBD through bear or bull is pretty good.

A little boring for my taste though. I would prefer to see some capital growth in the mix.

[duncan macgregor]

SNOOPY, To hold a share that makes 12pc when the monkey and a dart board makes double that must say tell you something about being right or wrong. to also buy a share at over $2 and watch it shrink to under $1 and still hold is financial suicide. When you were doing all this your star pupil shot past you in the straight. The monkey doubled your return, and i doubled the monkeys return. When a person is unable or unwilling to change they get left behind sooner or later. Your selling strategy is what is totally wrong, you dont have one. Most systems work some work, better than others, and the ultimate system still has to be thought up.
Your old mate macdunk

[croesus]

Excellent wee debate, maybe some of the foul mouthed fools, to whom personal point scoring is obviously the apogee of their day ... could take note

[Steve]

quote:Originally posted by cycat64

The James and Jean Douglas Trust are the outfit that is gradually gobbling up Evergreen Forests. They are also involved with Southport.
My guess is that they are not mugs.

I thought both EVF and SPN were fundamentally on a downwards slope?[?]

quote:Originally posted by Steve


quote:Originally posted by cycat64

The James and Jean Douglas Trust are the outfit that is gradually gobbling up Evergreen Forests. They are also involved with Southport.
My guess is that they are not mugs.

I thought both EVF and SPN were fundamentally on a downwards slope?[?]



THE KING says the best time to BUY is when every one is on the KNOCK counter is the best form of attack,, Snoopy THE KING is with you on this one cash in the hand is better than a bird in the BUSH.. [^][^]

[duncan macgregor]

KING , Perhaps Snoopy and your royal highness might like to join forces with your BGR and his RBD they are well matched. Only a thought to ponder over. Your loyal subject macdunk

THE KING says yesterday you where told," Duncan " it is hard for you to stop talking but its harder to stop talking as a THIRD type person and petend your a mate its not ON...[^][^]

[Bling_Bling]

The new Cajun chicken is way too dry and taste horrible. They need a Asian chef at the central kitchen.

[Snoopy]

quote:Originally posted by duncan macgregor

SNOOPY, To hold a share that makes 12pc when the monkey and a dart board makes double that must say tell you something about being right or wrong.

Only obvious with hindsight. Neither the monkey nor I had a crystal ball.


quote:
to also buy a share at over $2 and watch it shrink to under $1 and still hold is financial suicide.


As I commented earlier, I made the mistake of believing management hype. I also tried being a 'half pregnant' chartist. Being prepared to buy on the uptrend, but not being prepared to sell on the downtrend. Charting doesn't really work as a half measure. I have learned my lesson on both counts.


quote:
Your selling strategy is what is totally wrong, you don't have one.


It isn't quite true to say I don't have a selling strategy. I will sell when the lunacy of Mr Market bids something up to a crazy level.

The NZ market has tended to be cheaper in PE terms than overseas markets and income shares tend to have lower PEs than the market average. So in buying income shares on the NZ market I am really buying shares at 'rock bottom' price when measured in a global context.

That means even 'rock bottom' plus 40% is not necessarily expensive (take WRI as an example where despite the large gains I have made, I don't think of it is overvalued at $1.92). The short answer to your question is that because I buy my shares so cheaply they really have to rise in value by an enormous amount to for me to consider selling.

As for RBD, if we assume earnings of 10c per share based on a share price of $1.35 (look at that up another cent today!) that gives a PE of 13.5. Yet even the 'distressed retailer' WHS trades on a PE of 15 or something. By that comparison RBD must be worth at least $1.50 even if all of their growth strategies are a total failure. If RBD 'get it right' then the share price could go much higher than that. Overvalued might be a PE of 30 or a share price of $3.00. I don't see that kind of price on even the remote horizon so that is the reason I don't have an exit strategy from RBD.

RBD is so far away from my potential exit price, it is simply a waste of time developing an exit strategy at these low price levels. And while I am sitting there 'doing nothing' I am raking in a dividend at 12% gross. Far better to have my money sitting there than in a bank account paying 5%, wouldn't you agree?

SNOOPY

THE KING says as James & Jean are now on the inside looking out they must laugh as they walk down the road to bank the CHEQUE would be easy to say the KIWI`s have been done again GOOD on you SNOOPY.. [^]

[duncan macgregor]

PECULUAR names for a couple of turkeys dont you think your majesty?. On the outside laughing at those inside. macdunk

THE KING says Ducan your done it again for shore I`am not your majesty ever and not your frind your just GREEN about 2 people that have just beeten the KIWI`s.. [^]

[bongo66]

Steer clear. 15 min wait at a non busy time on Sat 12 at KFC. One person serving, 10 in line.

Trying to save money by making pieces smaller aint gunna cut it.

Vicki has not changed the culture of slackness that surrounds Starbucks , PH and in particular KFC.

Until service smartens up RBD will continue to flounder


B

[duncan macgregor]

GOOD GAWD, your not a king your majesty i can put up with that dont worry about it. Next thing i know is Snoopy will come out with a stop loss system. I wonder if the turkeys managed to get the secret recipe perhaps that had something to do with this sorry tale. The mind boggles the duke might not really be a duke either he might be a king thats why you keep covering for him. DONT WORRY ABOUT IT I AM STILL YOUR FRIEND EVEN IF YOU ARE ONLY A DUKE AND HE IS THE KING AND SNOOPY COMES OUT WITH A STOP LOSS SYSTEM. your ahem pal macdunk

THE KING says Duncan your just plain STUPID.. [^][^]

[duncan macgregor]

KING, it is not me that has the shares in the companies mentioned. macdunk

THE KING says now how long will it take to get rid of DUNCAN.. [^]

[hiawatha]

My original posting appears to be incorrect. Announcements of 11 February indicate that J & J douglas have purchased 15% - 5% on their own behalf and 5% for each of two trusts for which they are trustees.
hiawatha

[Paper Tiger]

quote:Originally posted by THE KING

THE KING says now how long will it take to get rid of DUNCAN.. [^]


You two guys are performing a modern version of MacBeth, right [?]

[TerryA]

PT,

If you are right "Spot" had better look out !

[Snoopy]

quote:Originally posted by hiawatha

My original posting appears to be incorrect. Announcements of 11 February indicate that J & J douglas have purchased 15% - 5% on their own behalf and 5% for each of two trusts for which they are trustees.
hiawatha


I think you were right the first time Hiawatha.

I've just been to 'stockness' to read the press releases. There are certainly three legal entities involved in the purchase:

1/ Kevin & Michelle Douglas
2/ Douglas family trust
3/ James Douglas and Jean Douglas Irrevocable Descendents Trust

I think that is why three Substantial Security notices were filed. However, I think the requirement to file was because they were related parties. Not because each of those entities hold 5% of the company individually.

I see the buying was done on market from April last year up until now.
Comparing the total 'votes' (which I assume must be the number of shares purchased) to the 'considerations' I calculate an average share purchase price of $1.34.

But $1.34 IIRC has been more or less the peak price over the purchase period. So what is going on there? Did the Douglas's buy all of their shares at the top of the market?

SNOOPY

[BRICKS]

WELL,, quite, quite and 5.01% has popped into Tower Asset fund for oversea buyers including Sir John Templeton so they bought over a long time very CHEEP.. [8D]

[duncan macgregor]

quote:Originally posted by Snoopy


quote:Originally posted by duncan macgregor

SNOOPY, i owe you heaps because of this debate over the years about RBD. I dont know if you realise that it was this very debate that made me see that a stop loss was a necessity,


A 'stop loss' was not a necessity to me, as unlike all of the other 'punters of RBD' out there, I didn't sell and I haven't lost. I admit buying some shares at $1.70 and then at over $2 was a piece of bad judgement (however at one stage I bought some shares only 80c so my past judgement wasn't all bad). I did get carried away with RBD management's own hype and think Australia was there for the picking. But did my 'error of judgement' mean my subsequent purchases at $1.25 and $1.26 were a mistake? Of course not!


quote: and the fundamentalists were the ones that fell in love with companies. I went further, and introduced my time line that gets me out if a share stagnates. I have no loyalty to any company, if they don't perform im gone.


I base my RBD investment on steady cashflows, the low risk of losing capital, inspecting PH and KFC stores in Sydney and comparing those to the ones I see here (management strategy) , comparison with alternative yields available in other shares, consideration of capital spending requirements etc. This is not 'love'. This is one of my most carefully researched investments ever!

I am not primarily investing for growth with RBD, although there remains the possibility of a double whammy where both earnings and the P/E ratio are driven upwards.


quote:
The next time the market crashes my money will be the first to hit the bank,


So you keep saying, but we'll see. You are assuming you can sell out. In a really serious crash some shares may have no buyers at all - for a while. What are you going to do then? Just give your shares away?


quote:
the fundamentalists will bleat on about how right they are all the way down.


The fundamentalists will ignore the ravings of Mr Market when they don't need to listen to him, and rightly so!


quote:
The money you invested, and made a pittance over that period i more than doubled.


14% pa is not a pittance, particularly when using my strategy with RBD I am planning to make 14% in any coming bear market or any 'flat market' as well.

Your judgement of the kind of returns you can sustain long term has become warped by the bull market of the last two years IMO.
SNOOPY
Old posts of two years ago some things never change. I found it very educational at the time. Two years down the track its even more educational.:D:D:D MACDUNK

[Steve]

And some people on Sharetrader accuse MACDUNK of being pig-headed and never listening to others opinions![:0]

I was never one of those people. Well done on the education MACDUNK;)

[BRICKS]

NOW that's over about NOTHING what about the TOWER HOLDING that's the NEW news.. [8D]

[biker]

quote:Originally posted by BRICKS

NOW that's over about NOTHING what about the TOWER HOLDING that's the NEW news.. [8D]


It would seem they wanted the market to be aware of their holding.With 5.04% the .041 may have been an attention getter to take them above the 5% mandatory SSH

Should be some news shortly on the completion of sales of Pizza Hut Victoria stores.

[Bling_Bling]

Isnt it SE regulation to file SSH once you reach 5% or more?

[Steve]

quote:Originally posted by Bling_Bling

Isnt it SE regulation to file SSH once you reach 5% or more?

Yes, but you only have to file the SSH in a timely manner...[:p]

[BRICKS]

quote:Originally posted by Bling_Bling

Isnt it SE regulation to file SSH once you reach 5% or more?


EVERY one knows that except SOME.. [8D]

[Bling_Bling]

Anyone got a valuation on this pup?


disc: Bling bought some at lower levels. :)

[BRICKS]

quote:Originally posted by Bling_Bling

Isnt it SE regulation to file SSH once you reach 5% or more?


Dont worry biker has change his STORY.. [8D]

[biker]

quote:Originally posted by BRICKS


quote:Originally posted by Bling_Bling

Isnt it SE regulation to file SSH once you reach 5% or more?


Dont worry biker has change his STORY.. [8D]


Thought the origional post was pretty clear but have changed it to satisfy the nit-pickers.The essence of the post hasn't changed.
By the way bricks, its not a STORY.Just my take on the situation and my answer to the question in your post.

[Bling_Bling]

I assume corporate play is still on the cards looking at the share prices holding up at these levels for so long. The company should keep us informed. Anyone have any views?

[winner69]

Tower buy another 65,000 shares (have shares in every company but been overweight RBD for a while) and headlines in the paper and it's all on

Wonder if Vicki is actively seeking a buyer .... instead of hanging around (forever maybe) waiting for someone to think there is some value in RBD

Would this approach result in better deal for shareholders?

[Bling_Bling]

Vicki wants to stay in her high paying job, she it would not be in her best interest to have a new owner.

[zyreon]

word is RBD is talking with Macquarie

http://www.stuff.co.nz/3970663a13.html