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  1. #4451
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    Exclamation Are the good times about to become less good?

    wage costs aside (as I think an overwhelming majority of these rises will be covered, even when thinking about flow on effects to other jobs and their pay) what sounds more concerning to me is the below...

    SUM are very heavy Auckland based. Despite a little price increases in Auckland housing market, and developments 'feeling the strain' (I read this as slower delivery and higher cost), they still seem to think they can maintain their development margin (of about 22%) and still increase the build rate to 450 units pa? (not to mention interest rates on borrowings likely beginning to increase, alongside them borrowing more than ever before). Despite these factors, no change to profit forecast (I think)?

    Sounds like they are trying to pull a rabbit out of a hat, but, then again, they do have very good track record of producing results so will be interesting to see.

    Hopefully SUM are not pulling a CVT and say "there will be no impact" [of new chinese regulations] then produce a terrible result not long after... or a FBU and say one thing, then a couple weeks later come out and say another, much worse, thing.
    Last edited by trader_jackson; 27-04-2017 at 06:39 PM.

  2. #4452
    percy
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    Quote Originally Posted by trader_jackson View Post
    hmm this does sound potentially concerning as SUM are very heavy Auckland based.

    Despite a little price increases in Auckland housing market, and developments 'feeling the strain' (I read as slower and higher cost), they still seem to think they can maintain their development margin (of about 22%) and still increase the build rate to 450 units pa? (not to mention interest rates on borrowings likely beginning to increase, alongside them borrowing more than ever before). Despite these factors, no change to profit forecast (I think)?

    Sounds like they are trying to pull a rabbit out of a hat, but, then again, they do have very good track record of producing results so will be interesting to see.

    Hopefully SUM are not pulling a CVT and say "there will be no impact" [of new chinese regulations] then produce a terrible result not long after... or a FBU and say one thing, then a couple weeks later come out and say another, much worse, thing.
    After 20 successfull years that is not going to happen.

  3. #4453
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    Quote Originally Posted by percy View Post
    After 20 successfull years that is not going to happen.
    Yes, I don't think it will happen either, but a downgrade or 'good times becoming less good', could.

  4. #4454
    percy
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    Quote Originally Posted by trader_jackson View Post
    Yes, I don't think it will happen either, but a downgrade or 'good times becoming less good', could.
    No not with their widespread land bank.
    Builders and construction people in ChCh will move to where the work is.
    Their "model" is now proven and robust.
    No borrowings other than for developments,means they are well positioned.
    Last edited by percy; 27-04-2017 at 06:48 PM.

  5. #4455
    Senior Member
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    Dear Xerof....obviously you are a trump supporter....

  6. #4456
    Senior Member
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    Quote Originally Posted by trader_jackson View Post
    wage costs aside (as I think an overwhelming majority of these rises will be covered, even when thinking about flow on effects to other jobs and their pay) what sounds more concerning to me is the below...

    SUM are very heavy Auckland based. Despite a little price increases in Auckland housing market, and developments 'feeling the strain' (I read this as slower delivery and higher cost), they still seem to think they can maintain their development margin (of about 22%) and still increase the build rate to 450 units pa? (not to mention interest rates on borrowings likely beginning to increase, alongside them borrowing more than ever before). Despite these factors, no change to profit forecast (I think)?

    Sounds like they are trying to pull a rabbit out of a hat, but, then again, they do have very good track record of producing results so will be interesting to see.

    Hopefully SUM are not pulling a CVT and say "there will be no impact" [of new chinese regulations] then produce a terrible result not long after... or a FBU and say one thing, then a couple weeks later come out and say another, much worse, thing.
    Perhaps they have fixed their rates. Projections are only a year out, not too hard to predict. Besides, rates won't go up much in a year.

  7. #4457
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    Quote Originally Posted by Joshuatree View Post
    Thanks guys. S/P ended up down 10c ,125,000 through. Was it because costs are rising?
    Why did the share price fall two weeks ago from $5.45 to $5.10? there was no news whatsoever to justify a 6.8% drop over the duration of 1 week. In addition, on March the 29th it hit $5.25 after a nice rally then dropped to $5.17 the next day. again for no apparent reason. It seems convenient to blame todays drop on just the AGM. Perhaps it was just sellers who missed out on the last run to $5.40 wanting to lock in some profit before it drops back down again.

    Just to clarify: i'm not saying that the AGM results had no effect at all on todays drop, however, my point is that there is never a definitive answer for why the market reacts the way it does.

  8. #4458
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    Dear Joe....welcome to the share market..an irrational beast it is...My best advise I can give you is look at the trajectory of the SP....over weeks ..months...look at the volumn...not shares but the dollar value...I would guess (sadly0 that a majority of folk in the SM treat same as a casino..in ...and out for a quick profit...be cautious...look at the dollar trading value....go well

  9. #4459
    The past is practise. Vaygor1's Avatar
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    Quote Originally Posted by JoeGrogan View Post
    Why did the share price fall two weeks ago from $5.45 to $5.10? there was no news whatsoever to justify a 6.8% drop over the duration of 1 week. In addition, on March the 29th it hit $5.25 after a nice rally then dropped to $5.17 the next day. again for no apparent reason. It seems convenient to blame todays drop on just the AGM. Perhaps it was just sellers who missed out on the last run to $5.40 wanting to lock in some profit before it drops back down again.

    Just to clarify: i'm not saying that the AGM results had no effect at all on todays drop, however, my point is that there is never a definitive answer for why the market reacts the way it does.

    Hi Joe.

    Troyvdh has provided good advice there.

    As an analogy, the price one would hypothetically get for ones house can easily vary by more than your examples every day/week/month depending upon (amongst other reasons) the the time of the year, the number of people looking to buy, and their respective needs, drivers, and cash positions...and this in combination with the vendors needs, desires, and level of urgency to sell.
    The thing is that with a house, these fluctuations are invisible on a day by day basis.. there is no daily tender or daily auction on any given house to enable such a measure to be undertaken.
    But with the sharemarket, a company's market worth is measured and available for scrutiny every day... the trick is to not get hung up about it... institutions, consortiums, trusts, individuals etc all buy & sell for literally an endless combination of reasons, and as such these variations to which you refer are nothing out of the ordinary.

    Select companies with sound fundamentals with good growth prospects, work out a good-value share price (aka a bargain) to buy in at using your own sets of measures, and then enjoy the ride once you have secured your position. Best of luck to you and keep posting.
    Last edited by Vaygor1; 28-04-2017 at 12:27 AM.

  10. #4460
    IMO
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    Quote Originally Posted by JoeGrogan View Post
    Why did the share price fall two weeks ago from $5.45 to $5.10? there was no news whatsoever to justify a 6.8% drop over the duration of 1 week. In addition, on March the 29th it hit $5.25 after a nice rally then dropped to $5.17 the next day. again for no apparent reason. It seems convenient to blame todays drop on just the AGM. Perhaps it was just sellers who missed out on the last run to $5.40 wanting to lock in some profit before it drops back down again.

    Just to clarify: i'm not saying that the AGM results had no effect at all on todays drop, however, my point is that there is never a definitive answer for why the market reacts the way it does.
    Often folks who are at the AGM have their phones at the ready to buy/sell as the meeting progresses depending on the detail, confidence etc.Im guessing it wasn't the knockout euphoric show that some(who were buying the day before) seemed to be expecting.

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