OCA - Oceania Group - retirement villages

[Daytr]

*there....

There there. Feel better?
Mate you need to take a break.
Been back what is it a week?
And totally fixated.

[Baa_Baa]

So you are saying OCA can outperform its all time high by 3.4 multiple vs 2.3 for RYM.
Of course anything is possible and typically it's easier to double a lower smaller business than a larger one but then their is the added risk involved.

I didn't say OCA can, or that either of them can, but yes purely on SP, I think OCA would be a better chance of a ten-bagger from here, than RYM. From the SP here and now, not about multiples to their ATH, that's your strawman.

Assuming SP is all you're into.

What I'd really like to see is that all of the RV's turn into a shareholders dream cash generating machines (which they could be) and payout excess profits as dividends. Of all sectors, the RV's are best placed to do that, whereas historically they're all hell bent on growth and have been in TOTO providing awful returns to shareholders.

It's either that, stabilise development and payout a decent share of operating profits, or show us how ongoing growth is going to significantly grow the SP. Currently they're doing neither.

Maybe I'm saying that I hope this market shock recalibrates the sector towards rewarding its shareholders with returns on their investment, rather than just relentlessly growing their pie for no return to shareholders, so far. None of them are at present focused on this. It's not an 'either or' binary choice, it's about balancing growth against returns to shareholders.

The current market is saying the RV sector investment model is screwed and it's rerating SP's accordingly. That's code for "if you don't or can't give us shareholders a return on our investment, we'll take our money elsewhere".

[SailorRob]

What I'd really like to see is that all of the RV's turn into a shareholders dream cash generating machines (which they could be) and payout excess profits as dividends. Of all sectors, the RV's are best placed to do that, whereas historically they're all hell bent on growth and have been in TOTO providing awful returns to shareholders.

It's either that, stabilise development and payout a decent share of operating profits, or show us how ongoing growth is going to significantly grow the SP. Currently they're doing neither.

Maybe I'm saying that I hope this market shock recalibrates the sector towards rewarding its shareholders with returns on their investment, rather than just relentlessly growing their pie for no return to shareholders, so far. None of them are at present focused on this. It's not an 'either or' binary choice, it's about balancing growth against returns to shareholders.

The current market is saying the RV sector investment model is screwed and it's rerating SP's accordingly. That's code for "if you don't or can't give us shareholders a return on our investment, we'll take our money elsewhere".

Great post and I have been thinking along these lines as well.

Following this model will do a number on future supply as well which could lead to a double whammy for the industry.

If what you'd like to see happens, or at least in part, then stand back, it will be spectacular.

[Mrbuyit]

I think we were talking inflection point ~500 pages ago.

[SailorRob]

I think we were talking inflection point ~500 pages ago.

Which was probably only a few days ago.

Let's talk in 2040, if that's too far away you shouldn't own equities.

[X-men]

Are we there yet?

[Mrbuyit]

For sure an amount of patience is required, how much patience who knows... I checked back to 2019, and the August dividend was 2.6c on a $1 share..

I guess like Baabaa is suggesting going from 5% div to zero is going to change the sentiment of some holders, and maybe others were holding as a dividend stock and have had to shift focus.

[mistaTea]

For sure an amount of patience is required, how much patience who knows... I checked back to 2019, and the August dividend was 2.6c on a $1 share..

I guess like Baabaa is suggesting going from 5% div to zero is going to change the sentiment of some holders, and maybe others were holding as a dividend stock and have had to shift focus.

Well, for a business in growth mode like OCA, investors should want zero dividend from the get go and have all funds reinvested back into the business.

When a dividend is being paid and is reduced or removed because of ‘tough times’ then that is different altogether and understandably adds some negative sentiment towards the business.

Investors should (logically) only want a dividend when OCA (or any other business for that matter) can no longer invest the money sensibly for long term growth.

[Baa_Baa]

For sure an amount of patience is required, how much patience who knows... I checked back to 2019, and the August dividend was 2.6c on a $1 share..

I guess like Baabaa is suggesting going from 5% div to zero is going to change the sentiment of some holders, and maybe others were holding as a dividend stock and have had to shift focus.

It was, as all RV's were and still are, sh1tty dividend holding shares, and lately severely down rated capital growth shares. They all need to refocus imo on what their investors want from them, it's not all about never ending growth, it's about ROI. And ROI to-date has been abysmal.

[ValueNZ]

It was, as all RV's were and still are, sh1tty dividend holding shares, and lately severely down rated capital growth shares. They all need to refocus imo on what their investors want from them, it's not all about never ending growth, it's about ROI. And ROI to-date has been abysmal.

Oceania should do whatever is most value-accretive for it's shareholders. So as long as they have the ability to grow its ORA account at 15-20% CAGR, that's what I want them doing.

Don't get me wrong, either way will create epic long term returns.