Collection House - CLH - Chart

[Offshore]

I am keen to learn more about Technical Analysis. With my limted TA knowledge I see CLH has been in an underlying uptrend since March, which has just been reconfirmed with a breakout(?) through the latest short downtrend. Plus RSI seems to be rising.
Is someone (Phaedrus?)able to comment on other indicators to use for someone at TA learning level, and also post a chart (as I have not managed to work out how to do that bit yet!).
Thanks in advance.

[limegreen]

Offshore, I've learnt pretty much all I know off Phaedrus, so I don't profess any high level of proficiency, however, here are two charts.

This first shows CLH's entire share history. Rather than focussing on anything too micro, I've plotted a zig-zag line which shows an all time high, followed by a low, by a lower high, a lower low, and a continuing sequence of lower lows and lower highs -- trending down over the long term. This is also illustrated by the 500 day moving average. You'll also see that there was perhaps a period of optimism mid 04 to the end of 05. It was a long time before the next lower low.

http://img.photobucket.com/albums/v361/limegreenz/clh20nov06_long.gif

Here is a slightly shorter chart, but you'll note a previous level of support at around 1.28, which CLH broke through in March 06. A break above this line would be a better omen, and the OBV seems to be increasing as well. That's a very long term approach, and this may be a turn-around story, but I've found it easier to buy into stocks that are long term going up.

http://img.photobucket.com/albums/v361/limegreenz/clh20nov06_short.gif

[winner69]

Thanks for the memories limegreen .... CLH sure was a winner post float .... didn't take long at all going from 140 to over 500 ...... it was a good ride while it lasted

I recall this was one of the favourite stocks on the other channel when it was thriving .... one of stollies favourites as well .... I think he did very well out of it.

[Offshore]

Thanks Limegreen thats very interesting to see a longer term chart - I had been focussing on the 1 year chart so you have shown a new perspective.

I have not used the OBV indicator - any idea where I can accesss this on a free chart site? I usually use Direct broking super charts, but cannot find OBV there.

CLH closed up again today.

[limegreen]

It's always worth looking at where a share has been (in this case it's entire history). I've often found that moving averages going down don't always fit going up the same, but it's still useful to see how your selected indicators would have performed in the past.

Phaedrus is a big fan of OBV (hence my interest). bigcharts (http://bigcharts.marketwatch.com) provide OBV, as does reuters charting facility (I forget the url).

[winner69]

A bit of discussion on CLH on another recent thread

Profit upgrade yesterday and the shareprice went close to $1

Make a few on this forum happy

[ratkin]

Collection house may be in the debt collecting buisness , however maybe they should be more concerned about the level of their own debt

[Stranger_Danger]

LOL and here comes the walking contrary indicator.

Buy, buy, buy folks.

Disc : CLH

[silu]

I am thinking about buying some more CLH because I think that they might be ripe for some corporate action soon. Not a very liquid stock due to directors owning approx 40% of the company. My limited technical abilities would indicate a "buy"? I appreciate any input.

[Phaedrus]

CLH has triggered recent Buy signals, Simla, as marked on the chart below.

http://i602.photobucket.com/albums/tt102/PhaedrusPB/CLHa78.gif

Let's take a look at a longer-term chart, though. CLH is in a downtrend, within a nice tidy trend channel. Who knows how far this will run? Some people think that buying downtrending stocks is a good idea. I am not one of them!

How good are those "buy" signals likely to be? The only thing we can do is see how well they have worked in the past. Here all previous "buy" signals are marked with green arrows. They would have had you buying all the way down this ongoing downtrend. Longer term trend indicators would have kept you out.

http://i602.photobucket.com/albums/tt102/PhaedrusPB/CLHb78.gif

I found your post quite worrying, Simla. You say "I am thinking about buying some more CLH" It would appear that you are :-
(1) Hanging on to a stock that is in a clear downtrend.
(2) Considering adding to this holding (ie averaging down).
(3) Prepared to buy a downtrending stock.

We all have different rules, I guess, but this breaks 3 of mine!

[silu]

Thanks Phaedrus. I admit that I made many mistakes early on in my investing career and CLH is one of them. About 9 years in the bottom draw and yes, I am thinking about averaging down. Without trying to sound like a "flake" I believe that CLH is ripe for takeover action and I was wondering if technical analysis is hinting at some action.

I have been away from sharetrading for too long. But having opened a business sucked any cash out of me until now. I am looking for ways in again and had a look at some stocks that I still own and CLH is one of them. I will keep an eye on a possible outbreak of the longterm downtrend before jumping in again. Again, thank you.

[silu]

Looks like it has broken out of its longterm downtrend. Also directors reported a profit/cashflow upgrade today. Now seems the time to buy more?

[drillfix]

Gapped up from 73c there silu.

Chart looks good, but now totally overbought and the 60 minute chart is starting to look toppy at 79c.

Its all good but at some stage this will need a breather by the looks of things, but Yep, it has broken its downtrend at 78c with a new recent high at 79c so hopefully it can hold up there for a day or two before taking a breather.

[mark100]

Not one I follow very closely but CLH put out a reasonable forecast today. Adjusting for the cum 3.1c dividend coming up it indicates a FY12 PE of around 6.7x. It's also on a historic yield of around 8%

On a 6 month chart you could say a close obove 78c would be significant?

I grabbed a few on open for a trade

[silu]

Also they are starting a Dividend Reinvestment Plan

discl. longterm holder and recently purchased more at 74.5 cents

[mark100]

Nice forecast today. I've had a reasonable holding since the break through 80c around 6 months ago. $1.20 was the target but I now estimate FY13 EPS nearing 15c so that target might be more like $1.50 now. Doesn't have the balance sheet of CCP but EPS are growing and its multiple is around 40% lower.

[silu]

Good thing I filled my boots at 75c a while back. Pays nice dividend (DRIP plan in place) as well.

[percy]

I am a bit late joining the party,brought a small parcel at $1.1925 this afternoon.

[NZSilver]

Seems to be a bit unloved lately.....

[mark100]

Back in this morning. Down around 20% in less than 2 weeks tells me it's oversold

[macduffy]

I'm tempted too, but will wait and watch. Two directors selling 1m shares each about a month ago may have been the catalyst for the sell-off. Why they sold isn't clear but both still have substantial shareholdings.

[mark100]

Strangely it briefly pushed on to a new high after those director sales. Its a funny time of year, results are out so there is a bit of a news vacuum and then when these small-mid caps go ex div the liquidity thins out for a while. You can get some funny price movements.

I bought back half my initial holding

[percy]

Dividend.Tried to put my NZ bank a/c number for the dividend.Would not accept it.As I don't have an Aussie bank a/c I "appear to have a problem."

[NZSilver]

Movement today - presentation given - last slide net profit after tax guidance revised to 14.8 - 15.4 million (8.1 NPAT million net profit last finacial year) What has this amount been revised from?

[mark100]

It's the same revised total provideed in the interim results. I've been accumulating these under $1.45, it was due to pop

[Penfold]

CLH up 9% today.... can't find any good reason why. PE of 15 doesn't make it look great value, but maybe pending results are going to to paint a different picture.

[silu]

A good result IMO and they continue to grow at a reasonable rate. It still seems to be a little too unsexy for a major price movement but fundamentals are looking better.

[AndyLP]

Trading halt today for capital raising. Wonder if this will be to expand their PDLs

[AndyLP]

Anyone else following this stock? Wondering if some people more experienced with this sort of SPP can answer, does CLH have a 1.65 target on its back?

[macduffy]

Hi Andy. I don't follow CLH but it's often the case that shareprices fall back to the SPP price. However, in this case the issue was fully subscribed, in fact the amount was increased to accommodate over-subscriptions which makes it particularly difficult to take a view on future demand. If the amount hadn't been increased I'd be more positive but it does look as though demand has been pretty well met. Sorry, I guess you'd come to that conclusion yourself.

[mark100]

The amount may have been increased but only slightly. I applied for the full $15k and got scaled back to $6.1k

[ozzie]

Sold right at the open, expecting the usual SPP dumping. I'm with CMC so had to phone up and request the shares to be transferred from the registry first though - God knows why they can't do the same as
Etrade and Westpac and do an automatic transfer, especially since I usually have to spend several minutes trying to get the operator to understand what it is I'm asking them to do. (A recent response was "What you're asking is impossible.")

[mark100]

Sold right at the open, expecting the usual SPP dumping. I'm with CMC so had to phone up and request the shares to be transferred from the registry first though - God knows why they can't do the same as
Etrade and Westpac and do an automatic transfer, especially since I usually have to spend several minutes trying to get the operator to understand what it is I'm asking them to do. (A recent response was "What you're asking is impossible.")

Yes I had comsec transfer them immediately and sold mine. Especially with the ex div date tomorrow I expect the buy depth ,may be a bit weak just when the new stock will be hitting the sell side

[ozzie]

Yes I had comsec transfer them immediately and sold mine. Especially with the ex div date tomorrow I expect the buy depth ,may be a bit weak just when the new stock will be hitting the sell side

Do you have any trouble getting Comsec to do a transfer? At least CMC do cheap trades at $9.90 for less than $10k - I'm surprised that Etrade and Comsec can survive
that sort of competition.

[mark100]

Do you have any trouble getting Comsec to do a transfer? At least CMC do cheap trades at $9.90 for less than $10k - I'm surprised that Etrade and Comsec can survive
that sort of competition.

I'm with the higher service end of comsec so someone answers my call straight away etc. I just ask to have my holdings refreshed and it's done. There are some perks with comsec that cmc wouldn't give you. They gave me a 6 figure allocation in the Virtus Health IPO which I made 30% on. Back in 2007 I got a massive allocation in the Platinum IPO which opened at a 70% premium. There have been other good IPO's and placements that I get through them so the extra brokerage is not really an issue.

[ozzie]

Wow those sound like pretty good perks! :) How much trading do you need to do to get to the higher service status?

[mark100]

Wow those sound like pretty good perks! :) How much trading do you need to do to get to the higher service status?

Not sure, I think it just happened automatically for me quite a few years ago

[silu]

The following item may be of interest.

Collection agency Credit Corp’s debt ledger ballooned to record highs of $136.8 million in fiscal 2013 as big retail banks and utility companies outsourced receivables management as part of cost-cutting measures.

The trend to outsource debt collection has created space for new players. But as overall growth in the $1 billion industry stalls, the contest to take market share from rivals is heating up.

Fast-growing Collection House bought $52.3 million worth of debt ledgers in the 2012-13 financial year, and plans to buy between $60 million and $70 million more in the next 12 months.

The Brisbane-based company’s full-year profits rose 23 per cent to $15.6 million, and it is forecasting between $17 million to $18 million for fiscal 2014.

Both Credit Corp and Collection House collect outstanding accounts of corporate customers, including the big four banks and a range of insurance, utilities, telecommunications companies and government agencies.

Credit Corp chief executive Thomas Beregi reckons the volume of debt sold by creditors will be static in the next few years and the amount outstanding on credit cards is also expected to be flat.

If he’s right, this leaves little room for organic growth in domestic debt collection and will also affect profit margins.

Prices for debt have escalated dramatically in the past few years, resulting in diminishing returns.

“The challenge for the industry is to ensure the price [paid for] debt and returns is appropriate,” Mr Beregi said.

“It will be interesting to see how participants go and whether they maintain discipline or succumb to temptation to keep buying without focusing on whether they’re profitable purchases.”

http://www.brw.com.au/p/business/debt_collectors_battle_it_out_for_jAlFiJyQJNhU1zMi Axv83N

[AndyLP]

Thanks for the share silu, certainly was of interest.

[mark100]

With the latest capital raising it will be very hard for them to achieve meaningful EPS growth this year

[percy]

Thanks Mark100 and KW.Was asleep again.!

[silu]

Good call KW. I sold almost all the shares I accumulated between 75-80 cents at $1.70 and kept a small parcel of free shares for old times sake.

[silu]

CLH mentioned on Fool's "3 stock that could make you rich in 2014".

Collection House (ASX: CLH): The receivables management provider is currently trading in bargain territory at $1.75 per share with a P/E ratio of just 12.4. The group continues to grow strongly, having reported a massive 23% increase in net profit after tax (NPAT) for the full year. Led by a strong management group, this company could certainly boost the value of your portfolio for years to come.
http://www.fool.com.au/2013/12/29/3-stocks-that-could-make-you-rich-in-2014/?source=aptyholnk3030003


discl. hold CLH & NWT

[silu]

Nice little run up to over $2 for the first time. Out of curiosity - how does one analyse the chart in this case?

[mark100]

Seems to have responded well to CCP's results this morning. I thought CCP's results were ok but they are gearing up the balance sheet to achieve growth now. Not ideal.

[silu]

Nice little break-out lately after FY announcement.

Key financial highlights for FY14 include:

NPAT of $18.7 million – a record profit for the Group and an increase of 20 percent
on 2013 financial year results (FY13).

A fully franked dividend of 8 cents, an increase of 11 percent on FY13.

Record investment in PDLs of $82.2 million.

Gearing ratio (net debt / net debt plus equity) has been reduced from 41 percent to
39 percent, which is the lowest it has been for seven years.

Earnings before interest and tax (EBIT) margin has improved from 29 percent to
30 percent.

Strong operating cash flow of $65.9 million, up from $62.2 million in FY13.

Collection Services revenue increased 12 percent in FY14 compared to FY13.

Purchased Debt Ledgers (PDLs) collections increased 10 percent in FY14
compared to FY13.

[winner69]

See this outfit gone bust

Did well out of CLH zonks ago.

[nztx]

Gawd , a Debt Collector finds itself getting buried .. how did they manage that ? ;)

[silu]

See this outfit gone bust

Did well out of CLH zonks ago.

I don't trade very often but did very well trading this between 2002-2017. Out of 18 trades in this period only one was in the red. They just paid way too much for debt ledgers that had only a very slim chance of getting recovered.