TRA - Turners Automotive Group [previously TNR - Turners Limited]

[winner69]

Snoopy’s post showing that the $9m of abnormals / one offs in F18 reads as if they raided every bottom drawer they could to boost profits to a respectable $23m profit.....otherwise it would have been ne disasterous year.

Maybe it really was and that’s why the share price fell so much

[Beagle]

Beagle.. We also need to consider the sunset nature of the industry...plenty of overseas car companies trading on single digit 2019 PE's reflecting the overarching nature of where the industry is headed over time.
Some sobering examples on a quick look on market screener.
Ford 6.4
GM 6.2
Fiat Chrysler 4.5
BMW 6.7

[winner69]

Interesting to see how the markets perception of "the right" PE is changing. Its not that long ago that the market thought a PE of 15.8 is highly appropriate for TRA (24 cents EPS in FY2017 - SP $3.80). Today Mr Market thinks that a PE of 8.3 is just right (29 cts EPS in FY2018 at $2.40). And - as we all know, Mr. Market is always right and always will be. However - Mr Market likes to change his mind without notice and sometimes he is euphoric and sometimes gloomy.

I think your (beagle's) view is absolutely legitimate - and sure, if TRA's strategy doesn't work out and they always stay a boring old used car dealer without any noticable additional income from insurance, finance, maintenance, end-of-life business and property development than, yes - longterm an average PE of around 10 might be quite appropriate. But isn't their income from all these other "branches" growing?

So - assuming for a moment their strategy does work out and their market share and margin is growing - than maybe the downside risks at the current share price are lower than the potential upside rewards ...

Unless we think TRA will be biting the dust or continuously shrink ... market is normally cycling between euphoria and gloom ... and given that we are currently in gloom mode - what would be next? More gloom?

Problem is bp that euphoric people don't recognise euphoria when they see it.

[BlackPeter]

Problem is bp that euphoric people don't recognise euphoria when they see it.

How do you know and why is this a problem?

[couta1]

Goes Ex divvy on Monday, no one gives a toss about it by the looks of the SP, should just stay the same after the divvy comes off in that case.

[minimoke]

Goes Ex divvy on Monday, no one gives a toss about it by the looks of the SP, should just stay the same after the divvy comes off in that case.I' hoping so - only way I'm going to recover my capital loss is if SP holds up.

[percy]

Snoops; the insurance float is the property developer. You will find the 'profits' booked to the insurance business.
Look at AR (to 31Mar18 ), top of page 7, to read all about it;

"We have continued to build our investment into property,
with the aim of securing strategic sites to extend our footprint
or for reconfiguration of existing sites to drive improved retail
experience for further growth. We have allocated a proportion
of insurance reserves to support this property strategy as
it achieves better utilisation of capital in the business, and
improved insurance division returns."
Makes very good sense.
With site developments planned over the next 5 years,insurance division is "well positioned."

[Beagle]

This signing up for long leases with expensive minimum annual rent adjustments (which really compound and catch up with you in the future) and on-sale for a profit is not a new trick by any means and has been used by "highly successful" companies in recent times like the Warehouse and PGG Wrightson. All you are doing is making your accounts look artificially good for now and effectively handicapping future profits. In my opinion Snoopy is dead right to adjust these profits out which leaves the company with quite modest true sustainable eps. I am sure others will have a different interpretation of this creative approach and that's fine.
Here's some more 2019 motor vehicle PE's to further illustrate my point made earlier, mainstream Japanese manufacturers this time
Honda 7.8
Mazda 8.5
Motor vehicle manufacturing, sales and distribution is not a high PE business, its a low PE cyclical business in very gradual long term systemic decline.

[percy]

Makes great sense to me.
Get the site they want and can put the buildings they want.
Most landlords want their site covered in buildings.This does not suit Turners,who require only small amount of land for office etc,and most of a site for displaying vehicles.
Once Turners have developed a site they know the rent that site will afford,and can then decide to hold or sell..
The Wiri site I doubt they will sell.
Other sites such as ChCh, where they are not in agreement with the landlord,they can either foccus the landlord's atention ,or develop their own site.
It is called independence.
And why should they fatten a developer's pocket?
Might just as well "clip the ticket" themselves.

[Snoopy]

Snoops; the insurance float is the property developer. You will find the 'profits' booked to the insurance business.
Look at AR (to 31Mar18 ), top of page 7, to read all about it;

"We have continued to build our investment into property,
with the aim of securing strategic sites to extend our footprint
or for reconfiguration of existing sites to drive improved retail
experience for further growth. We have allocated a proportion
of insurance reserves to support this property strategy as
it achieves better utilisation of capital in the business, and
improved insurance division returns."

I saw that Greater Fool. Not saying you are wrong, although you might be. But I interpreted that paragraph differently. Instead of using a bank loan to develop a site, Turners are using insurance float money. They pay the insurance division a fixed interest return on that money while the site is being developed. Then the site is sold to a third party and the insurance division get their capital float back with interest: A lot more interest than they would have got had they plonked their float money in a bank account. But Turners shareholders are banking the development profit, not insurance policy holders! I don't believe the insurance division has any more involvement with the property after that.

SNOOPY

[percy]

The profit from the sale of the Roscommon Road property was booked by the insurance division.
Therefore I take it was owned by that division.

[Snoopy]

The profit from the sale of the Roscommon Road property was booked by the insurance division.
Therefore I take it was owned by that division.


Thanks for that Percy.

From the Argosy HY2019 interim result in November 2018.

"Argosy also acquired a freehold 15,838 sqm industrial yard in September on Roscommon Road, Wiri for $8.6 million. The site is leased to NZX listed Turners Automotive Group on a 15-year lease, providing a holding return of 5% with fixed reviews of 2.5% per annum, with a market review in year six."

I couldn't find a link/ news release referencing the Turners side of the deal. Do you have one? If the profits were indeed booked by the insurance division, do we Turners shareholders get to keep the any capital float left after all the insurance obligations have been paid out?

SNOOPY

[percy]

This was dicussed on the Argosy thread.The only announcement was Argosy's,none from Turners.
I think they do it to confuse you..lol.
Fun was had as Turners owned two properties on Roscommon Road,and we got mixed up by thinking there was only one property Turners owned on that road.I blame Beagle....lol.
The other site is a corner site,that they developed.Fantastic position for their trucks and equipment sales.
This new site they paid $6.8mil for,and my guess they would not sell it for twice that amount.

The second part of you post.Offcourse we do.!

[Snoopy]

I think your (beagle's) view is absolutely legitimate - and sure, if TRA's strategy doesn't work out and they always stay a boring old used car dealer without any noticable additional income from insurance, finance, maintenance, end-of-life business and property development than, yes - longterm an average PE of around 10 might be quite appropriate. But isn't their income from all these other "branches" growing?


I have long been concerned about the reverse of the 'clip the ticket' effect. While things are going well, all the different divisions get to 'clip the ticket' in a growth spiral. But when things are not going so well, do all the divisions miss 'clipping the ticket' in a contraction spiral?

The downturn in the car market that has affected Auckland and the figures thrown up by that shed some light on this question.



DivisionHY2019HY2018ChangeFY2017HY2017e




Automotive Retail EBT {A}$8.013m$8.771m-8.64%


Automotive Retail Revenue {B}$112.765m$115.694m-1.49%


Automotive Retail EBT Margin {A}/{B}7.11%7.58%


Inventory$42.877m$42.143m+1.74%





Finance EBT {C}$5.423m$5.537m-2.06%


Finance Revenue {D}$25.564m$17.791m+21.2%


Finance EBT Margin {C}/{D}21.2%%31.1%


Insurance EBT {E}$6,414m$2,627m+154%


Insurance Revenue {F}$25.669m$22.369m+14.7%


Insurance EBT Margin {E}/{F}25.0%11.7%


Autosure EBT$5.426m/0.72$3.768m


Autosure Revenue$34.300m$17.150m


Autosure EBT Margin22.0%22.0%







Collection EBT {G}$3.076m$3.413m-9.87%


Collection Revenue {H}$9.249m$10.189m-9.23%


Collection EBT Margin {G}/{H}33.2%%33.5%



The increasingly tough Auckland market has barely affected overall car sales revenue. So Turners are still able to shift nearly as many cars as before. But the operating profit on car sales is hurting. Inventory is slightly up on the prior comparative period (pcp). But 1.7% is near margin of error stuff. Divided by the number of branches now open, with new branches in Wellington City and New Plymouth and Hamilton, the number of stock per premises may even be down. The new Turners branches plus the new 'Buy Right Cars' branch in Hamilton is evidence of Turners growing market share in a tight market.

Meantime in Finance, revenue is up strongly even as car sales are static. Part of this could be the new dealers outside of Turners ownership who are plugged in to Oxford Finance, those 150 new originators that Percy keeps referring to. But not all Oxford Finance is car finance. It is possible that Oxford are taking on more consumer loans as the big banks tighten their lending criteria.

Insurance is up strongly with both profit and revenue. The purchase of 'Autosure' was settled on 31st March 2017, which is Turner's balance date. So FY2018 was the first year that 'Autosure', extended mechanical warranty insurance, became part of the Turners Automotive Group. We must also remember that Insurance includes a likely $6m in premiums relating to Life insurance, completely unrelated to Automotive sales activity. We heard at the roadshow how the payout ratio on European brand cars with Autosure policies was generally much higher than those of Japanese origin. And that Turners would be adjusting their Autosure premium pricing to reflect this. That change, plus better integration with the finance operation are likely largely responsible for the hugely improved performance of the insurance division.

When faced with a downturn it is tempting to suggest that Sales, Finance and Insurance will suffer together. But this assumption is assuming that all three divisional sales already reflect maximum integration efficiencies across the whole group. This is far from the truth as the half yearly pcp comparisons show. We can also expect that retail stocking rates will now be closely monitored to ensure that excess inventory, or the wrong type of inventory does not stick around. I would be expecting a slight uptick in car sales profitability going forwards, even if car sales shrink from here, as a result of better matching inventory to market.

The EC Credit side of the business shows a remarkably consistent margin even though revenue has fallen. This is because EC Credit is not an asset rich business to run and wage inflation can be offset by increasing automation. EC Credit is going along its own path with significant expansion planned in Australia. This is uncorrelated with the NZ car sales market, and we shareholders can realistically hope for better things from EC Credit.

Overall then, I see far from a gloomy picture. The benefits of a fully integrated business in NZ are, I believe, yet to be fully seen. I have plenty of optimism that these improvements will offset any short term retail downturn. The share buyback will help improve the eps situation after years of dilution. And Turners have the ability to quickly turn inventory into cash if there are ever any parent bank debt issues to address. Has the share price reached a bottom? Mr Market always has the last word on that! But I have some cash available for some fresh 'bottom picking' if the share price moves lower.

SNOOPY

[Snoopy]

This was dicussed on the Argosy thread.The only announcement was Argosy's,none from Turners.
I think they do it to confuse you..lol.
Fun was had as Turners owned two properties on Roscommon Road.
The other site is a corner site,that they developed.Fantastic position for their trucks and equipment sales.
This new site they paid $6.8mil for,and my guess they would not sell it for twice that amount.

Does not the fact that the profits were booked for Turners shareholders, and not Insurance policy holders, suggest that it is we the shareholders that benefitted from the Roscommon Road property redevelopment?

SNOOPY

[percy]

Correct.....

[percy]

I have long been concerned about the reverse of the 'clip the ticket' effect. While things are going well, all the different divisions get to 'clip the ticket' in a growth spiral. But when things are not going so well, do all the divisions miss 'clipping the ticket' in a contraction spiral?

The downturn in the car market that has affected Auckland and the figures thrown up by that shed some light on this question.



DivisionHY2018HY2017Change



Automotive Retail Revenue$112.765m$115.694m-1.49%



150 new originators added in the 1st half alone.
OK these are not Turners vechicle sales,but these originators are "selling" Turner's owned Oxford Finance loans, and most probably these borrowers took out Turner's owned Autosure policies.[Two "tickets"].
Not long ago Turners announced another insurance company are using Turners for their end of life logistics and sales.Therefore that "ticket" is getting bigger too.
So where are we.?
Turners property division working on ChCh and Auckland and possibly other developments.
Turners and BuyRight vehicle sales in Auckland are most probably down.
BuyRight Cars in Hamilton last reported to be trading ahead of budget.
Turners vehicle sales for the rest of the country,we do not know,yet two more sites added recently..
Oxford Finance,with Turners themselves putting more their way,about $5mil a month, I last heard [rather than through MTF]together with the 150 extra new originators.Could be well up,could be down.
Autosure.As above with more originators could be up,could be down.
Vehicle Sevice ticket.New,I expect it will start as a small "ticket".
End of Life vehicles.Certainly looking to be well up."Big ticket".
EC Credit.Unsure.

[winner69]

TRA chart sees price getting close to the 50MA

The other day somebody told me he follows the 48MA .....said it gives him a two day head start on the mob.

[winner69]

Wonder if Turners will ever be part of a Tinder like thing for car sales .....

https://www.businessnewsaus.com.au/articles/how-carswap-is-taking-on-a-monopoly-with-its-next-gen-auto-classifieds-app.html?utm_source=Business+News+Australia&utm_campaign=97904d054e-EMAIL_CAMPAIGN_2018_08_30_COPY_01&utm_medium=email&utm_term=0_cc7ab388bc-97904d054e-%5BLIST_EMAIL_ID%5D&ct=t%28EMAIL_CAMPAIGN_30aug+2018_COPY_01%29&mc_cid=97904d054e&mc_eid=%5BUNIQID%5D

[winner69]

I feel honoured .....just got a message saying Porirua and Wellington yards will be open Monday even though a public holiday

As a shareholder pleased my staff are clipping tickets on a public holiday ...hope they are busy as

[percy]

I feel honoured .....just got a message saying Porirua and Wellington yards will be open Monday even though a public holiday

As a shareholder pleased my staff are clipping tickets on a public holiday ...hope they are busy as

So do I...................lol.

[Beagle]

https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12192582

[winner69]

https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12192582

Likely Lime users not in the used car market anyway

No threat to Turners here

Might even see Line users say to themselves heck owing a car might be a good idea ...good for Turners

[percy]

Going to be interesting seeing what "the disruption" Lime Scooters cause.
So far the business model looks fantastic to me,although a cold winter here will be the test.
I am noticing most of the users appear to be under 20,and a lot of school aged teens.Well in my area.
My first thoughts are ChCh buses will lose a lot of custom.Whether or not this means a reduction in bus services, time will tell.Reduction of bus services will see more cars on the road.
May even see out of town residents driving into ChCh, and leaving their car out of the central city, and getting to work on a Lime Scooter.
I do not see either Toyota or Ford stopping producing cars and building scooters anytime soon.

Interesting noting Motor Trade Finance, Moorhouse Ave, is owned by two very experience ex car dealers,Simon O'Connell, and Brent Robertson [Brents Toyota].Perhaps financing is more profitable?

[Beagle]

Chch and Auckland very different markets Percy. Huge amount of major new multi level housing developments (very intensive zoning allowed by Auck Council) going on very close to existing transport infrastructure, (train and bus stations). Overseas research is showing more and more young people are more keyed in to having the latest smart phone than wanting a car and if its easy and cheap to catch public transport and then use a Lime scooter or some other ride share platform that's what they'll increasingly be doing. I think the Lime scooters are a bit of a game changer for public transport because previous people who were reluctant to use it because of the walk from the train station to work have had that problem solved for them. The daily cost of parking in central Auckland has gone from expensive to completely ridiculous. I see Lime and their ride sharing ilk as having meaningful long term demand implications for customers of the type that might previously have bought a cheap second hand car.

[percy]

Yes I think we will all be watching this space with interest.
Lime planes could save the hassle of airports.?

[Beagle]

Likely Lime users not in the used car market anyway

No threat to Turners here

Might even see Line users say to themselves heck owing a car might be a good idea ...good for Turners
They might have been if Lime wasn't so incredibly convenient for them. 1.2 million rides in such a short time tells you this Lime movement has real momentum
https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12191975 I would imagine from what I have seen its mostly young people might have otherwise bought a cheap car...old Beagles wouldn't dare ride one...balance is hopeless :)

[Beagle]

Yes I think we will all be watching this space with interest.
Lime planes could save the hassle of airports.?

Saw a few of these on the weekend. Lime Paramotor's, the quick way of getting to the Airport coming to your city soon :)
https://www.youtube.com/watch?v=jMUfkVsghrY Go on Percy, give one a go !

[percy]

Thanks me.!!

[Baa_Baa]

You Old Limers haven't looked into the cost yet have you? https://www.stuff.co.nz/business/money/108189860/sour-taste-left-by-high-cost-of-lime-escootering. Once the novelty wears off and the weather gets worse, the costs will put off a lot of people. Or so my <20's kids are telling me. Uber, that's their favourite go to transport. Or train, or bus in the city. Fancy Lime Scooters being more expensive than all of them.

Not sure what this has to do with TRA.

[percy]

Wonder whether Lime pay ACC fees.?

PS.My Granddaughter has her own personal "charity" Uber..................................me.!!!...lol .

[Baa_Baa]

Wonder whether Lime pay ACC fees.?

Of course they do, but only ACC Company Levies, like all companies. Not what you may be implying(?) that they should be paying more for renting dangerous scooters to reckless people. They just like any other car or motorcycle rental company, they pay no more ACC levies for the fact that the thing they rent could cause serious harm when the renter gets it wrong and is harmed. They may have boosted Professional Indemnity and Directors Liability insurance though, to cover the inevitable suits that will/are coming, but no .. nothing compels them to boost the ACC coffers.

[percy]

Of course they do, but only ACC Company Levies, like all companies. Not what you may be implying(?) that they should be paying more for renting dangerous scooters to reckless people. They just like any other car or motorcycle rental company, they pay no more ACC levies for the fact that the thing they rent could cause serious harm when the renter gets it wrong and is harmed. They may have boosted Professional Indemnity and Directors Liability insurance though, to cover the inevitable suits that will/are coming, but no .. nothing compels them to boost the ACC coffers.

Thanks.................................
I expect their fees are a lot higher than booksellers.!

[allfromacell]

You Old Limers haven't looked into the cost yet have you? https://www.stuff.co.nz/business/money/108189860/sour-taste-left-by-high-cost-of-lime-escootering. Once the novelty wears off and the weather gets worse, the costs will put off a lot of people. Or so my <20's kids are telling me. Uber, that's their favourite go to transport. Or train, or bus in the city. Fancy Lime Scooters being more expensive than all of them.

Not sure what this has to do with TRA.


Limes are a bit too expensive for now but I'm sure future competition will sort that out. I love riding them and am looking to get my own scooter in the near future. The convenience of being able to leave them wherever however is awesome.

I'll still keep my old second car around for now. Auckland is a large city and I think most people will find a car is still necessary.

[percy]

I wonder whether the independence and mobility of riding Lime scooters will in fact lead to more people buying their own car.

As young man I managed a lot of activity in my Morris Minor, I would have missed out on scooters....lol.

[iceman]

I wonder whether the independence and mobility of riding Lime scooters will in fact lead to more people buying their own car.

As young man I managed a lot of activity in my Morris Minor, I would have missed out on scooters....lol.

They now have "pods" for people like the young Percy https://www.bing.com/images/search?view=detailV2&ccid=kOnho%2ffM&id=4920AD1B40B659F2C68C7E4C5F2A1339434B14BD&thid=OIP.kOnho_fMNTE_Wc7TCfBWjAHaE8&mediaurl=https%3a%2f%2fcdn.vox-cdn.com%2fthumbor%2fKHCnp073xchPAmuaoVZjoYFgKzU%3d %2f0x0%3a1400x874%2f1200x800%2ffilters%3afocal(588 x325%3a812x549)%2fcdn.vox-cdn.com%2fuploads%2fchorus_image%2fimage%2f6231475 9%2f1400x_1.0.jpg&exph=800&expw=1200&q=lime+scooters+and+cars&simid=608033326045859193&selectedIndex=0&ajaxhist=0

[percy]

TRA trading ex divie today.
Pity only 764,068 shares have been brought back,saving just $30,562.72 in dividend payment, for those shares which have now been cancelled.

[Beagle]

When is a dividend not really a dividend ? When the SP declines by the dividend amount as expected and now offered at $2.36 which will be a multi year new low when shares start changing hands. Good the company is buying some back and saving some shareholders from losing more capital.

[BlackPeter]

When is a dividend not really a dividend ? When the SP declines by the dividend amount as expected and now offered at $2.36 which will be a multi year new low when shares start changing hands. Good the company is buying some back and saving some shareholders from losing more capital.

Mmh - isn't it quite normal and to be expected for any share that the shareprice initially drops for the amount of the dividend when it goes Ex-dividend? Sure, there are some stocks who recover faster than others, but given that TRA just went Ex I am not quite sure how you can know which one it will be for TRA?

Is there a particular reason you expect TRA buyers and sellers not to consider that the share just went Ex dividend or did you just look for another reason to beat up TRA?

Lets see how the business and share price develops over the coming months and years - shall we?

[couta1]

FNZC better put a bid on on behalf of TRA as there are currently no bidders.Lol

[iceman]

And no buyers at all !

[BlackPeter]

FNZC better put a bid on on behalf of TRA as there are currently no bidders.Lol


And no buyers at all !

When a stock goes ex dividend all bids are cancelled ... standard process.

Bidders are asked to review their bids and will probably come back over the day ...

[couta1]

FNZC better put a bid on on behalf of TRA as there are currently no bidders.Lol Spoke too soon, Beagle has just put a bid on for 10k shares at $2.30, will the $2.36 seller give them up 6c cheaper.

[couta1]

When a stock goes ex dividend all bids are cancelled ... standard process.

Bidders are asked to review their bids and will probably come back over the day ... Actually there was one buyer at $2.35 at open for half an hour, we do understand standard processes BP.

[Beagle]

Spoke too soon, Beagle has just put a bid on for 10k shares at $2.30, will the $2.36 seller give them up 6c cheaper.

LOL Beagle went sniffing at the PE's of Ford, GM, Fiat Chrysler, Honda, Toyota and BMW, all trading in single digit PE's, and is pondering what smell's so badly "off" about future vehicle demand and why ? Its very hard to figure as some of these companies are flat out working on electric vehicles so why the super low price multiples and what are the implications for the PE's of Colonial Motors and Turners ?

[BlackPeter]

LOL Beagle went sniffing at the PE's of Ford, GM, Fiat Chrysler, Honda, Toyota and BMW, all trading in single digit PE's, and is pondering what smell's so badly "off" about future vehicle demand and why ? Its very hard to figure as some of these companies are flat out working on electric vehicles so why the super low price multiples and what are the implications for the PE's of Colonial Motors and Turners ?

It is true - car manufacturers command at the moment quite undemanding PE's. I follow more some European car manufacturers and the SP of e.g. Volkswagen, BMW, Daimler are roughly at 60% of a 2015 peak - despite all of them still increasing their EPS.

Not sure however whether the share price slump (most of the damage was done in 2016 and some recovery since than) has much to do with markets being afraid of technological changes - it was more due to the outfall of the diesel emmission scandals.

Markets are afraid that there are still hidden / unknown costs which the manufacturers have to pay for - this is the reason the PE's are that low. I don't see though how this would be a problem for a used car dealer and insurer / finance company like TRA (vs car manufacturers)?

It is like saying because FBU might have still a lot of hidden skeletons in their closets (they probably do) we expect that real estate agencies will underperform. People will need to buy houses no matter whether FBU has home made - and they will need to buy cars, even if the car industry still suffers from the outflow of the largest emission cheating scandal of all times

[iceman]

Actually there was one buyer at $2.35 at open for half an hour, we do understand standard processes BP.

That is true. It was mine and I had to cancel it manually. Not sure why yet !!

[percy]

It is true - car manufacturers command at the moment quite undemanding PE's. I follow more some European car manufacturers and the SP of e.g. Volkswagen, BMW, Daimler are roughly at 60% of a 2015 peak - despite all of them still increasing their EPS.

Not sure however whether the share price slump (most of the damage was done in 2016 and some recovery since than) has much to do with markets being afraid of technological changes - it was more due to the outfall of the diesel emmission scandals.

Markets are afraid that there are still hidden / unknown costs which the manufacturers have to pay for - this is the reason the PE's are that low. I don't see though how this would be a problem for a used car dealer and insurer / finance company like TRA (vs car manufacturers)?

It is like saying because FBU might have still a lot of hidden skeletons in their closets (they probably do) we expect that real estate agencies will underperform. People will need to buy houses no matter whether FBU has home made - and they will need to buy cars, even if the car industry still suffers from the outflow of the largest emission cheating scandal of all times

I have never brought a car manufacture stock.Never will.Too many variables.
However, that has never stopped me owning a car.

[Beagle]

It is true - car manufacturers command at the moment quite undemanding PE's. I follow more some European car manufacturers and the SP of e.g. Volkswagen, BMW, Daimler are roughly at 60% of a 2015 peak - despite all of them still increasing their EPS.

Not sure however whether the share price slump (most of the damage was done in 2016 and some recovery since than) has much to do with markets being afraid of technological changes - it was more due to the outfall of the diesel emmission scandals.

Markets are afraid that there are still hidden / unknown costs which the manufacturers have to pay for - this is the reason the PE's are that low. I don't see though how this would be a problem for a used car dealer and insurer / finance company like TRA (vs car manufacturers)?

It is like saying because FBU might have still a lot of hidden skeletons in their closets (they probably do) we expect that real estate agencies will underperform. People will need to buy houses no matter whether FBU has home made - and they will need to buy cars, even if the car industry still suffers from the outflow of the largest emission cheating scandal of all times
Haven't most of the manufactures already settled most of the dieselgate claims ?

[percy]

Always something for an Auto manufacturer to settle,or recall..
It's the nature of the beast.

[BlackPeter]

Haven't most of the manufactures already settled most of the dieselgate claims ?

Just recently 4 more Volkswagen managers standing in front of US courts ... and there is an ongoing political discussion in Germany about how much the car manufacturers need to contribute to upgrade their cars to the standards they claimed they comply with. That's millions of cars and several thousand Euros per car we are talking.

As well - some large court trials going on in Germany to decide whether the car manufacturers are liable to the purchasers of cars if the resale value dropped due to the non adherence of the car to emission standards.

On top of all of these troubles - some German cities with higher air pollution have been forced this winter by court proceedings to close critical routes to non complying diesel cars. This definitely cuts into the resale value of these cars ... not good if you are not allowed to use your car if you need it (e.g. to drive to work).

The fun only started ... lots of uncertainty. This is the reason one can currently buy e.g. a Daimler share with an EPS of above 8 Euros for roughly 50 Euros. Cheap as chips ... if there wouldn't be the risks.

But - as I said - not sure how any of that would impact on TRA's business - unless they might be able to source in Europe some perfectly good and cheap cars to sell in NZ - only trouble would be that the steering wheel is on the other side.

[Beagle]

Okay so we can add Daimler to the list of car manufactures selling for a PE of just over 6...cheap as chips, unlike their vehicles but its an awfully long list of car companies including Honda and Toyota, Honda in particular have never been big on diesel all trading at super low PE's. Could it be that vehicle purchases are cyclical in nature and even second hand car dealers will find in a bear market people will simply fix what they have instead of changing vehicles ? In the depths of the GFC plenty of car manufactures got down to PE's of about 5 but that's not far off where we are now.
Are the manufactures share prices a lead indicator for this bear market to resume ?
Sheeting this home to second hand cars we know December was down 6%, (from Turners announcement) which is a far bigger decline than general retail and everywhere I drive there's plenty of second hand dealers choc-a-bloc full of stock so I'm a little sceptical about accepting this downturn is because of a lack of stock from Japan. Time will tell but speaking of skepticism, doesn't it strike anyone as rather peculiar that there is almost always a very steady and plentiful supply of shares ready to sell into Turners buy-back ? Baker et al selling down ?

Finally, yes I agree most stocks going ex drop by the dividend amount on the day. What will be interesting is if this one recovers its dividend like most stocks do within a couple / few weeks.

[winner69]

What’s Tesla’s PE?

[BlackPeter]

... doesn't it strike anyone as rather peculiar that there is almost always a very steady and plentiful supply of shares ready to sell into Turners buy-back ? Baker et al selling down ?


I think you are quite aware that Baker (as director and insider) would need to announce any purchase or sell down within a few days (I think 5 days). Last announcement in that regard I remember was Baker buying a nice round additional package shortly before they announced the share buy back.

Come on, beagle - you can do better.




Finally, yes I agree most stocks going ex drop by the dividend amount on the day. What will be interesting is if this one recovers its dividend like most stocks do within a couple / few weeks.

Correct.

[Beagle]

What’s Tesla’s PE?

Ha ha, same as PPH, built on hype but battery cost reduction going forward could be more problematic than many shareholders are hoping for https://electrek.co/2017/12/13/battery-costs-stop-falling-2020-demand-electric-cars-hyundai/
Maybe some hope for Turners old clunkers for a while yet

[BlackPeter]

What’s Tesla’s PE?

LOL - They are writing a subtantial loss: their PE is around minus 50!

Good news is that their 2017 loss was still larger than their 2018 loss. Things must be all honky dory for electric cars.

[percy]

Comparing a manufacturer like Ford to Turners, is the same as comparing a Kiwi Fruit grower to your local New World.
Possibly interesting,but meaningless.
Should Ford stop producing cars today,it would have little or no affect on Turners.

[minimoke]

LOL - They are writing a substantial loss: their PE is around minus 50!

Good news is that their 2017 loss was still larger than their 2018 loss. Things must be all honky dory for electric cars.
That was on the back of laying off 9% of their staff in June last year. This year already they've announced laying off another 7%

For the virtuous thinking of buying an EV, just think about the people who have been made redundant so you can own your flash car.

[dodgy]

What’s Tesla’s PE?

The problem Tesla has is the phased removal of US subsidies which render the cars way way more expensive for most punters. In NZ large movement to electric poses charging station availability, available electricity supplies, and working out how to recover the road taxes to keep patching our roads, battery recycling/waste etc..
-d

[Baa_Baa]

Comparing a manufacturer like Ford to Turners, is the same as comparing a Kiwi Fruit grower to your local New World.
Possibly interesting,but meaningless.
Should Ford stop producing cars today,it would have little or no affect on Turners.

Absolutely agree, it's meaningless, and imo not at all interesting. Maybe some have run out of negative things to say about TRA?

[minimoke]

Oh yeah. looks like I've lost 6 cents on my shares in exchange for a 4 cent divi. Happy Days!

[couta1]

Oh yeah. looks like I've lost 6 cents on my shares in exchange for a 4 cent divi. Happy Days! I can beat that, I paper lost 65c on my shares in exchange for 8c worth of divvies.Lol

[winner69]

Oh yeah. looks like I've lost 6 cents on my shares in exchange for a 4 cent divi. Happy Days!

Don’t fret mini

Good times coming soon when the market catches on to the greatness of Turners

And another divie in a few months so no worries

[BlackPeter]

Oh yeah. looks like I've lost 6 cents on my shares in exchange for a 4 cent divi. Happy Days!

Did you?

SP used to be 240+/- 2 cents or so. They paid a 4 cent dividend (and don't forget all these imputation credits), which means all things equal SP should be now 236 +/-2 cents.

234 is within this channel.

However - I really think, if you are concerned, than you better sell ... not good holding shares you are worried about. i hear TRA is happy to take them at market off you.

[couta1]

Don’t fret mini

Good times coming soon when the market catches on to the greatness of Turners

And another divie in a few months so no worries If you worry you die, if you dont worry you still die so why worry?

[BlackPeter]

Did you?

SP used to be 240+/- 2 cents or so. They paid a 4 cent dividend (and don't forget all these imputation credits), which means all things equal SP should be now 236 +/-2 cents.

234 is within this channel.

However - I really think, if you are concerned, than you better sell ... not good holding shares you are worried about. i hear TRA is happy to take them at market off you.

... and they even closed at 235.1 (up from 234, but don't ask me, how they manage to offer or sell tenths of a cents). Still less to worry about

[winner69]

... and they even closed at 235.1 (up from 234, but don't ask me, how they manage to offer or sell tenths of a cents). Still less to worry about

That after hours off market trade doesn’t count ...close was 234

The 235.1 was probably some deal at vwap or something

[couta1]

That after hours off market trade doesn’t count ...close was 234

The 235.1 was probably some deal at vwap or something VWAP was $235.54, that's the one to use.PS- Must be a boring day when TRA is the most discussed share.Lol

[minimoke]

However - I really think, if you are concerned, than you better sell ... not good holding shares you are worried about. i hear TRA is happy to take them at market off you.If you can point me to a share that is all moonbeams and fairy dust I'll sell my TRA and buy.


In the mean time I accept that not all shares behave as you would like them to.

[winner69]

When do I get my dividend?

[couta1]

When do I get my dividend? In 8 sleeps from now.

[winner69]

In 8 sleeps from now.

Jeez that’s next week

Gives me time to think no about what present I can buy myself ......could get used to buying myself something special every few months

As long as I never sell the shares haven’t lost anything have I ...but would rather see a share price of $3.80

[winner69]

I wish Turners would stop paying divies so regularly

All it seems to do is trigger a further fall in the share price

[BlackPeter]

I wish Turners would stop paying divies so regularly

All it seems to do is trigger a further fall in the share price

Always look for the bright side: You could use your divvies to buy more TRA shares, resulting in still more divvies next time and more shares you could buy. Rinse and repeat. As soon as you accumulated this way more than 50% you could take over the board and change the dividend policy as you please.

[Snow Leopard]

Just noticed that the dividend now comes with a supplementary for Snow Leopards (& others)

Last October was the first instance of this.

Have put TRA on my list of accounts to read if I have the time.

[rainey]

Never quite come to grips with these share buybacks, surely the money could be put to better use like expansion or reducing debt or some other innovative scheme

[couta1]

They need to get their skates on with this buyback, they only bought 2830 shares back yesterday and I bought 10000.Lol

[winner69]

They need to get their skates on with this buyback, they only bought 2830 shares back yesterday and I bought 10000.Lol

Good on you Couts for holding the share price up

Needs all the help it can get

[winner69]

Jeez, the decline continues. shareprice down to 233 yesterday (in spite of Couts and Turner buying)

Long wait until May before it becomes more clear if the strategy of clipping the ticket is working. Market saying it’s a failed strategy....maybe not the strategy but inept execution by a not very impressive management team.

I’ll hang in their hoping Baker and his Singapore mate find a greater fool to buy this company or if that fails i’ll live in hope that Baker et al will think it’s so so cheap they themselves will buy the company out.

Hope it’s a decent get out of jail free card but at this rate maybe not.

[couta1]

Jeez, the decline continues. shareprice down to 233 yesterday (in spite of Couts and Turner buying)

Long wait until May before it becomes more clear if the strategy of clipping the ticket is working. Market saying it’s a failed strategy....maybe not the strategy but inept execution by a not very impressive management team.

I’ll hang in their hoping Baker and his Singapore mate find a greater fool to buy this company or if that fails i’ll live in hope that Baker et al will think it’s so so cheap they themselves will buy the company out.

Hope it’s a decent get out of jail free card but at this rate maybe not. HaHa that's the problem winner neither Couts or Turner's were buying yesterday.Lol

[percy]

I was talking to an old motor racing friend yesterday.
He was telling me how he rang into an old mate of his.Worked at Turners for years,then went to Australia and furthered his career,learning auctioneering.
Spoke very highly of him.
This guy is now in charge of Turners' Classic Cars in ChCh.
So not only do Turners attract great staff,they retain them.

[winner69]

HaHa that's the problem winner neither Couts or Turner's were buying yesterday.Lol

Couts and Turners has a nice ring to it ...or should it be Turners and Couts

So it seems that without Couts and Turner doing their thing lately the share price might have been sub $2

[BlackPeter]

Couts and Turners has a nice ring to it ...or should it be Turners and Couts

So it seems that without Couts and Turner doing their thing lately the share price might have been sub $2

Are you buying ;)?

[Beagle]

1027710277

A lot of people, (myself included), have had a very expensive lesson in why one shouldn't bother fighting TA.

[couta1]

1027710277

A lot of people, (myself included), have had a very expensive lesson in why one shouldn't bother fighting TA. Lovely ski slope, c'mon Beagle get those skis on and get amongst it.

[BlackPeter]

Quite right - with 20/20 hindsight it was quite stupid not to sell, and my ability to forecast our now common hindsight was as bad as everybody elses.

Problem is - past performance is no indicator for the future ... so - where do you recon the SP will be in 2 years from now? Is the further down risk larger than the upside opportunities?

I think the sales proposition for the NZ used vehicle market will midterm improve - Who will want to buy now a new car with combustion engine if they can have a new cheap electric car in a decade from now and their now new combusty would be unsaleable by then? God used car is at the moment the way to go until we see how the electric car market plays out.

Open question is - what proportion of this marketshare will Turners be able to take? If they play their cards well they should be quite well positioned ...

[Beagle]

Yeah, NAH, might just sit in the café sipping latte's until the ski lift starts working again :) https://www.bing.com/images/search?view=detailV2&ccid=GuzPC9rT&id=243367290C4264967987F68339A6817A7B2B99BA&thid=OIP.GuzPC9rTfSo60vEOrM_PnAHaFK&mediaurl=http%3a%2f%2fn7.alamy.com%2fzooms%2fcb5e5 41dc8ee422493f94725fe485deb%2flunch-on-the-terrace-at-coronet-peak-ski-area-queenstown-south-island-b8m7xx.jpg&exph=446&expw=640&q=picture+of+coronet+ski+cafe&simid=608004124558232959&selectedIndex=7&ajaxhist=0

[janner]

Yeah, NAH, might just sit in the café sipping latte's until the ski lift starts working again :) https://www.bing.com/images/search?view=detailV2&ccid=GuzPC9rT&id=243367290C4264967987F68339A6817A7B2B99BA&thid=OIP.GuzPC9rTfSo60vEOrM_PnAHaFK&mediaurl=http%3a%2f%2fn7.alamy.com%2fzooms%2fcb5e5 41dc8ee422493f94725fe485deb%2flunch-on-the-terrace-at-coronet-peak-ski-area-queenstown-south-island-b8m7xx.jpg&exph=446&expw=640&q=picture+of+coronet+ski+cafe&simid=608004124558232959&selectedIndex=7&ajaxhist=0

Must agree with you.
Was out a tad over 2 years ago at a small lose.
Have not seen any reason to jump back in.
Despite Percy's glowing posts.

[percy]

I was talking to an old motor racing friend yesterday.
He was telling me how he rang into an old mate of his.Worked at Turners for years,then went to Australia and furthered his career,learning auctioneering.
Spoke very highly of him.
This guy is now in charge of Turners' Classic Cars in ChCh.
So not only do Turners attract great staff,they retain them.

Should have added a ps.
Any car enthusiast visiting ChCh should make a trip to,Dutton Garage NZ,148 Carlyle Street,Sydenham.
Google Dutton Garage, and you will get an idea of the fantastic classics they have for sale.
Most of their stock is brought by collectors,and I guess if classic cars are exempt from capital gains tax ,they will be going gang busters.[as will Turners' classic car division].

[couta1]

Yeah, NAH, might just sit in the café sipping latte's until the ski lift starts working again :) https://www.bing.com/images/search?view=detailV2&ccid=GuzPC9rT&id=243367290C4264967987F68339A6817A7B2B99BA&thid=OIP.GuzPC9rTfSo60vEOrM_PnAHaFK&mediaurl=http%3a%2f%2fn7.alamy.com%2fzooms%2fcb5e5 41dc8ee422493f94725fe485deb%2flunch-on-the-terrace-at-coronet-peak-ski-area-queenstown-south-island-b8m7xx.jpg&exph=446&expw=640&q=picture+of+coronet+ski+cafe&simid=608004124558232959&selectedIndex=7&ajaxhist=0 Beagle you just have to get better at multi tasking, I can teach you how to trade shares whilst riding the chairlift sipping on a latte at the same time.

[Beagle]

Quite right - with 20/20 hindsight it was quite stupid not to sell, and my ability to forecast our now common hindsight was as bad as everybody elses. TA on this one has humbled a lot of people other than the one who keeps posting glowing remarks on the company's prospects

Problem is - past performance is no indicator for the future ... so - where do you recon the SP will be in 2 years from now? Is the further down risk larger than the upside opportunities? A lot depends upon where the economy goes...car companies are cyclical...but why risk it with TA clearly showing no reason to be invested ?

I think the sales proposition for the NZ used vehicle market will midterm improve - Who will want to buy now a new car with combustion engine if they can have a new cheap electric car in a decade from now and their now new combusty would be unsaleable by then? God used car is at the moment the way to go until we see how the electric car market plays out.What on earth makes you think new electric cars will be cheap in 10 years time ?

Open question is - what proportion of this marketshare will Turners be able to take? If they play their cards well they should be quite well positioned ...

Perhaps the real question is will the market dominance of Trade Me continue to grow and how much market share will it take from traditional car dealers ?

LOL Couta1 - too funny.

[BlackPeter]

What on earth makes you think new electric cars will be cheap in 10 years time ?




Electrical vehicles are cheaper to produce (if produced in comparable volumes to vehicles with combustion engine), much cheaper to drive (cost of fuel) and much cheaper to maintain. Only reason for them to be still more expensive are still low volumes and battery costs - and battery cost come down every year.

Obviously - I don't know exactly when the electric car will be cheaper than a comparable ride on the combustion engine, but if history is a guide - it took roughly 20 years for in commercial quantities produced vehicles with combustion engine to replace horse and cart - and (in volumes produced) electrical vehicles are already around for two decades ...

[winner69]

Quite right - with 20/20 hindsight it was quite stupid not to sell, and my ability to forecast our now common hindsight was as bad as everybody elses.

Problem is - past performance is no indicator for the future ... so - where do you recon the SP will be in 2 years from now? Is the further down risk larger than the upside opportunities?

I think the sales proposition for the NZ used vehicle market will midterm improve - Who will want to buy now a new car with combustion engine if they can have a new cheap electric car in a decade from now and their now new combusty would be unsaleable by then? God used car is at the moment the way to go until we see how the electric car market plays out.

Open question is - what proportion of this marketshare will Turners be able to take? If they play their cards well they should be quite well positioned ...

All good stuff BP but you don’t mention execution risk (and that’s assuming strategy is robust)

Heck you have to think something is really wrong sonewhere - either the much touted ‘strategy’ is irrelevant or management (execution) is abysmal

Look at half performance across the business. Operating Profit by business -

- Automotive Retail DOWN 9%
- Finance DOWN 2%
- Collections DOWN 10%
- Insurance UP 14% plus property gain

And then they signal second half could be worse ...bloody heck

And the delusional Board thinks it share price should be north of $3

Company performance not reconciling with words / hype etc = declining share price

That’s how I see it anyway

[percy]

[QUOTE=Beagle;745013]Perhaps the real question is will the market dominance of Trade Me continue to grow and how much market share will it take from traditional car dealers ?

Perhaps the answer is the tradional car dealers are the major beneficiaries of Trade Me.
Just another chanel Turners use to grow their market share.

[Beagle]

Electrical vehicles are cheaper to produce (if produced in comparable volumes to vehicles with combustion engine), much cheaper to drive (cost of fuel) and much cheaper to maintain. Only reason for them to be still more expensive are still low volumes and battery costs - and battery cost come down every year.

Obviously - I don't know exactly when the electric car will be cheaper than a comparable ride on the combustion engine, but if history is a guide - it took roughly 20 years for in commercial quantities produced vehicles with combustion engine to replace horse and cart - and (in volumes produced) electrical vehicles are already around for two decades ...

Head of the giant Volkswagen group who currently produce EV's disagrees with you saying EV's will probably always be more expensive https://www.autocar.co.nz/autocar-news-app/entry-level-evs-won-t-be-so-affordable-according-to-vw
and Hyundai who also currently produce a number of EV's also disagrees https://insideevs.com/hyundai-exec-thinks-electric-car-battery-prices-will-stop-declining-in-2020/

One thing I will agree with you on Percy is this. Turners is a quick and easy place to sell your vehicle, (no need to trade it in with a dealer as part of a dealer to dealer exchange), for those that choose to buy on Trade Me. Now that Trade Me has partnered with MTF to provide finance and Turners is such an easy place to sell one's old vehicle it is very easy to cut out the traditional dealer model so the market is wide open to low cost operators and private sellers.

[percy]

One thing I will agree with you on Percy is this. Turners is a quick and easy place to sell your vehicle, (no need to trade it in with a dealer as part of a dealer to dealer exchange), for those that choose to buy on Trade Me. Now that Trade Me has partnered with MTF to provide finance and Turners is such an easy place to sell one's old vehicle it is very easy to cut out the traditional dealer model so the market is wide open to low cost operators and private sellers.[/QUOTE]

Yes selling their vehicle to Turners is proving very quick and easy for a great number of people and helps to account for Turners statement they are sourcing more cars in NZ.
Even easier is selling your car to Turners and buying your replacement car from them,using their helpful staff, who will arrange finance and insurance as well.
Private sellers/backyard dealers.Reminds me when I worked at Hutchinson Motors over 50 years ago, the best car dealers were a couple of guys who worked in the parts dept.We had a morning and an evening paper in those days.Every Saturday evening's paper one would advertise a Ford Anglia for sale.Very few details.This was because he relied on buying one to sell on Saturday morning.!!..And he often brought and sold two.!!...lol.

[whatsup]

One thing I will agree with you on Percy is this. Turners is a quick and easy place to sell your vehicle, (no need to trade it in with a dealer as part of a dealer to dealer exchange), for those that choose to buy on Trade Me. Now that Trade Me has partnered with MTF to provide finance and Turners is such an easy place to sell one's old vehicle it is very easy to cut out the traditional dealer model so the market is wide open to low cost operators and private sellers.

Yes selling their vehicle to Turners is proving very quick and easy for a great number of people and helps to account for Turners statement they are sourcing more cars in NZ.
Even easier is selling your car to Turners and buying your replacement car from them,using their helpful staff, who will arrange finance and insurance as well.
Private sellers/backyard dealers.Reminds me when I worked at Hutchinson Motors over 50 years ago, the best car dealers were a couple of guys who worked in the parts dept.We had a morning and an evening paper in those days.Every Saturday evening's paper one would advertise a Ford Anglia for sale.Very few details.This was because he relied on buying one to sell on Saturday morning.!!..And he often brought and sold two.!!...lol.[/QUOTE]

Yeh some of those car dealers were wizzes, reminds me of the time I was selling a car, had it in the Herald for a while when the phone went some 10 days after my last add and would you believe a dealer wanted to buy it, I thought I as lucky until I caught on , they went through the cars for sale adds only after they were 10 days old, needless to say we didn't do a deal at his price.

[percy]

I bet the dealer scored many giveaways.!!!
Another story from Hutchinson Motors.
The sales manager told me Hutchinson Motors had so many Ford Prefects to sell in 1951 or 52 he learnt a good trick.Ring clients on the waiting list and tell them they had "a window of opportunity" to buy a new Prefect,either a blue one or a red one,but they had to let him know before 10am tomorrow morning.
They had Prefects of every colour.
Sold all the Prefects in record time.
Too many choices, and too long a time to decide,meant to many "I will think about" its.

ps.
Worked for me a good few years later when I went selling Lyttelton calendars business to business in Lyttelton.
Offer them a choice of two and often they brought both,offer a choice of three or more, confussed them, and they brought none.!!

[percy]

Talking of car dealers making up stories did you hear about that car dealer who says they are going to improve
Gra��t Baker ��o����e��ted: ��The Board believes the purchase of company shares, which are priced significantly below their intrinsic value, is an appropriate use of capital and will be of benefit to shareholders. We are confident in the long term prospects for solid and improving group earnings resulting in increasing balance sheet strength. This positive outlook supports the Share Buyback initiative��

I am in total agreement with the board.

ps.I think the board is made up more of finance/insurance/accountant/ people.No ex car dealers.[unfortunately]

pps.Keep an eye out for the following book when you are next at the dump:"Billiionaire;The Life and Times of Sir James Goldsmith".May alter your time frame for a good business model producing results.Sir James thought in years, rather than days and weeks [much like Warren Buffett] .The chapter on Cavendish Foods in particular.

[BlackPeter]

Head of the giant Volkswagen group who currently produce EV's disagrees with you saying EV's will probably always be more expensive https://www.autocar.co.nz/autocar-news-app/entry-level-evs-won-t-be-so-affordable-according-to-vw
and Hyundai who also currently produce a number of EV's also disagrees https://insideevs.com/hyundai-exec-thinks-electric-car-battery-prices-will-stop-declining-in-2020/

One thing I will agree with you on Percy is this. Turners is a quick and easy place to sell your vehicle, (no need to trade it in with a dealer as part of a dealer to dealer exchange), for those that choose to buy on Trade Me. Now that Trade Me has partnered with MTF to provide finance and Turners is such an easy place to sell one's old vehicle it is very easy to cut out the traditional dealer model so the market is wide open to low cost operators and private sellers.

Actually - both of them might have a vested interest to "manage expectations" to prevent people from believing that EV's might soon be cheaper. Both sell nearly exclusively cars with combustion engines which will fast loose value if & when EV's are cheaper.

Predicting what battery prices will do after 2020 is like predicting the 2021 summer - or forecasting the oil price in three years from now. While increased demand might be one fact pushing prices up - nobody knows what the supply side will do. Typically increased demand means increased supply. As well - batteries are particularly suitable for recycling ... i.e. we need to mine all these amazing elements only once and can use them again and again.

[Beagle]

Maybe...but Tesla also recently admitted they are struggling to lower their costs despite their giga battery factories. May never be able to supply their base model Model 3 for $US35,000 which would still retail here with freight and GST at over $N.Z60,000 even if they can make it for that price.

I agree that its difficult to predict the long term price of electric batteries but those manufactures as well as Tesla all singing a very similar tune doesn't auger well for your core contention of cheap electric cars within a decade.

Apparently 40% of the world's cobalt (an essential ingredient in car batteries) comes from the Congo.
You would hope they can recycle it with what's going on...https://www.dailymail.co.uk/news/article-4764208/Child-miners-aged-four-living-hell-Earth.html

[winner69]

Hope Turners haven’t been ‘clipping the ticket’ too aggressively and the watch dog names them

Life insurance only a small part of the business but outfits like Consumer saying the whole insurance industry needs to pull their socks maybe some risk to Turners here

https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12197976

Jeez used car salesmen and dodgy insurance salesmen .....what a world we life in

[percy]

Hope Turners haven’t been ‘clipping the ticket’ too aggressively and the watch dog names them

Life insurance only a small part of the business but outfits like Consumer saying the whole insurance industry needs to pull their socks maybe some risk to Turners here

https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12197976

Jeez used car salesmen and dodgy insurance salesmen .....what a world we life in

As far as I can remember Turners do not sell life insurance.
They are agents only for motor vehicle insurance.[small ticket]
They own "Autosure" which sells warrantees for motor vehicles.[large ticket]
As ChCh home owners found some insurance companies are excellent,while others are worse than dodgy.
ps.Any one who has read the history of Llyods of London will know just how dodgy insurance can be.
Insurance is excellent when you need it,expensive when you don't,and extremely expensive when you don't have it.
I think banks have learnt they made mistakes selling "the wrong" polices to customers, as they did not consider their customers' needs.[was disgraceful]

[blackcap]

Hope Turners haven’t been ‘clipping the ticket’ too aggressively and the watch dog names them

Life insurance only a small part of the business but outfits like Consumer saying the whole insurance industry needs to pull their socks maybe some risk to Turners here

https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12197976

Jeez used car salesmen and dodgy insurance salesmen .....what a world we life in

Bit of a worry there winner. If Turners cannot even make normal profits with aggressive ticket clipping, one wonders what will happen if the FMA get stuck in.

Thankfully Percy to the rescue in 3, 2, 1....

[percy]

Divie due today...
Next one three months away.
Love these quarterly paid fully imputed divies.

[winner69]

Turners have some life insurance liabilities on their balance sheet ....whatever that is

And even some reverse mortgage stuff as well

[percy]

Turners have some life insurance liabilities on their balance sheet ....whatever that is

And even some reverse mortgage stuff as well

Life policies most probably left overs from Dorcester Pacific days.
They have been unwinding RELs letting them run their course.Were used in part of their insurance capital requirements.
Guess insurance capital requirements are now meet with Turners property ownership/developements.[Much more profitable too.]

[couta1]

Divie due today...
Next one three months away.
Love these quarterly paid fully imputed divies. In bank already, just need another 15 like that to break even.Lol

[winner69]

In bank already, just need another 15 like that to break even.Lol

Must check

I’ll give Baker a ring and suggest weekly divies

You’d think a ‘clipping the ticket’ strategy could cope with that ...or they could just borrow a bit more

[Snoopy]

Must check

I’ll give Baker a ring and suggest weekly divies

You’d think a ‘clipping the ticket’ strategy could cope with that ...

That sounds like a strategy for the super patient. It is the digital age now and there is no reason why each individual car sale can't be put on a database in real time. It is only one step then to derive the profit from each sale and reward shareholders with a consummate micro-dividend worth fractions of a cent on each sale. Then you guys could sit glued to your internet bank accounts, potentially watching hundreds of TRA dividends come in per day.....

SNOOPY

[percy]

That sounds like a strategy for the super patient. It is the digital age now and there is no reason why each individual car sale can't be put on a database in real time. It is only one step then to derive the profit from each sale and reward shareholders with a consummate micro-dividend worth fractions of a cent on each sale. Then you guys could sit glued to your internet bank accounts, potentially watching hundreds of TRA dividends come in per day.....

SNOOPY

You have a point.
A few months ago I had Turners ads poping up all the time saying "Since you last looked Turners have brought another 100 cars."
I did suggest to Todd, shareholders would much prefer "Since you last looked Turners have SOLD another 100 cars."!!..lol.

[couta1]

Plenty of sellers behind the scenes at $2.33, none have been offered up at this price on the sell line.

[Mickey]

Plenty of sellers behind the scenes at $2.33, none have been offered up at this price on the sell line.
Yeah, I find it interesting that it is all happening behind the scenes too. That transaction of 180,000 was even more interesting.

[couta1]

Yeah, I find it interesting that it is all happening behind the scenes too. That transaction of 180,000 was even more interesting. No sp beside trade so was not done off market but rather in house by FNZC.

[blackcap]

No sp beside trade so was not done off market but rather in house by FNZC.

How do you know it was FNZN couta1? Or are you on one side of the trade? :)

[couta1]

How do you know it was FNZN couta1? Or are you on one side of the trade? :) Seemed logical since they are buying the shares back on market on behalf of TRA.

[blackcap]

Seemed logical since they are buying the shares back on market on behalf of TRA.

I doubt they would be buying 180,000 in one chunk. That said, lets wait till tomorrow to see how many they bought back. I'm pretty sure its not part of the buyback. Total volume today is about 274K shares. They do not want to buy more than about 1/4 or 1/3 of daily volume.

That said it might still be FNZN or any other broker, but for a client and not TRA.

[winner69]

Baker topping up .....FNZC found a buyer for him

Just speculation

[blackcap]

Baker topping up .....FNZC found a buyer for him

Just speculation

Well his dividend did come in today so he will have the $.

[blackcap]

Couta1,

Seems you were right and I was wrong. Good call. Good to see FNZC keeping them on their toes so to speak.

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/TRA/329983/294245.pdf


I forgot about this rule and thought it was daily but I see it is weekly, so there can be aberrations from the 30% on a daily basis: "it is intended that the purchases by Turners over a one week period will not exceed 30% of the volume of Shares traded over that one week period."

[BlackPeter]

Couta1,

Seems you were right and I was wrong. Good call. Good to see FNZC keeping them on their toes so to speak.

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/TRA/329983/294245.pdf


I forgot about this rule and thought it was daily but I see it is weekly, so there can be aberrations from the 30% on a daily basis: "it is intended that the purchases by Turners over a one week period will not exceed 30% of the volume of Shares traded over that one week period."

So - they roughly bought the first million shares back. Another 3.5 to go. Will be interesting to see how the market behaves when the buyback finishes, but maybe we have some good news until then ...

[blackcap]

So - they roughly bought the first million shares back. Another 3.5 to go. Will be interesting to see how the market behaves when the buyback finishes, but maybe we have some good news until then ...

Lets hope so. Because a million shares for this company is not a small amount of volume and the SP has still steadily been dropping. So post the buy back.... bit of a worry. That said, a company will always be attractive at a certain price. So the sellers will have to stop selling if the price gets too low (barring further negative news)

[percy]

So - they roughly bought the first million shares back. Another 3.5 to go. Will be interesting to see how the market behaves when the buyback finishes, but maybe we have some good news until then ...

Just over a mil,1,044.993.

[winner69]

Hopefully punters have decided to go the second hand car way

NZ NEW VEHICLE REGISTRATIONS FALL IN JANUARY AS MARKET SOFTENS

http://www.sharechat.co.nz/article/daf64083/nz-new-vehicle-registrations-fall-in-january-as-market-softens.html?utm_medium=email&utm_campaign=NZ%20new%20vehicle%20registrations%20 fall%20in%20January%20as%20market%20softens&utm_content=NZ%20new%20vehicle%20registrations%20f all%20in%20January%20as%20market%20softens+CID_14a 245dfc04da262466c69a174afd7d7&utm_source=Email%20marketing%20software&utm_term=httpwwwsharechatconzarticledaf64083nz-new-vehicle-registrations-fall-in-january-as-market-softenshtml

Who’d buy a new car anyway seeing they only go 800km before seizing up.

[couta1]

Hopefully punters have decided to go the second hand car way

NZ NEW VEHICLE REGISTRATIONS FALL IN JANUARY AS MARKET SOFTENS

http://www.sharechat.co.nz/article/daf64083/nz-new-vehicle-registrations-fall-in-january-as-market-softens.html?utm_medium=email&utm_campaign=NZ%20new%20vehicle%20registrations%20 fall%20in%20January%20as%20market%20softens&utm_content=NZ%20new%20vehicle%20registrations%20f all%20in%20January%20as%20market%20softens+CID_14a 245dfc04da262466c69a174afd7d7&utm_source=Email%20marketing%20software&utm_term=httpwwwsharechatconzarticledaf64083nz-new-vehicle-registrations-fall-in-january-as-market-softenshtml

Who’d buy a new car anyway seeing they only go 800km before seizing up. My 1994 Suzuki Vitara(Petrol) now at 325000k, never had any engine work and has been taken just about everywhere.

[Beagle]

Hopefully punters have decided to go the second hand car way

NZ NEW VEHICLE REGISTRATIONS FALL IN JANUARY AS MARKET SOFTENS

http://www.sharechat.co.nz/article/daf64083/nz-new-vehicle-registrations-fall-in-january-as-market-softens.html?utm_medium=email&utm_campaign=NZ%20new%20vehicle%20registrations%20 fall%20in%20January%20as%20market%20softens&utm_content=NZ%20new%20vehicle%20registrations%20f all%20in%20January%20as%20market%20softens+CID_14a 245dfc04da262466c69a174afd7d7&utm_source=Email%20marketing%20software&utm_term=httpwwwsharechatconzarticledaf64083nz-new-vehicle-registrations-fall-in-january-as-market-softenshtml

Who’d buy a new car anyway seeing they only go 800km before seizing up.

LOL Not all of them mate...this is a first for me, never had anything remotely similar happen in 40 years of buying cars. Wonder what the crash rating is on Couta1's old Suzuki ? He's a top bloke, hope he doesn't get hit in that by some errant driver :eek2:

[couta1]

Over 400k shares bought at $2.33 and no end in sight of that line being reloaded for sale at that price, I wonder who the big seller/sellers are?

[percy]

I remain surprised there have been no shareholder notices,other than the buyback,for months.
I think SeeWeed must be the big buyer, if it is not you.?.lol.

[percy]

Yesterday 452,590 TRA shares were traded,of which 85% or 385,322 were brought back.

Appears the 30% of weekly traded shares only,is no longer in place.?

Since going xd 1,201,247 have been brought back,taking the total number to 1,965,315.

[winner69]

Yesterday 452,590 TRA shares were traded,of which 85% or 385,322 were brought back.

Appears the 30% of weekly traded shares only,is no longer in place.?

Since going xd 1,201,247 have been brought back,taking the total number to 1,965,315.

Just as well they are buying that many .....esp if the sellers are keen

Maybe the seller is snoops getting cash for his heartland foray

[Beagle]

Over 400k shares bought at $2.33 and no end in sight of that line being reloaded for sale at that price, I wonder who the big seller/sellers are?

By all appearances it would seem there is an almost unlimited supply of stock that keeps getting loaded on the sale side at $2.33. Somebody knows something we don't...never trust a car dealer.

[percy]

Well the car dealer I saw at their presentation has not sold any.

[BlackPeter]

By all appearances it would seem there is an almost unlimited supply of stock that keeps getting loaded on the sale side at $2.33. Somebody knows something we don't...never trust a car dealer.

Sure - interesting volume, though momentum seems to pull back. But just wondering - if it would be the car dealer selling - shouldn't we see some SSH notices?

Not sure what to make out of all of this - people do need cars to stay mobile in a country like ours, no matter what the market conditions. Not to replace a car is seldom an option ... and if consumer confidence is dropping, than even more people should look for a used car (instead of buying a new one).

Obviously - an increasing number of people not able of paying back their car loan would hurt ... but as long as unemployment rate is under control (at this stage it is, even if it went up last quarter) and as long as wages go up I don't see a big killer in that regard.

Maybe we should take on Todd's offer to have a webinar on the conditions in the second hand car market?

In my view the second hand car market in NZ should continue to do well. If Turners does not, than this would be for some home made reason, which I can't see at this stage.

But maybe this is all just a cunning strategy to keep the SP during the share buy back phase down - I guess what better outcome could there be for the remaining shareholders? We are basically buying back the shares we sold late last year in the $2.80 ies (bond conversion) for $2.33 a piece. Now, this is clever.

[winner69]

Beagle I have done some digging to find out what constitute attending meetings for directors at this company.
It appears that it is considered that a meeting is attended if a director has anticipated in any form no matter how minor.
Personally I would consider a director attend a meeting if he has prepared for the meeting and participate in person so a healthy discussion of minds with fellow directors can take part.
However in TRA case a director is considered having taken part if he has video conferenced in, conferenced called even if only part of the meeting or wait even if he has e-mailed a suggestion or opinion.
As I have mentioned before the work culture of directors in this company seems lacking motivation. If the motivation is not optimum at the top level one has to wonder how it is at the rest of the company.

And Annual Report says 12 Board meetings and Baker only attended 9

What a slacker

[forest]

And Annual Report says 12 Board meetings and Baker only attended 9

What a slacker

Exactly my point, I have great respect for people like Snoopy, Percy and many others on this forum who carry out a lot of good research.
But one has to remember if motivation to work wanes at the top the financial results are likely to wane in the future.

[Beagle]

Beagle I have done some digging to find out what constitute attending meetings for directors at this company.
It appears that it is considered that a meeting is attended if a director has anticipated in any form no matter how minor.
Personally I would consider a director attend a meeting if he has prepared for the meeting and participate in person so a healthy discussion of minds with fellow directors can take part.
However in TRA case a director is considered having taken part if he has video conferenced in, conferenced called even if only part of the meeting or wait even if he has e-mailed a suggestion or opinion.
As I have mentioned before the work culture of directors in this company seems lacking motivation. If the motivation is not optimum at the top level one has to wonder how it is at the rest of the company.

Thanks forest...I find that more than a little concerning. As I have mentioned several times before I did not "buy" Bakers excuse for not attending the annual meeting and the deputy chair looked really flustered which suggest to me Baker's call not to attend was a last minute decision. I thought their demand for a big directors fee increase and discussion about it during the meeting...I found their attitude to be one of "entitlement" bordering on arrogance...you know...like a Chairman not attending because he's not legally required to do so. I still have some of these for my Mum for her retirement income portfolio and they're in my name in Trust for her so I am planning on being at next years annual meeting for another full on barking session.

[couta1]

I reckon everything but Armageddon is basically baked into the current SP.

[BlackCross]

https://www.newsroom.co.nz/2018/11/27/339410/whos-telling-porkies-about-car-sales

Nov 27th 18

Turners Automotive Group says it had a dreadful October and, that if those conditions continue, its annual pre-tax profit could be down 5-10 percent on its guidance.
The downturn has been bigger in Auckland and “we think it’s a cost of living pressure,” says chief executive Todd Hunter.
Rising fuel costs, in particular, haven’t helped.
Turners sells used cars and it says sales of imported used cars into New Zealand fell 8.6 percent in the six months ended September while sales of imports into Auckland fell 12 percent.
Hunter says that trend has continued through October and has been exacerbated by stink bug mitigation – from Sept. 1, all used vehicle imports have had to be treated to kill any bugs, adding $250 to each vehicle’s landing costs – and by the compulsory Takata airbag recall affecting 50,000 vehicles...and more ........

[BlackPeter]

Well yes, but not quite news - isn't it? This information brought the market (rightly or wrongly) down to a low of $2.46 on November 28th. Since than fuel prices were significantly dropping and consumer confidence was rising (https://www.anz.co.nz/resources/d/0/d0eeb110-5465-4f96-9a92-28aba9aa2a7b/ANZ-ConsumerConfidence-20190201.pdf). So, what is really happening?

[Beagle]

Well yes, but not quite news - isn't it? This information brought the market (rightly or wrongly) down to a low of $2.46 on November 28th. Since than fuel prices were significantly dropping and consumer confidence was rising (https://www.anz.co.nz/resources/d/0/d0eeb110-5465-4f96-9a92-28aba9aa2a7b/ANZ-ConsumerConfidence-20190201.pdf). So, what is really happening?

Yes fuel prices have come down but anecdotally it would appear that right across the board consumers showed an inclination towards very modest spending this Christmas.
Insiders will already know how things have gone since then. They will know November, December and January sales information.

[percy]

Top 20 share holders as at 30/11/2018.....................................as at 31/1/2019
NZCSD..............23,786,504..................... ...................................21,874,890..... ..............................-1,911,614
Bartel.................9,552,642.................. ........................................same.
Montzemolo.........6,000,000...................... ...................................6,100,000.... +100,000
Harrigen..............5,179,294................... ........................................same
FNZC...................4,881,497.................. .........................................same
JBWere................2,665.717................... ......................................2,680,717... ....+15,000
P Byrnes..............2,414,860..................... .......................................same
S Sinclair.............2,171,461.................... .........................................same
J.Harrison.............1,588.782.................. ...........................................same
P Mora..................1,586,339................... ..........................................same
Custodial................588,388.................. ...........................................531,321 ...................................-57,067
CM Smithies...........542,841........................ ......................................same
J Thomson..............519,754...................... ........................................same
Ace Finance.............324,966....................... .......................................same
Michael Daniel..........300,000........................... ...................................same
Leveraged..................Nil.................... ................................................31 5,655.....+315,655
BSpeers...................299,357................. ...............................................Nil ...........................................-299,357
Forbar......................290,438............... ................................................29 8,101.....+7663
CRBall.......................283,071.............. ................................................sa me.

So 4 of the top 20 shareholders have sold down,1 of whom is no longer a top 20 holder,3 have increased their holding,and we have 1 new shareholder in the top 20.
13 have neither brought or sold.
The NZCSD seller of 1,911,614 is most probably a fund manager who owned less than 5%.
The only top 20 shareholder who sold out held 299,357 B Speers.

[Snoopy]

The only top 20 shareholder who sold out held 299,357 B Speers.


Nice work Percy. Should Brittany Speers selling out be of any concern to those of us that are left?

SNOOPY

[percy]

Wrong again.//??.lol.
Bruce Gregory SPEERS and Fioranto Trust Ltd [BGV Investment]
Most probably had to pay for a new deck.
I think he had something to do with Fastway Couriers.

ps.I will leave it a month and then ask my broker for an updated TRA top 100 list.

[Beagle]

Wrong again.//??.lol.
Bruce Gregory SPEERS and Fioranto Trust Ltd [BGV Investment]
Most probably had to pay for a new deck.
I think he had something to do with Fastway Couriers.

ps.I will leave it a month and then ask my broker for an updated TRA top 100 list.

Something is terribly wrong with that top 20 list Percy, your name isn't on it :p

[couta1]

Something is terribly wrong with that top 20 list Percy, your name isn't on it :p That's why he wants the Top 100 list. PS-I should be on that one as well.

[percy]

That's why he wants the Top 100 list. PS-I should be on that one as well.

If your initials are MJW you are No.53 just under Todd Hunter.

Yes I am in the top 100,as is my partner who just makes the list.

[Joshuatree]

I dont quite make the list.Do they put out a top 1,000 list:(. Would be really cool to bracket it with my 34,000 cc Kawasaki widow maker, My sunblock 750, my #400 use cocktail blender and my collection of 5639 aluminium drink cans that i havnt crushed yet and My 1309 Premium OtagoBlack cherry pits that ive spittooned over summer. Be Really cool to make a list.

TGIF

[Beagle]

I dont quite make the list.Do they put out a top 1,000 list:(.
TGIF
Congrats, means you've lost a lot less than most others over the last 2 years. Be happy !

[winner69]

Milford crystallising some of their losses with Turners
http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/TRA/330509/294850.pdf

[BlackPeter]

Hmm - so they bought over the last 12 monhs or so at an average of $2.86 and sold at an average of $2.40.

Question is - did they buy too dear or did they sell too cheap? Whatever it is - their analysis does not seem to be impeccable ...

Anyway - explains the volume we saw over the recent weeks. Problem is - they are still holding more than 5% - more shares than TRA said it will buy back.

[percy]

Milford crystallising some of their losses with Turners
http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/TRA/330509/294850.pdf

Will be interesting to see whether they continue to "Crystallise" further losses.?

[sb9]

Will be interesting to see whether they continue to "Crystallise" further losses.?

Code for depressed sp for a while...

[percy]

Code for depressed sp for a while...

Certainly will be should they decide to sell the 6,020,821 they still own.

[sb9]

Certainly will be should they decide to sell the 6,020,821 they still own.

Or part of it, and real trouble is when they go under 5% threshold then we wouldn't even know who's doing the damage as they don't have to report.

[couta1]

At least we know who is selling and fortunately I don't rate them as Guru's, actually far from it.

[Beagle]

Will be interesting to see whether they continue to "Crystallise" further losses.?

There seems to be an almost inexhaustible supply at $2.33. In my opinion they will keep on keeping on selling and the price is effectivity capped despite the buyback.

[percy]

Maybe.
The shares they have sold ,appear to be the ones the brought, refer their announcement 12th March last year.
Perhaps their next announcement may state they brought these ones back.!!
They do appear to be "Beagles" ie they keep changing their minds...lol.
"Investors" may be best to ignore their shareholder notices?

[Beagle]

Beagles pretty cunning at sniffing out the next feed. Milford more like a lame 3 legged half blind pig dog at times and one that won't follow rules lol

[Ggcc]

I am looking for an entry point, but every time I think about it the price drops to a new low. That sort of stuff scares me off even though the company is running a fantastic profit. PS The mrs bought a car from Turners recently and the service was great and quick. On another note, it was sad, but good to see that when a couple were looking at buying were declined to purchase a car on finance. Good to see they don't want to sell a car to anyone.

[couta1]

I am looking for an entry point, but every time I think about it the price drops to a new low. That sort of stuff scares me off even though the company is running a fantastic profit. PS The mrs bought a car from Turners recently and the service was great and quick. On another note, it was sad, but good to see that when a couple were looking at buying were declined to purchase a car on finance. Good to see they don't want to sell a car to anyone. The main trading over the last while has been at $2.33 with a few going through at $2.32,you would have to think that the bottom is pretty much in given the higher than normal volume of late.PS-Happy to snap a few more up at $2.32.

[percy]

I am looking for an entry point, but every time I think about it the price drops to a new low. That sort of stuff scares me off even though the company is running a fantastic profit. PS The mrs bought a car from Turners recently and the service was great and quick. On another note, it was sad, but good to see that when a couple were looking at buying were declined to purchase a car on finance. Good to see they don't want to sell a car to anyone.

Must be hard for people wanting to buy a vehicle to be declined finance.
Yet it is the best for all parties in the long run.
Buying TRA.Well you can either wait for the trend to change,or you can ladder your buying.Buy a quarter of what you want today,buy another quarter in May if the result is OK,then buy another quarter in September if you are like the agm outlook,and finally the last quarter for your own Christmas present.!!

[winner69]

@LixAnnSonders
Market continues to reward companies tending to buy back shares or pay dividends vs. those making significant business investments @SoberLook @GoldmanSachs

I told her that doesn’t work in NZ

[percy]

@LixAnnSonders
Market continues to reward companies tending to buy back shares or pay dividends vs. those making significant business investments @SoberLook @GoldmanSachs

I told her that doesn’t work in NZ

Yeah right...??????????????....lol.


ps.Perhaps TRA will keep buying back shares until it does work.
At these prices that would make sense to me.

[winner69]

Phew that was close — though Turners share price was going to slide into the 120s

Nobuy backs for a while .....maybe they are hanging on for even cheaper shares

[percy]

Phew that was close — though Turners share price was going to slide into the 120s

Nobuy backs for a while .....maybe they are hanging on for even cheaper shares

Would be a rather large drop from $2.30 to $1.20s.

[RTM]

Don’t scare me like that Winner, I thought I had missed something. I think you mean the 220’s.



Phew that was close — though Turners share price was going to slide into the 120s

Nobuy backs for a while .....maybe they are hanging on for even cheaper shares

[Beagle]

Very well run Colonial Motors reported yesterday and profit dropped about 9% from memory. Plenty of talk about margins being squeezed.
Doesn't auger well for full year profitability of TRA but those dividends will keep coming in for the time being anyway so as long as one ignores the steadily dropping share price everything is fine and dandy. Next market update will be very interesting. Test of $2.00 coming up ?

[percy]

New car sales I would expect to be difficult.So no surprises there.!
Yes I too am looking forward to TRA's next update.
I am expecting it will confirm their strategy is oncourse.

[winner69]

Don’t scare me like that Winner, I thought I had missed something. I think you mean the 220’s.

Hope the gremlins in the phone weren’t sending us a message

[percy]

Hope the gremlins in the phone weren’t sending us a message

Rubbish in rubbish out.!

[Snoopy]

Nobuy backs for a while .....


Where did you see that Winner? Or are you just looking at the lack of recent in house buyback disclosure, the much lower share volume traded today, and the fact that the share price has sunk below the recent buyback price as your proof?

SNOOPY

[Beagle]

https://www.marketscreener.com/TURNERS-LTD-20699914/financials/
Analyst average forecast decline in eps for FY19 is 8% and declining again in FY20 by another 7% Ouch !
On track alright...to trade at under $2, you read it from this dog first.

[winner69]

Where did you see that Winner? Or are you just looking at the lack of recent in house buyback disclosure, the much lower share volume traded today, and the fact that the share price has sunk below the recent buyback price as your proof?

SNOOPY

Last notice was the 11th

If I remember right that was for a rather big buyback day ...maybe they have exceeded the stated ratios and waiting to catch up.

[percy]

https://www.marketscreener.com/TURNERS-LTD-20699914/financials/
Analyst average forecast decline in eps for FY19 is 8% and declining again in FY20 by another 7% Ouch !
On track alright...to trade at under $2, you read it from this dog first.

Two analysts?
They like you should be prepared to be surprised.
This year I am not sure of,however, the foundations have been laid for a cracker next year,which will set the tone for following years.

[percy]

Last notice was the 11th

If I remember right that was for a rather big buyback day ...maybe they have exceeded the stated ratios and waiting to catch up.

You may be right.
I thought the same.

[winner69]

https://www.marketscreener.com/TURNERS-LTD-20699914/financials/
Analyst average forecast decline in eps for FY19 is 8% and declining again in FY20 by another 7% Ouch !
On track alright...to trade at under $2, you read it from this dog first.

The same two analysts who Turners used to support their argument that the shares were very much undervalued .... remember AGM when they said they agreed with analysts outlook etc ....and loved the $3.32 consensus value ...and so a buyback

Seems one of those analysts have a target of $2.70 now


But problem with analysts is that their guess are all based on assumptions ...you know the sort of rubbish in rubbish out ones ....they just don't understand what clipping the ticket means. Take their forecasts at your peril

[Beagle]

Two analysts?
They like you should be prepared to be surprised.
This year I am not sure of,however, the foundations have been laid for a cracker next year,which will set the tone for following years.

Downgrades come in three's. TA continues to look shocking. Be careful out there folks.

[percy]

Be greedy when others are fearful.............Warren Buffett.

[janner]

Be greedy when others are fearful.............Warren Buffett.

Far be it for me to question Warren Buffet's words of wisdom Perc.
However I do feel that he meant for some thought before leaping in.

Sold out July 16 @ $3.05 at a lose. Have no intention of getting back in whilst it is on this present decline.

Not fearful. Just careful.

[Beagle]

Basic TA skills should serve investors well here. Those tempted to consider reentry after such a long and steady decline would do well to ameliorate their risk by waiting for the shares to break back above the 100 day moving average line which would appear to currently be $2.57.

These shares will be a good dividend yield play one day... when they start a new uptrend.

[Baa_Baa]

Be greedy when others are fearful.............Warren Buffett.

So you're buying/accumulating, not just sitting on a massive capital loss?

[percy]

So you're buying/accumulating, not just sitting on a massive capital loss?

Not buying as I have taken the position I want.Not selling either.
It is my third largest holding.
Capital loss......... yes.
Fat divies............ yes.
Strong conviction. yes.

[Baa_Baa]

Not buying as I have taken the position I want.Not selling either.
It is my third largest holding.
Capital loss......... yes.
Fat divies............ yes.
Strong conviction. yes.

So confusing, why would you quote Warren Buffet "Be greedy when others are fearful." and ignore that advice? It could be many years before your dividends exceed your capital losses if you do nothing, though taking Warren's advice you could have a much larger earner at substantially lower holding price. Conviction?

[RupertBear]

Not buying as I have taken the position I want.Not selling either.
It is my third largest holding.
Capital loss......... yes.
Fat divies............ yes.
Strong conviction. yes.

I no longer hold and pleased I got out without a capital loss.

I must confess I struggle to understand how one can be happy getting a fat divie while your capital is going down. :confused: Bears hate loosing capital :(

[Elles]

I no longer hold and pleased I got out without a capital loss.

I must confess I struggle to understand how one can be happy getting a fat divie while your capital is going down. :confused: Bears hate loosing capital :(

Better than not getting fat divies... And it's not an actual loss unless you sell.

[blackcap]

Better than not getting fat divies... And it's not an actual loss unless you sell.

That is a comforting theory some hold to, but as the sharemarket is very liquid etc, it is a loss even if you do not sell. There is always the opportunity cost one must consider to of being in "the market". I think you will find in the time that TRA has gone down the broader NZ market has gone up. So a double loss in effect. But I am arguing semantics.
I too hold some TRA as part of a diversified portfolio and have not given up on the story yet.

[percy]

I no longer hold and pleased I got out without a capital loss.

I must confess I struggle to understand how one can be happy getting a fat divie while your capital is going down. :confused: Bears hate loosing capital :(

My capital loss on TRA is unrealised.
What has been the goal of my investing.?
My goal was to build my capital to the point where when I retired ,I had the capital to provide me with a good income.
My capital is over twice what i aimed for,[and I have paid off both daughters' mortgages].
My dividends far exeed what my income was before I retired.
Goals achieved.I remain "well positioned"with a large diversified portfolio,which includes income shares,Australian shares,and still has some fun stocks.In fact my largest holding is a fun stock .

[Snoopy]

I must confess I struggle to understand how one can be happy getting a fat divie while your capital is going down. :confused: Bears hate losing capital :(


If you own a rental property, do you get a valuer in every day to value that property? Do you then get worried because sipping on your Saturday latte, your house price has gone down by 1% over the last week? I would suggest the answer is 'no' to both questions for two reasons:

1/ You don't have to look at your investment every day to know whether that investment is fulfilling your longer term investment goals.
2/ Paying real estate fees every week buying and selling your property would soon destroy any capital profit you made.

However, as a property investor, do you care if your tenant stops paying the rent? I would suggest the answer is 'yes', very much so.

Looking back at Turners, as Sharemarket investors, we are in a privileged position:

1/ We do not have to call in our own valuer each day to tell us what our Turners shares are worth.
2/ Using our ability to buy and sell Turners shares will incur much lower sales commissions that doing the same with a property.

However, these two advantages are not a 'call to action'. We can choose to accept market offers to buy our shares or ignore them. If we choose to focus on the dividend income from our Turners shares, we see that it is continuing to increase. Long term an increasing income stream will lead to an increasing share price. So there is no long term driving force to sell. Indeed, the rational investor would be more inclined to buy more because the lower the share price, the better the investment yield.

If you want to criticise Percy's Turners position, you could say that perhaps he should have staggered his Turners share purchases over a longer time frame. That would have meant that the 'with hindsight view' (which is never apparent at the time a purchase is concluded) that he paid too much for his TRA shares would mean he paid 'slightly less too much' (in effect that is my own position). But as Percy has told you, he bought for the income stream and the ability of that income stream to increase, and so did I. Neither of us are planning to sell over the medium term, and we are satisfied with our own yield return, which does not decrease if the share price falls.

Others have suggested that those of us still with investment capital to buy more ought to wait until share price rises to $2.57 or something to commit more capital to the company. For a yield investor this is BS. The lower the price you can buy your shares, and that could mean buying today, the better the investment yield. No matter what the share price does in the future, there are no exceptions to this rule.

SNOOPY

[Brain]

I no longer hold and pleased I got out without a capital loss.

I must confess I struggle to understand how one can be happy getting a fat divie while your capital is going down. :confused: Bears hate loosing capital :(

If someone knocks on your door and offers to buy your house at half of the value that you think it is worth you wouldn’t sell it because you would consider it a low ball offer. With shares you have to decide what is a fair price for the share. You do not have to accept low ball offers.

[minimoke]

If someone knocks on your door and offers to buy your house at half of the value that you think it is worth you wouldn’t sell it because you would consider it a low ball offer.
Unless you knew the tide was rising and devaluing your property every week and after a period of time it was going to be worth nothing.

[Snoopy]

If someone knocks on your door and offers to buy your house at half of the value that you think it is worth you wouldn’t sell it because you would consider it a low ball offer. With shares you have to decide what is a fair price for the share. You do not have to accept low ball offers.


I am not sure I fully agree with that analogy. Is $2.30 on market for TRA shares a low ball offer? Since there is a free market for Turners shares and that was yesterday's closing price, this would suggest the answer is no. However the market does go up and down both on company news and trends in wider interest rates. Those of us who have been in the market for many years know this. We also know that we don't have to scratch each and every daily itch. So I think it is fair to suggest that you can have a medium term view of where you think the share price should be that is not in accordance with the daily market price. As an investor, it is my job to arbitrage that price difference.

SNOOPY

[Snoopy]

If someone knocks on your door and offers to buy your house at half of the value that you think it is worth you wouldn’t sell it because you would consider it a low ball offer. With shares you have to decide what is a fair price for the share. You do not have to accept low ball offers.....



Unless you knew the tide was rising and devaluing your property every week and after a period of time it was going to be worth nothing.....


....which is not the case with Turners as they have a positive operational cashflow and turn a profit.

SNOOPY

[dodgy]

Unless you knew the tide was rising and devaluing your property every week and after a period of time it was going to be worth nothing.

Dear Minimoke,
The $64000000 question is "how does one actually know the tide" . If it was that easy every 100% informed punter would be rolling in it.
Regards
-dodgy

[Snoopy]

Dear Minimoke,
The $64000000 question is "how does one actually know the tide" . If it was that easy every 100% informed punter would be rolling in it.
Regards
-dodgy


No-one does know the tide, at least not for sure. So you have to work on positive indicators which statistically should see you get ahead over the longer term. However, no matter how careful you are, at some point an investment you are involved with will go wrong. This is why you need diversification in your portfolio. For my NZX investments, I have decided owning twelve shares at any one time (or more exactly six pairs of like shares - the individual members of each pair keeps the other one honest) is the way to go. My 'pair' for Turners Automotive Group is my latest investment - HGH.

SNOOPY

[dodgy]

[QUOTE=Snoopy;748503]No-one does know the tide, at least not for sure. So you have to work on positive indicators which statistically should see you get ahead over the longer term. However, no matter how careful you are, at some point an investment you are involved with will go wrong. This is why you need diversification in your portfolio. For my NZX investments, I have decided owning twelve shares at any one time (or more exactly six pairs of like shares - the individual members of each pair keeps the other one honest) is the way to go. My 'pair' for Turners Automotive Group is my latest investment - HGH.

Dear Snoopy,
I agree with you and having holdings in 3 markets further spreads risk - NZX high trading fees, ASX ($A29.90) very high trading fees, USA (US$0.00) very low trading fees. All this also goes in the mix , and, yes I pay tax so capital gains tax poses no interest in this regard.
Regards,
-dodgy

[RupertBear]

My capital loss on TRA is unrealised.
What has been the goal of my investing.?
My goal was to build my capital to the point where when I retired ,I had the capital to provide me with a good income.
My capital is over twice what i aimed for,[and I have paid off both daughters' mortgages].
My dividends far exeed what my income was before I retired.
Goals achieved.I remain "well positioned"with a large diversified portfolio,which includes income shares,Australian shares,and still has some fun stocks.In fact my largest holding is a fun stock .


If you own a rental property, do you get a valuer in every day to value that property? Do you then get worried because sipping on your Saturday latte, your house price has gone down by 1% over the last week? I would suggest the answer is 'no' to both questions for two reasons:

1/ You don't have to look at your investment every day to know whether that investment is fulfilling your longer term investment goals.
2/ Paying real estate fees every week buying and selling your property would soon destroy any capital profit you made.

However, as a property investor, do you care if your tenant stops paying the rent? I would suggest the answer is 'yes', very much so.

Looking back at Turners, as Sharemarket investors, we are in a privileged position:

1/ We do not have to call in our own valuer each day to tell us what our Turners shares are worth.
2/ Using our ability to buy and sell Turners shares will incur much lower sales commissions that doing the same with a property.

However, these two advantages are not a 'call to action'. We can choose to accept market offers to buy our shares or ignore them. If we choose to focus on the dividend income from our Turners shares, we see that it is continuing to increase. Long term an increasing income stream will lead to an increasing share price. So there is no long term driving force to sell. Indeed, the rational investor would be more inclined to buy more because the lower the share price, the better the investment yield.

If you want to criticise Percy's Turners position, you could say that perhaps he should have staggered his Turners share purchases over a longer time frame. That would have meant that the 'with hindsight view' (which is never apparent at the time a purchase is concluded) that he paid too much for his TRA shares would mean he paid 'slightly less too much' (in effect that is my own position). But as Percy has told you, he bought for the income stream and the ability of that income stream to increase, and so did I. Neither of us are planning to sell over the medium term, and we are satisfied with our own yield return, which does not decrease if the share price falls.

Others have suggested that those of us still with investment capital to buy more ought to wait until share price rises to $2.57 or something to commit more capital to the company. For a yield investor this is BS. The lower the price you can buy your shares, and that could mean buying today, the better the investment yield. No matter what the share price does in the future, there are no exceptions to this rule.

SNOOPY


Thanks Percy and Snoopy, very helpful thoughts, I think I finally get where you are coming from :)

[Beagle]

Others have suggested that those of us still with investment capital to buy more ought to wait until share price rises to $2.57 or something to commit more capital to the company. For a yield investor this is BS. The lower the price you can buy your shares, and that could mean buying today, the better the investment yield. No matter what the share price does in the future, there are no exceptions to this rule. Snoopy

Snoops me ol mate. That post assumes most people care about capital movements in the share price, (which I think is a very safe assumption). Waiting for a new uptrend to be confirmed through the use of TA such as the 100 day MA line break is a simple risk management tool which would have seen people get out at $3.00 and stay out.
You think most investors would have been happy with that decision with the benefit of hindsight ?

Some people are retired and have a focus mainly on income and have more capital than they need so whatever approach works fine for them is their business, but I would think the vast majority on here care quite a lot about movements in the share price. Worth noting that the shares have been in a pretty steady downtrend from just on $3.90 in May 2017 to the current price and it keeps making new multi year lows. You think there might be reason for this ? Like others I see no point in getting dividends if your capital gets seriously eroded in the process.

At the risk of being dogmatic, this will be a good yield investment for most people when a new uptrend is confirmed. To buy before that is risky and the risk of further capital erosion should be obvious to anyone with even a rudimentary understanding of charts and TA.

If all people care about is the dividend then yes absolutely no argument that you are right that the lower the price the greater the yield, (assuming the business is not going so badly that future dividends may be lower which may be what the share price is suggesting).

Something is not right here and I am a little surprised a dog with your nose can't pick up the scent of trouble ahead.

[BlackPeter]

I guess TA and FA, while both good tools give at this stage different answers. Percy's and Snoopy's views are spot on for anybody who invests with a mid or longterm time horizon ... as long as the fundamentals of the company don't change.

Question is - why does the TA look that terrible? They say the market is always right, but unfortunately that's only in determing the price of a share, not determing the value.

So - what is happening?

It appears there are indications that new car sales are dropping (see CMO) - and the drops are in line with the announcements of TRA - i.e. these years financials probably don't look that flash, but the market should have (and I think has) priced that in months ago. Unless there is a new desaster I would think that the upwards potential after the financials is much higher than further downward potential.

It is fair to say that some of the board members would not win in a popularity contest and particularly Byrnes and Bakers do have a somewhat patchy history related to creating consistent share holder value. On the other hand - they both had as well their successes - and DPC (chaired by Byrnes) while taking a huge drop after the GFC at least survived - this is more than other finance companies can claim ;);

The chair is as well sending mixed sigals whether this company has his full attention. Him holidaying (or whatever) during the AGM was unfortunate and showing disrepect to the holders, no matter whether the company (no doubt with his full knowledge and support) shifted the AGM date.

Sharebuybacks are a mixed blessing - while they increase EPS, they increase as well leverage ... and while TRA has (for a mixed trader / finance business) not yet reached a banking liabilities to equity ratio - they are moving into the wrong direction if they want to reduce this finance risk. Interest rates better don't go up ...

On the plus side - as percy does not get tired to repeat - they do have a plan and so far they are doing what they are saying. I do like the idea of a onestop shop for used cars - and being the biggest fish in the NZ second hand car pond must return (if nothing else) huge synergy gains. Even if the market takes a breather - they are well positioned to come out stronger out of any downturn than before (big fish eats small fish).

Consensus earnings for the next 3 years average to 27 cents. Not too bad for a $2.30 share with growth potential (all CAGR's I take are well above 15%).

While I do have mixed feelings related to the board - I do respect management - and at the end it is them determining the results - as long as the board does not get into their way.

Anything significant I missed? I am still holding and think that the share is at current undervalued - i.e. not the best time to sell ;);

[winner69]

I no longer hold and pleased I got out without a capital loss.

I must confess I struggle to understand how one can be happy getting a fat divie while your capital is going down. :confused: Bears hate loosing capital :(

See what you have done now Rupert - got many justifying their position

Shot off an email to my mates at the LSE for them to have a look at this good raw material for their studies - quick response was that a few must be going through a regret (at holding) stage and by justifying their position as to why they are seeking some comfort (even if it reassuring each other it’s all fine)

I’ve still got my small holding ...the punt that there would be profit upgrade and the share price would rocket up from 260 odd to 324 (I think it was) didn’t work....still hoping one day soon Baker and his Singapore mate would have found a buyer and give me $2.70 ....aren’t I stupid in hoping for that but at least I have a reason for still holding.

[BlackPeter]

See what you have done now Rupert - got many justifying their position

Shot off an email to my mates at the LSE for them to have a look at this good raw material for their studies - quick response was that a few must be going through a regret (at holding) stage and by justifying their position as to why they are seeking some comfort (even if it reassuring each other it’s all fine)

I’ve still got my small holding ...the punt that there would be profit upgrade and the share price would rocket up from 160 odd to 224 (I think it was) didn’t work....still hoping one day soon Baker and his Singapore mate would have found a buyer and give me $1.70 ....aren’t I stupid in hoping for that but at least I have a reason for still holding.

Hmm - are you implying there might be holders who have no reason for still holding?

[percy]

See what you have done now Rupert - got many justifying their position

Shot off an email to my mates at the LSE for them to have a look at this good raw material for their studies - quick response was that a few must be going through a regret (at holding) stage and by justifying their position as to why they are seeking some comfort (even if it reassuring each other it’s all fine)

I’ve still got my small holding ...the punt that there would be profit upgrade and the share price would rocket up from 160 odd to 224 (I think it was) didn’t work....still hoping one day soon Baker and his Singapore mate would have found a buyer and give me $1.70 ....aren’t I stupid in hoping for that but at least I have a reason for still holding.

How many do you want to sell at $1.70.?

[winner69]

How many do you want to sell at $1.70.?

Bugger ...keep getting my numbers wrong ...must think Turners even cheaper than I thought

[Beagle]

How many do you want to sell at $1.70.?

LOL Winner must be down at the beach again and sitting in the sun. Even I might be tempted at that price lol

Good post BP. I think the things you missed include Grant Baker showing disrespect while contemporaneously seeking a dramatic rise in his Chairman's director fee.
Too cowardly to face off against the snarling Beagle ? Deputy chair looked rattled for most of the AGM. Hospital pass to chair the meeting at the last minute ?
Board dysfunctionality ? Board seemed to have a real sense of entitlement to their dramatic fee increase, (arrogance I thought and I was near the front row at the annual meeting and felt in a good position to make an assessment) and simply aren't delivering the goods despite their massive fee increase.
Analysts are forecasting eps decreases of around 8% per annum this year and next. I think that SUM's up what you have missed...oh yes except KW's legendary advice NEVER buy in a downtrend. NO EXCEPTIONS !!

P.S. CMO forecasting tighter margins going forward is another thing I think you missed. I think the warning signs are there for those that choose to read the tea leaves.

[couta1]

Hits $2.25 and basically no buyers, that's the problem with this stock there's just no demand for it and untold large sellers lurking.

[Beagle]

Hits $2.25 and basically no buyers, that's the problem with this stock there's just no demand for it and untold large sellers lurking.

Its going under $2.00...remember who called it first.

[percy]

Hits $2.25 and basically no buyers, that's the problem with this stock there's just no demand for it and untold large sellers lurking.

What a bugger.!!!!.
I blame RupertBear...lol.

[winner69]

How many do you want to sell at $1.70.?

One thing if/when it gets to $1.70 I wont be surprised eh

[Beagle]

One thing if/when it gets to $1.70 I wont be surprised eh

Those typo's foretell an ominous future. Percy et al will be hoping they're just typo's. Take care in the sun down at the beach mate :)

[Ggcc]

I am still waiting for an entry point and have said it before it keeps dropping.

[winner69]

Those typo's foretell an ominous future. Percy et al will be hoping they're just typo's. Take care in the sun down at the beach mate :)

Bit windy so went to the park across the road to eat my Nasi Goreng — got the nice man to throw in a few extra prawns.

[winner69]

Drop to 225 only on 2000 shares

No worries

[minimoke]

Dum de doo. Dum de day. Each day a step closer to my stop loss.

[couta1]

Dum de doo. Dum de day. Each day a step closer to my stop loss. You like your stop losses mm, never used one except the sell button.

[minimoke]

You like your stop losses mm, never used one except the sell button.
I'm trying to take the emotion out of this share owning malarky.

[RupertBear]

See what you have done now Rupert - got many justifying their position

Shot off an email to my mates at the LSE for them to have a look at this good raw material for their studies - quick response was that a few must be going through a regret (at holding) stage and by justifying their position as to why they are seeking some comfort (even if it reassuring each other it’s all fine)

I’ve still got my small holding ...the punt that there would be profit upgrade and the share price would rocket up from 260 odd to 324 (I think it was) didn’t work....still hoping one day soon Baker and his Singapore mate would have found a buyer and give me $2.70 ....aren’t I stupid in hoping for that but at least I have a reason for still holding.

Oh dear but pleased to have provoked such interesting discussion :D

[RupertBear]

What a bugger.!!!!.
I blame RupertBear...lol.
Twasnt mee! I blame BP :D great post

[Snoopy]

Waiting for a new uptrend to be confirmed through the use of TA such as the 100 day MA line break is a simple risk management tool which would have seen people get out at $3.00 and stay out.
You think most investors would have been happy with that decision with the benefit of hindsight ?


My largest TRA 'purchase' was after that, when the TRAHB bonds matured and I elected to have those converted to shares. This was at the conversion price of $2.85 IIRC. This was in effect a 'cash issue event' for TRA. Statistically buying in at 'cash issue time' is usually good timing. My last purchase on market was just before the last dividend. Statistically, once again, this is generally a good strategy because I would have expected the share price to slowly recover the amount of the dividend paid.

In both instances there was no share price recovery. But 'playing the odds', which is what I try to do, doesn't always come out in your favour. When that happens you have to take it on the chin. I don't regret either purchase, except with the benefit of hindsight, which no purchaser can have when they buy their shares.



Some people are retired and have a focus mainly on income and have more capital than they need so whatever approach works fine for them is their business, but I would think the vast majority on here care quite a lot about movements in the share price. Worth noting that the shares have been in a pretty steady downtrend from just on $3.90 in May 2017 to the current price and it keeps making new multi year lows. You think there might be reason for this? Like others I see no point in getting dividends if your capital gets seriously eroded in the process.


I have held TRA for a few years, but a significant stake for only a few months. Despite the share price decline over the last six months. I was never going to be 'shaken out' within a few months. My purchasing of TRA shares is not finished yet either. If 'averaging across' at the current price makes sense, then I will do it. Contrary to what you think I do care about what price I sell my TRA shares at. But I don't have to sell any so I won't. And as the business cycle works its way through, I expect any on paper capital loss to disappear anyway.



At the risk of being dogmatic, this will be a good yield investment for most people when a new uptrend is confirmed. To buy before that is risky and the risk of further capital erosion should be obvious to anyone with even a rudimentary understanding of charts and TA.


A trend will continue until it reverses. There is no guarantee a new uptrend will not reverse again. I prefer to buy at bargain prices according to my best judgement, even if I have to rewrite my bargain price level later. I don't believe any of my purchases have been risky given what has happened since I bought. Remember, unlike HGH, there has been no profit projection downgrade at TRA. It is only some analysts who have said profits will shrink and I am not sure they are right. From Turners themselves, the only statement has been that if certain market conditions occur, then lower profits can be expected.



If all people care about is the dividend then yes absolutely no argument that you are right that the lower the price the greater the yield, (assuming the business is not going so badly that future dividends may be lower which may be what the share price is suggesting).

Something is not right here and I am a little surprised a dog with your nose can't pick up the scent of trouble ahead.


You mean like after I bought into HGH and the share price sunk down to $1.31 and various posters predicted a cash issue and/or a cut to the dividend? I wasn't one of those that smelt that happening and it didn't!

SNOOPY

[Beagle]

I didn't predict a cash issue for HGH or a dividend cut either but did manage to get a few at $1.31 and quite a lot at $1.33 :)

[RupertBear]

O
My capital loss on TRA is unrealised.
What has been the goal of my investing.?
My goal was to build my capital to the point where when I retired ,I had the capital to provide me with a good income.
My capital is over twice what i aimed for,[and I have paid off both daughters' mortgages].
My dividends far exeed what my income was before I retired.
Goals achieved.I remain "well positioned"with a large diversified portfolio,which includes income shares,Australian shares,and still has some fun stocks.In fact my largest holding is a fun stock .

I now have a very modest number of divee shares, MEL, GNE, SPK, CEN but to get anywhere near a decent income from them I would need to have a s**t load more than I have and that would stress the Bear out! :mellow::huh:

Oh and well done on what you have achieved Percy, you have my respect :)

[winner69]

Snoopy

. It is only some analysts who have said profits will shrink and I am not sure they are right. From Turners themselves, the only statement has been that if certain market conditions occur, then lower profits can be expected.


Snoops, you may be right that technically Turners haven’t downgraded F19 earnings guidance ....just indicated that they might be lower.

Wonder what disclosure guidelines say about such vagueness?


So statistically there’s still a high chance of them delivering $34m-$36m npbt .....yes?

[winner69]

BP, good post you made yesterday

One comment you made was - Consensus earnings for the next 3 years average to 27 cents. Not too bad for a $2.30 share with growth potential (all CAGR's I take are well above 15%).

I assume you are saying in a round about way that TRA’s current PE is too low relative to company growth ....ie TRA is ‘cheap’

I often look at the chart below to remind myself not to put too much reliance on PEs because EPS growth has almost no bearing on valuations, at least in the USA. Might try to extract data for the NZX but I would hazard a guess that it’s much the same here.

[BlackPeter]

Still trying to make sense out of the TRA trend. Beagle likes to compare it (unfavourable) with CMO - and while I didn't thought that this is a valid comparison (second hand car dealer with insurance and finance vs new car dealer with service) - actually, if we look at the charts the trend at least used to be quite nicely correlated (i.e. markets thought its a valid comparison):

10338

I know - didn't manage to get the time axis into the pic, but this is a 5 years comparison starting Feb 2014 and ending Feb 2019. Pretty nicely correlated until May / June 2017. At this stage TRA (blue) started its mercyless decent ... and CMO SP (yellow) kept growing.

What changed in the mid of 2017 uncorrelating these two companies?

Other thing above chart shows is that TRA's SP well might be a cyclical ... with it currently being on a 5 year (cyclical) low. Obviously - given that revenue and earnings don't seem to by cyclical (this is the lower graph) is it difficult to see where the cycle would come from.

10339
Blue line: revenue in $m (obviously - 2019 - 2021 are analyst estimates)
Red line: EPS in tenth of cents (just to allow me to use the same Y-axis)

ah yes - and 2012 - 2014 are combined TNR + DPC revenue and income (borrowed from one of Snoopy's posts - cheers!);

Here is one observation: growth was 5 years ago (2012-2014) quite weak (restarted 2014/15) and it is now again quite weak (following potential profit warning and analysts forecasts). Maybe the low SP is just a reflection on low (current) growth?

Who knows ...

[Beagle]

Still trying to make sense out of the TRA trend. Beagle likes to compare it (unfavourable) with CMO - and while I didn't thought that this is a valid comparison (second hand car dealer with insurance and finance vs new car dealer with service) - actually, if we look at the charts the trend at least used to be quite nicely correlated (i.e. markets thought its a valid comparison):

10338

I know - didn't manage to get the time axis into the pic, but this is a 5 years comparison starting Feb 2014 and ending Feb 2019. Pretty nicely correlated until May / June 2017. At this stage TRA (blue) started its mercyless decent ... and CMO SP (yellow) kept growing.

What changed in the mid of 2017 uncorrelating these two companies?

Other thing above chart shows is that TRA's SP well might be a cyclical ... with it currently being on a 5 year (cyclical) low. Obviously - given that revenue and earnings don't seem to by cyclical (this is the lower graph) is it difficult to see where the cycle would come from.

10339
Blue line: revenue in $m (obviously - 2019 - 2021 are analyst estimates)
Red line: EPS in tenth of cents (just to allow me to use the same Y-axis)

ah yes - and 2012 - 2014 are combined TNR + DPC revenue and income (borrowed from one of Snoopy's posts - cheers!);

Here is one observation: growth was 5 years ago (2012-2014) quite weak (restarted 2014/15) and it is now again quite weak (following potential profit warning and analysts forecasts). Maybe the low SP is just a reflection on low (current) growth?

Who knows ...
That's the riddle to solve. If we go back further CMO's outperformance looks even better.
I have a number of theories.
1. The second hand vehicle industry is a very very tough one with no meaningful barriers to entry whereas the new vehicle distributor needs to hook into a well recognised manufacturer to establish itself.
2. Colonial motors have been doing very well with the Ford Ranger and the Mazda SUV range which is best in class in my view as well as their heavy truck division.
3. Turners have been struggling with the delinquent loan problem from non recourse lending through MTF and this will continue into FY20.
4. I think Turners will struggle a bit with the new IFRS9 requiring more prudent bad and doubtful debt provisioning from the get-go.
5. I think more and more people are buying second hand cars through Trade Me and other digital platforms whereas new vehicles must generally be purchased through franchised dealerships.

I would reiterate that the average analyst forecast is for declining eps of ~ 8% FY18 to FY19 and FY19 to FY20.
I really don't know how you get your average growth figures...perhaps a little "convenient" taking a 3 year forward view ?
The market is concerned with the here and now for TRA in terms of the eps decline for FY19 and FY20.

My view, (flame suit is on) is that at present it is clear Turners is a no growth company. They have a LOT to prove to the market that their business plan will generate eps growth. After Baker's major mistake of not attending the annual meeting I am not surprised that the market is calling TRA out in terms of its credibility.
No growth companies are worth a PE of 8.5 in my book, (Ben Graham core figure for no growth) so 8.5 x FY20 eps of 24.8 cps https://www.marketscreener.com/TURNERS-LTD-20699914/financials/ gives a fair value later this year as we head into FY20 of $2.11.
Momentum is a powerful thing though and I would not be the least bit surprised to see it go under $2, in fact I would go further and say I will be surprised if this doesn't happen. The market hates uncertainty and that's exactly what Turners is exuding at the moment.

[Snow Leopard]

...No growth companies are worth a PE of 8.5 in my book...

A no-growth company with a consistent 17c dividend?

You need a new book!

[winner69]

BP ...your mystery re why TRA and CMO share prices have diverged has little to do with ‘fundamentals’. It’s all about how they’ve treated the market per se.

TRA share price started falling when the market woke up and noticed that the much touted eps accretive growth acquisitions weren’t really working. Add to that a delusional Board who have sucked millions out of investors pockets and who then keep crying all the way to Mummy complaining the market doesn’t love them it’s no surprise the TRA share price is where it is today.

CMO on the other hand have just quietly kept on doing what they do well. They’ve said very little and investors remain pretty happy with them as the share price continues to trend up and is not too far it’s all time high

I conclude it’s all about how the market perceives the Board and management of each company

[BlackPeter]

4. I think Turners will struggle a bit with the new IFRS9 requiring more prudent bad and doubtful debt provisioning from the get-go.


Hmm - that's not what the company says in its 2018 annual reprot:


The indicative impacts of implementing NZ IFRS 9 are as follows:
 Classification and measurement of financial instruments:
The Group's financial assets and liabilities include only those measured, at amortised cost, at fair value through profit or loss; and at
fair value through other comprehensive income. The Group anticipates that the classification and measurement of its financial assets
will remain unchanged under NZ IFRS 9.
 Impairment model change from incurred losses to expected credit losses:
The introduction of the expected credit losses impairment model is expected to involve a change in the timing of when impairment
losses are recognised.
Trade and other receivables
With regards to the Group’s trade receivables, the Group's incurred credit losses from these financial assets have historically not been
material. Consequently the introduction of the expected credit losses impairment model is not expected to have a material impact on
the Group’s financial statements, given the Group’s low exposure to counterparty default risk as a result of the Group’s credit risk
management processes that are in place.
Finance receivables
With regards to the Group’s trade receivables, the Group's incurred credit losses from these financial assets have historically been
material. Consequently, the introduction of the expected credit losses (‘ECL’) impairment model is expected to have a material impact
on the Group’s financial statements. The Group has undertaken a preliminary assessment on the possible impact that the introduction
of the ECL impairment model will have on the Group’s finance receivable impairment provisioning. The preliminary analysis indicates
that as at 31 March 2018 it would have resulted in an increase in finance receivable provisioning between $1.2m to 1.7m. The Group is
continuing to undertake further analysis.
 Hedge accounting
The Group has hedging arrangements, however these are immaterial and the recognition and measurement of these arrangements
under NZ IFRS 9 will remain largely unchanged
The Group will adopt NZ IFRS 9 for the accounting period beginning on 1 April 2018.


OK - So Turners says they expect a roughly $1.2m to 1.7m impact in provisioning. Big deal. .. or do you think they are wrong?




5. I think more and more people are buying second hand cars through Trade Me and other digital platforms whereas new vehicles must generally be purchased through franchised dealerships.


I have not seen evidence that TradeMe is taking business away form traditional second hand dealers. Yes, it is a platform to advertise, used as well a lot by second hand dealers (like Turners). Buying a second hand car from private (no matter whether through TradeMe or otherwise) is just much more risky ...




I would reiterate that the average analyst forecast is for declining eps of ~ 8% FY18 to FY19 and FY19 to FY20.


You forgot to mention that EPS in FY21 is growing again.




I really don't know how you get your average growth figures...perhaps a little "convenient" taking a 3 year forward view ?
The market is concerned with the here and now for TRA in terms of the eps decline for FY19 and FY20.



I am taking 3 year forward / 4 year backward. Convenient? Not sure - but this is one of my standard measures, i.e. not specifically made up for TRA. Pick any other window and I will show you some companies for which these would be "convenient".





No growth companies are worth a PE of 8.5 in my book, (Ben Graham core figure for no growth) so 8.5 x FY20 eps of 24.8 cps https://www.marketscreener.com/TURNERS-LTD-20699914/financials/ gives a fair value later this year as we head into FY20 of $2.11.
Momentum is a powerful thing though and I would not be the least bit surprised to see it go under $2, in fact I would go further and say I will be surprised if this doesn't happen. The market hates uncertainty and that's exactly what Turners is exuding at the moment.

Convenient you moved just for TRA back to the original Grahams formula? I remember you worked for other companies with a factor of 10 plus one times growth, but hey ...

[Snoopy]

I often look at the chart below to remind myself not to put too much reliance on PEs because EPS growth has almost no bearing on valuations, at least in the USA. Might try to extract data for the NZX but I would hazard a guess that it’s much the same here.


Winner, that R^2 = 0.0006 in your diagram is the overall correlation value right? An R^2 value of 0 means no correlation at all. And 0.0006 is pretty close to zero anyway.

It is investors who set the PE ratio. It is they who decide what price they will pay for any hoped for earnings growth. So really what you are saying, in a very discreet collective way, is that we investors have the forecasting skill of someone who forecasts their investment growth rate by throwing darts at a dart board? Is that sobering or insulting? Maybe a bit of both?

On closer inspection of your chart, perhaps we aren't quite so bad? If you look at those really high PE shares, around a PE of 50, then only a couple had a negative growth rate after five years. It is actually the companies that had a PE ratio of 10 to 25 (within the more normal range) where:

1/ the 'eps' growth up to 2014 AND
2/ the PE ratio paid in 2010

show the most similar pattern (in this case, the least correlation).

My interpretation of that chart is that, as an investor, you should target companies with a current PE of 10 or lower. Because that way, you are not paying a high price for future 'eps' growth. Yet there is an average chance you will get it anyway.

SNOOPY

[Snoopy]

Snoops, you may be right that technically Turners haven’t downgraded F19 earnings guidance ....just indicated that they might be lower.

Wonder what disclosure guidelines say about such vagueness?


Is an 'If'/'Then' prediction vague? I thought Turners communicated the possible profit weakness appropriately.



So statistically there’s still a high chance of them delivering $34m-$36m npbt .....yes?


Not sure what the source of that $34m - $36m NPBT prediction is. From my post 3984 on this thread, my annualised operational NPAT prediction for FY2019 is $17.370m. At a 28% tax rate, that would represent a NPBT of $24.125m. Add back in the property sale profit from Wiri of $3.4m and the earn out payment adjustment for Autosure of $0.8m and I get NPBT of $28.325m. Can the gap be bridged further?

I think there are more property deals in the second half that could do it. I further think that there might be more ticket clipping across the sales/finance/insurance 'cross clip'. Yet I prefer to look at the operational NPAT and, by my definition, that doesn't include the income from "in house property development".

So as of now, $17.370m remains my 'go to' NPAT profit figure for FY2019. That is equivalent to an 'eps' figure of 19.4cps. At $2.20, that means the share is currently trading on a projected PE ratio of 11.3 for FY2019. If you look back over the years from an operational NPAT perspective, the PE ratio has come down from a high of 19.4 in FY2015. Growth has probably been on track over that time period. But the less well publicised figure of 'eps Growth' has been far less impressive, as the shares on issue have ballooned from 63m to over 89m.

You can blame sub optimal management and a softening used car market for TRAs share price woes. But to look at the biggest reason for the share price decline, shareholders might do well to look in the mirror. The biggest reason for the share price decline is that four years ago investors were too optimistic and were willing to pay too high a multiple for the shares. And yes I blame myself too as part of that investor overoptimistic group, even though I harbour a secret feeling that maybe some of those promised triple ticket clipping gains are still to be fully realised.

SNOOPY

[winner69]

Winner, that R^2 = 0.0006 in your diagram is the overall correlation value right? An R^2 value of 0 means no correlation at all. And 0.0006 is pretty close to zero anyway.

It is investors who set the PE ratio. It is they who decide what price they will pay for any hoped for earnings growth. So really what you are saying, in a very discreet collective way, is that we investors have the forecasting skill of someone who forecasts their investment growth rate by throwing darts at a dart board? Is that sobering or insulting? Maybe a bit of both?

On closer inspection of your chart, perhaps we aren't quite so bad? If you look at those really high PE shares, around a PE of 50, then only a couple had a negative growth rate after five years. It is actually the companies that had a PE ratio of 10 to 25 (within the more normal range) where:

1/ the 'eps' growth up to 2014 AND
2/ the PE ratio paid in 2010

show the most similar pattern (in this case, the least correlation).

My interpretation of that chart is that, as an investor, you should target companies with a current PE of 10 or lower. Because that way, you are not paying a high price for future 'eps' growth. Yet there is an average chance you will get it anyway.

SNOOPY

Snoops - only posted that chart in response to BP who implied that with EPS growth about 15% a PE of <10 isn’t fair/reasonable or whatever you want to call it. I was just showing that eps growth almost has no bearing on markets

1- yes investors (if you want to punters who don’t hold forever investors) set the PE

2- not insulting anyone about their ‘forecasting’ skills ...just suggesting PEs aren’t much help in doing valuations

3- many things drive PE ratios. In Turners case it is current much lower than a year or so ago. I think it’s investors (oh that word again) have given the one finger salute to Turners Board and management for emptying their pockets, those non eps accretive acquisitions and the constant bleating about how nobody understands the business and the shares are undervalued.

4- sort of agree with your last paragraph but there is still implied hope in what you say in that maybe there’s a good reason it trades on low multiples and high yield (implying high risk)


I still hoping for that takeover to come ....soon I hope

[winner69]

Snoops the $34m to $36m npbt was original company guidance for F19

They talked about if/maybe and 10% less. Not very specific was it = ‘vague”

I think it was you who suggested it wasn’t really guidance as the if may never happen.

Wouldn’t it have been less vague and a firmer guidance if they had just come out and said ‘Because of if (reason) F19 npbt is now forecast to be 10% less than our previous guidance of $34-$36m’

[winner69]

BP ...good copy and paste from AR re IFRS9 and bad debts

Have you noted the words prelimary, expected, model assessesment, would have etc.

I think they are still learning how to drive their model and hoping that a bad number doesn’t pop out

Turners don’t seem to be very good at learning how to ‘fix’ things they didn’t really understand. From memory they mentioned at least 4 times they have struggled to weed out and control bad loans ..,and raised that issue in the half year report. Doesn’t give you much confidence does it.

Even the bright sparks at Heartland didn’t get their first run through of IFRS9 reporting correct.

[percy]

[QUOTE=winner69;748696]

Turners don’t seem to be very good at learning how to ‘fix’ things they didn’t really understand. From memory they mentioned at least 4 times they have struggled to weed out and control bad loans ..,and raised that issue in the half year report. Doesn’t give you much confidence does it.

Turners have a very low % of bad motor vehicle loans,as do HGH.Motor vehicle lending is a good sector to be in.
The "learning how to fix things" happened when they offered MTF originators the option of non-recourse loans.[remember this was the attraction to MTF of HGH taking them over,which TRA stopped with their clever blocking holding]
Going from MTF announcement last year, Turners woke up to the fact the MTF non-recourse loans were of a much lower standard than Turners own loans.
Turners then acted straight away, tightening their non-recourse criteria for MTF non-recourse originated loans.
One problem quickly identified,and fixed.What we do not know is the cost it came to.A one off cost?
With TRA board having such a strong background in finance, it came as no surprise to me they acted so quickly.What was disappointing was they let it happen in the first place.[However I guess if TRA had not been caught HGH would have been].
The outcome is Turners now get involved at the very start of any loan origination.HGH now have the same policy.
The big losers would be to the MTF originators TRA weeded out.
Turners also diverted a lot of the loans they usually put through MTF to their own Oxford Finance Company,with a resulting increase of margin to Turners..

HGH.At the same TRA had issues with MTF originated non-recourse loans,Heartland had issues with their new operating systems."Two months of Hell" is how they discribed it.The out come was loans arrears were not chased up and therefore blew out.


So both HGH and TRA had issues.Both acted quickly and limited the amount lost. However there were losses.These losses I feel should be regarded as "one offs". HGH got their new system up and running,while TRA sorted out their non-recorse lending with MTF.

[BlackPeter]

BP ...good copy and paste from AR re IFRS9 and bad debts

Have you noted the words prelimary, expected, model assessesment, would have etc.

I think they are still learning how to drive their model and hoping that a bad number doesn’t pop out

Turners don’t seem to be very good at learning how to ‘fix’ things they didn’t really understand. From memory they mentioned at least 4 times they have struggled to weed out and control bad loans ..,and raised that issue in the half year report. Doesn’t give you much confidence does it.

Even the bright sparks at Heartland didn’t get their first run through of IFRS9 reporting correct.

Well, yes - I did notice these words. It would be brave (or more likely stupid) if they wouldn't use some qualifiers when predicting an outcome of an exercise they hadn't done at that time - wouldn't it?

Not sure how to read your comment "Turners don’t seem to be very good at learning how to ‘fix’ things they didn’t really understand. From memory they mentioned at least 4 times they have struggled to weed out and control bad loans" comes from. As far as I recall - they identified the issue, identified a strategy to fix it and are implementing it now. And yes, it takes more than 6 months to fix the problem and changing the goal post (implementation of IFRS9 on half way) did not help. Actually - they use the new numbers already in the HY report, so yes, it is a bit worse than anticipated in the FY report (something like 1.9m instead of the max of 1.7 m they forecasted). Should have checked the latest HY report in the first place ...

Not a bean counter, but from my impression Aaron Saunders appears to be pretty switched on. I am sure he makes mistakes as everybody else, but I would expect he is learning from them as well. Don't you?

[kiora]

For investors it comes down to hold or fold?,buy or sell?
A decision to make one way or the other with the available information.If in doubt .........

[Beagle]

Hmm - that's not what the company says in its 2018 annual reprot:
OK - So Turners says they expect a roughly $1.2m to 1.7m impact in provisioning. Big deal. .. or do you think they are wrong?
Its a preliminary figure. In my experience most finance companies under provision for bad and doubtful debts especially when they finally and often begrudgingly admit there's a key area that's gone wrong, (in this case non recourse MTF loans running at a staggering 8% delinquency rate IIRC) I don't think these have been provisioned fully and their modelling is highly likely to be incorrect.

I have not seen evidence that TradeMe is taking business away form traditional second hand dealers. Yes, it is a platform to advertise, used as well a lot by second hand dealers (like Turners). Buying a second hand car from private (no matter whether through TradeMe or otherwise) is just much more risky ... [COLOR="#0000FF"]You're not going to see evidence but the fact is Turners sales have only broadly only matched the population growth in N.Z. which last year was running quite strong with immigration. This population / sales match appears to have come from a significant increase in retail footprint..

You forgot to mention that EPS in FY21 is growing again.
The motor vehicle industry is notoriously cyclical and in bad times low single digit PE's are possible. Plenty of punters predicting a recession in 2020...who knows what Fy21 looks like for TRA, its pure guesswork this far out.

I am taking 3 year forward / 4 year backward. Convenient? Not sure - but this is one of my standard measures, i.e. not specifically made up for TRA. Pick any other window and I will show you some companies for which these would be "convenient".[COLOR="#0000FF"]Its a sunset industry BP.
Convenient you moved just for TRA back to the original Grahams formula? I remember you worked for other companies with a factor of 10 plus one times growth, but hey ...Standard valuation methodologies are used on sunset industries at one's absolute peril !

I believe they mentioned at the annual meeting that they'd changed their lending policies to try and weed down bad loans. IIRC they mentioned they'd changed them 4 times. It all had a rather "experimental" feel to it...you know...trial and error...and more trail and more error and so on...
Watch for bad and doubtful debts and provisioning for them to be a real feature of FY19 and FY20 reporting along with a much larger retail footprint generating a very similar amount of sales and we all know what that does to profitability.

Personally I feel one is best to be quite conservative at this stage and take an average eps of 26.68 cps, the last 2 years and the next forecast 3 off market screener, forget about all this talk of growth because the only thing growing fast is directors fees and the number of a certain person's posts telling us all is fine and dandy and then start with a no growth PE of 8.5 and take something off for this being a long term sunset industry. I think that gives us around 7.5 - 8.0 x 26.68 = $2.00 - $2.13.

I expect with all the downward momentum it will overshoot on the downside of that in the near term. That's how I see it anyway but I am sure others will see it differently and that's fine. I'm interested once a new uptrend has been proven (minimum indicator is a break back above 30 day MA) but where's the bottom with all the present uncertainty is frankly anyone's guess.

[Snoopy]

Snoops - only posted that chart in response to BP who implied that with EPS growth about 15% a PE of <10 isn’t fair/reasonable or whatever you want to call it. I was just showing that eps growth almost has no bearing on markets


I also am projecting 'normalised' earnings growth of 15% for FY2019. But if you consider 'normalised earnings' then at $2.20, I have TRA on a forecast PE for FY2019 of 11.3. Perhaps that PE makes a bit more sense for a company growing earnings at 15%? (I have stripped out all of the property redevelopment profits out of my normalised figures).

I think your chart showed that forecast eps growth (for in effect that is what a PE is, because a punter must estimate a future 'eps' when buying to get a forecast PE Ratio) did not correlate with actual eps growth. It did not show that actual eps growth had almost has no bearing on markets' pricing of a share. But then I haven't read the wider text of the article behind that chart.

SNOOPY

[percy]

For the record.
There has been some conjecture, in some quarters that Percy Corp has also incured a rather large loss, due to a big drop in the paper value of my stocks, similar to the NZ $36.5 billion [paper] loss, Warren Buffett's Berkshire Hathway suffered in the fourth quarter.
This conjecture is with out foundation, and Percy Corp remains "well positioned," as my stocks are performing well overall,and have the capacity to pay increasing fully imputated dividends...............................lol.

[minimoke]

For the record.
There has been some conjecture, in some quarters that Percy Corp has also incured a rather large loss, due to a big drop in the paper value of my stocks, similar to the NZ $36.5 billion [paper] loss, Warren Buffett's Berkshire Hathway suffered in the fourth quarter.
This conjecture is with out foundation, and Percy Corp remains "well positioned," as my stocks are performing well overall,and have the capacity to pay increasing fully imputated dividends...............................lol.I suspect Percy Corp has got in some crafty accountants and come up with new independent valuation of some property holdings,

[percy]

I suspect Percy Corp has got in some crafty accountants and come up with new independent valuation of some property holdings,

Not so.
I have always relied on my own valuations.
They are the only ones I trust.?,.....................................lol.

[LAC]

Can I buy one share in Percy Corp....is it listed on the NSE lol;)

[minimoke]

I'll be pleased when the share buy back ends. The longer it goes on the lower the SP seems to get.

[percy]

I'll be pleased when the share buy back ends. The longer it goes on the lower the SP seems to get.

Get used to it, as I expect it will be extended..!!.
Just keep lowering your stoplosses.!.
Turnaround may happen on 21st March...ie That's the next full moon,otherwise we will need to wait for the following one, due 19th April.

[Beagle]

I'll be pleased when the share buy back ends. The longer it goes on the lower the SP seems to get.

Where would the share price be without the support of the buy-back ? SP action after it finishes might be something interesting to watch.

[percy]

Yes trying times for all Turners shareholders including directors who have a lot of skin in the game.
However as we all know NZders love to buy cars [even suspect Holdens]...lol.

[couta1]

Get used to it, as I expect it will be extended..!!.
Just keep lowering your stoplosses.!.
Turnaround may happen on 21st March...ie That's the next full moon,otherwise we will need to wait for the following one, due 19th April. ah ooo Werewolves of London.

[peat]

I suspect Milford are reducing their 4.99% further

[couta1]

I suspect Milford are reducing their 4.99% further Most likely so read into that what you will, doesn't say much to me as they have shown on many occasions that they are not the smart money.

[winner69]

Standard valuation methodologies are used on sunset industries at one's absolute peril !

I believe they mentioned at the annual meeting that they'd changed their lending policies to try and weed down bad loans. IIRC they mentioned they'd changed them 4 times. It all had a rather "experimental" feel to it...you know...trial and error...and more trail and more error and so on...
Watch for bad and doubtful debts and provisioning for them to be a real feature of FY19 and FY20 reporting along with a much larger retail footprint generating a very similar amount of sales and we all know what that does to profitability.

Personally I feel one is best to be quite conservative at this stage and take an average eps of 26.68 cps, the last 2 years and the next forecast 3 off market screener, forget about all this talk of growth because the only thing growing fast is directors fees and the number of a certain person's posts telling us all is fine and dandy and then start with a no growth PE of 8.5 and take something off for this being a long term sunset industry. I think that gives us around 7.5 - 8.0 x 26.68 = $2.00 - $2.13.

I expect with all the downward momentum it will overshoot on the downside of that in the near term. That's how I see it anyway but I am sure others will see it differently and that's fine. I'm interested once a new uptrend has been proven (minimum indicator is a break back above 30 day MA) but where's the bottom with all the present uncertainty is frankly anyone's guess.




Jeez $2 .....that’s almost half price from last year (needs doubling to get back there)

PEs don’t mean much ....maybe value as a divie stock ....as no growth likely could treat it like a bond. Maybe should price it like a ‘bond’ with an expected 10% pre tax return to compensate for risk (based on performance and even this sunset industry talk)

[stoploss]

Most likely so read into that what you will, doesn't say much to me as they have shown on many occasions that they are not the smart money.
Couta 13.8 % PA over 10 years ,there will be a lot of people on here who would be happy with that .

https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12151576

[couta1]

Couta 13.8 % PA over 10 years ,there will be a lot of people on here who would be happy with that .

https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12151576 For sure but doesn't mean they are the smart money here, I guess time will tell. PS-Im guessing they were too overweight in a highly illiquid stock so decided to reduce.