SUM - Summerset Group

[Beagle]

Good thing about Cout’s Theorem is that when the price reverts to the mean it generally/usually/ often overshoots

According 7 bucks plus is on the cards in next month or two ...maybe after third quarter sales report in early October

Yeah, beggared if I know why we bother with any FA or TA analysis when all you need is the GOLD standard CA (Couta1 analysis). 42% relativity was a screaming bargain in the low $5's (not that many weeks ago) something I might have mentioned a few times based on FA, but who needs fundamental analysis anyway :p As you say Winenr, more often than not it overshoots right up to the top of the range at 60% so my price target is 60% of RYM $13.30 = $7.98 !

I think Coutts is a bit miffed he didn't follow his own CA and get some in the low $5's...too concentrated on the milky share.

[winner69]

Yeah, beggared if I know why we bother with any FA or TA analysis when all you need is the GOLD standard CA (Couta1 analysis). 42% relativity was a screaming bargain in the low $5's (not that many weeks ago). As you say Winenr, more often than not it overshoots right up to the top of the range at 60% so my price target is 60% of $13.30 = $7.98 !

And $7.98 isn’t even new territory ...been there done that eh

Onwards and upwards

[Beagle]

And $7.98 isn’t even new territory ...been there done that eh

Onwards and upwards

60% of RYM at $14 is $8.40 and will be new territory though. Rising tide lifts all boats. Real estate in Australia has bottomed and turned and Melbourne / Sydney real estate were up 0.8% in August. Disc: Topped up SUM more yesterday.

[winner69]

60% of RYM at $14 is $8.40 and will be new territory though. Rising tide lifts all boats. Real estate in Australia has bottomed and turned and Melbourne / Sydney real estate were up 0.8% in August. Disc: Topped up SUM more yesterday.

Took my profits out of ARV the other week and admit got a few more SUM as well.

Jeremy’s efforts to ramp ARV got better of me

Pity OCA is the real dog of the sector eh .....even Mavericks patience must be wearing thin.

[Beagle]

Yeap, feeling sorry for Maverick, (turns out you can have too many), and Coutts tells me, (hope he's okay with me sharing), that SUM have been making some very good high level hire's in the care sector headhunting some of OCA's best senior staff. I expect SUM to be on the up and up with their care service standards.

Maverick will be alright in the long run.... but Beagle's are no good at waiting years to be fed properly, always on the hunt for a quick easy feed in the near future lol
On a brighter note if the OCR goes down to 0.25% next year like the ANZ think it will and term deposits are about 2% OCA at 4.6% will be a high yielding share :)

[percy]

SUM's current share price is $6.33.Their dividend is 13.6 cps which is a 2.15% yield.
Is that a gross yield or a net yield.?
From memory the dividend is not fully imputed,so it looks to be a gross yield.

[winner69]

Yeap, feeling sorry for Maverick, (turns out you can have too many), and Coutts tells me, (hope he's okay with me sharing), that SUM have been making some very good high level hire's in the care sector headhunting some of OCA's best senior staff. I expect SUM to be on the up and up with their care service standards.

Maverick will be alright in the long run.... but Beagle's are no good at waiting years to be fed properly, always on the hunt for a quick easy feed in the near future lol
On a brighter note if the OCR goes down to 0.25% next year like the ANZ think it will and term deposits are about 2% OCA at 4.6% will be a high yielding share :)

Holding OCA until the share price gets a move along (no doubt the overhang the poblem) has been very costly over the last couple of years when taking opportunity cost into account

[BlackPeter]

Holding OCA until the share price gets a move along (no doubt the overhang the poblem) has been very costly over the last couple of years when taking opportunity cost into account

Not everybody bought them as dear as you did ;); My OCA holding returned as of today over a bit more than 2 years roughly 4.5% pa in dividends and about the same amount in capital gains. Not my best performer in the portfolio, but not my worst either.

Just compare that to the (by some people) highly praised TRA - they lost over the same timeframe every year more than 10% (after dividends) for their shareholders.

I like OCA.

[Beagle]

SUM's current share price is $6.33.Their dividend is 13.6 cps which is a 2.15% yield.
Is that a gross yield or a net yield.?
From memory the dividend is not fully imputed,so it looks to be a gross yield.

Gross yield. I don't think anyone buys SUM for the yield. They only pay out 30% of underlying profit and are channeling all the rest into growth.

[Vaygor1]

I wonder if a better alternative to these villages might be to employ a a nice live in filipino nurse/helper, someone to cook and clean etc. Probably work out much cheaper too. Wonder if there are any agencies that supply them? If not there should be
... and don’t tell me that’s not [a racist] because your Filipino comment says otherwise....

I feel compelled to defend Ratkin here. His comment was no more racist than stating that Germans are good at engineering.
Philippinos are the best in the world at the hands-on positions within the service industry... and they know it.
Ref: 1:05 mark at https://www.youtube.com/watch?v=EX_pzn1BYpU

In Singapore and Dubai where I lived for 6 years, there are multiple agencies set up to specifically supply Philippino caregiving, maid, and nanny services who easily make up 90% of those in the role in both the private and public sector. They are brilliant at it, excellent at speaking a range of languages (superb at English), and offer very good value for money. I too think it would be beneficial for all if New Zealand had similar.

[BlackPeter]

I feel compelled to defend Ratkin here. His comment was no more racist than stating that Germans are good at engineering.
Phillipinos are the best in the world at the hands-on positions within the service industry... and they know it.
Ref: 1:05 mark at https://www.youtube.com/watch?v=EX_pzn1BYpU

In Singapore and Dubai where I lived for 6 years, there are multiple agencies set up to specifically supply Philippino caregiving, maid, and nanny services who easily make up 90% of those in the role in both the private and public sector. They are brilliant at it, excellent at speaking a range of languages (superb at English), and offer very good value for money. I too think it would be beneficial for all if New Zealand had similar.

Difficult. I don't think Filipinos are better than others in caring - they are just (due to the poverty in their own country) prepared to work longer hours for less money. For the countries who allow these services it is basically like buying cheap slave labor. Pleasant for the haves ... and who cares for the have-not's.

I think it is an ethical question whether we want to be one of these countries exploiting cheap quasi slave labor.

While I agree that we will (due to our age pyramid and population development) not be able to survive long term without the help of foreign workers (including care staff) would I think that we should make sure these people get fair pay and working conditions. A maid in Singapore (and they have great working conditions compared to some other counties in the region) works basically 24/6. One free day per week. Sure - she is allowed to sleep, but she is always on call.

Give them a fair contract and you need to hire 4 maids instead of one to secure 24/7 service and if you need to pay each of them at least minimum wage instead of a handful of dollars per month, than you might find that our care homes are not that expensive ...

What country do you want to live in?

[ratkin]

I feel compelled to defend Ratkin here. His comment was no more racist than stating that Germans are good at engineering.
Phillipinos are the best in the world at the hands-on positions within the service industry... and they know it.
Ref: 1:05 mark at https://www.youtube.com/watch?v=EX_pzn1BYpU

In Singapore and Dubai where I lived for 6 years, there are multiple agencies set up to specifically supply Philippino caregiving, maid, and nanny services who easily make up 90% of those in the role in both the private and public sector. They are brilliant at it, excellent at speaking a range of languages (superb at English), and offer very good value for money. I too think it would be beneficial for all if New Zealand had similar.

Thanks for that, I too know many filipinos and find them as a group the happiest, and most caring people I know. Quite a few people I know have actually married filipinos, and they all seem pretty happy with their choices. They are all really community orientated, send money to their families etc and generally fit in very well in NZ. Would rather be looked after by one of them than some kiwi who was only doing the job because the dole office sent him/her (cue tirade from the sensitive one)

It was never my intention to suggest I was only interested in one because they were cheap, it was because they would probably do a better job, and be more pleasant to be around

[percy]

Difficult. I don't think Filipinos are better than others in caring - they are just (due to the poverty in their own country) prepared to work longer hours for less money. For the countries who allow these services it is basically like buying cheap slave labor. Pleasant for the haves ... and who cares for the have-not's.

I think it is an ethical question whether we want to be one of these countries exploiting cheap quasi slave labor.

While I agree that we will (due to our age pyramid and population development) not be able to survive long term without the help of foreign workers (including care staff) would I think that we should make sure these people get fair pay and working conditions. A maid in Singapore (and they have great working conditions compared to some other counties in the region) works basically 24/6. One free day per week. Sure - she is allowed to sleep, but she is always on call.

Give them a fair contract and you need to hire 4 maids instead of one to secure 24/7 service and if you need to pay each of them at least minimum wage instead of a handful of dollars per month, than you might find that our care homes are not that expensive ...

What country do you want to live in?

My wife's mother,brother and uncle, have had great care in rest homes from both NZ and Phiippino staff.Three different homes,all same level of excellent care.
The Ryman Elsie Summers' was like a 5 star hotel.

[RupertBear]

Thanks for that, I too know many filipinos and find them as a group the happiest, and most caring people I know. Quite a few people I know have actually married filipinos, and they all seem pretty happy with their choices. They are all really community orientated, send money to their families etc and generally fit in very well in NZ. Would rather be looked after by one of them than some kiwi who was only doing the job because the dole office sent him/her (cue tirade from the sensitive one)

While I dont really wish to enter into this debate I can see why your comments could be construed as being racist. And your comment re “the sensitive one” is actually childish and uncalled for IMO

That being said I also know from personal experience the care a family member has had from a Filipino care giver has been outstanding.

[BlackPeter]

My wife's mother,brother and uncle, have had great care in rest homes from both NZ and Phiippino staff.Three different homes,all same level of excellent care.

And I presume that these hard working Filipino staff had proper NZ work contracts and work hours with the standard wages paid? Great stuff - but this was not what vaygor suggested when he talked about the Filipino maid system in Dubai and Singapore we said we should introduce. These maids earn only a handful of dollars per month, have to work round the clock and are exposed to all sorts of harassment without proper protection.

Sure - they still do a great job (many workers without rights do ...), but I suppose you don't suggest we should re-introduce slave labor in New Zealand?

If you however propose that we should allow more Filipino (and other overseas) nurses and carers on standard NZ working hours and pay into our country to reduce our care crisis than you have no argument from me.

[ratkin]

Oh well, i know I am not racist, and as for the childish comment you are probably right, but hey ho it is what it is.
I will withdraw from the discussion now, because it has all been a bit blown out of proportion, and it is in danger of spiralling into a typical internet war.

[RupertBear]

Oh well, i know I am not racist, and as for the childish comment you are probably right, but hey ho it is what it is.
I will withdraw from the discussion now, because it has all been a bit blown out of proportion, and it is in danger of spiralling into a typical internet war.

Thats fair enough and I agree it has probably been blown out of proportion. I suspect it was just your wording that came across a bit dodgy and you are not a racist. :)

PS I have always valued your posts

[artemis]

I stayed with friends in Hong Kong a few years back, and it was usual to see the maids out in the parks on Sundays- marvelous sight like a massive flock of beautiful birds chatting and laughing together. My friends, who BTW did not have a maid, said it was very common for these women to have a university degree and to stay for a few years only. I asked where the men are, and the answer was they were often in the army. Conscripted they thought.

Closer to home we have, and have had, numerous tenants from the Philippines. Never ever any problems. The rentals are near the hospital and all of the tenants, men and women, have worked there in nursing and midwife roles. Always top of the list for rental vacancies.

[couta1]

I can tell you that Filipino nurses/caregivers are indeed very caring and gentle by nature and are not abusive or rude toward residents which I cannot say for certain other groups to the same degree, make of it what you will.

[Vaygor1]

And I presume that these hard working Filipino staff had proper NZ work contracts and work hours with the standard wages paid? Great stuff - but this was not what vaygor suggested when he talked about the Filipino maid system in Dubai and Singapore we said we should introduce. These maids earn only a handful of dollars per month, have to work round the clock and are exposed to all sorts of harassment without proper protection.

Sure - they still do a great job (many workers without rights do ...), but I suppose you don't suggest we should re-introduce slave labor in New Zealand?

If you however propose that we should allow more Filipino (and other overseas) nurses and carers on standard NZ working hours and pay into our country to reduce our care crisis than you have no argument from me.

These people (Predominantly Phillipinos but also includes those from Sri Lanka, Mynamar, and Indonesia amongst others) are exceptionally well off in Dubai and Singapore compared to the opportunities they get and the pay & conditions they would receive in their country of origin. Would you deny them that? They have found a means to an end.

I am convinced they do a better job in the service industry because (on a general scale) they possess an innate characteristic within their make-up and nature to unreservedly care and help others, and also because they never seem to take the pay and conditions they receive for granted. These two factors would apply in New Zealand and have nothing to do with pay (as they would be on the same payscale as their co-workers by law) and everything to do with value for money.

Excuse me for this subject drifting off-topic somewhat.

[King1212]

Guys...get rid off your old wife! Buy a Filipino one.. guaranteed she will look after u and always happy ending!😃

[justakiwi]

I work with a Filipino caregiver and she is awesome. Genuinely caring and kind and loving towards our residents. But you know what? So am I. I am passionate about my job. I have only been doing it for just under a year but I love it. I can honestly say I put 100% into every shift I work and the people I care for are my number one priority. I have made it my mission to build close and meaningful relationships with our residents so that they know I don't just do this job for the money. I do it because it makes me happy and I do it because I want to make a difference in their lives. They know they can trust me and they know that I really care about them. They miss me when I'm not working, and I miss them. I am good at my job and I am proud of the job I do. The majority of kiwi caregivers are genuine and kind and passionate and provide excellent care to those we look after.

Just so you know.

-"The Sensitive One"

[justakiwi]

Deleted duplicate post

[couta1]

I work with a Filipino caregiver and she is awesome. Genuinely caring and kind and loving towards our residents. But you know what? So am I. I am passionate about my job. I have only been doing it for just under a year but I love it. I can honestly say I put 100% into every shift I work and the people I care for are my number one priority. I have made it my mission to build close and meaningful relationships with our residents so that they know I don't just do this job for the money. I do it because it makes me happy and I do it because I want to make a difference in their lives. They know they can trust me and they know that I really care about them. They miss me when I'm not working, and I miss them. I am good at my job and I am proud of the job I do. The majority of kiwi caregivers are genuine and kind and passionate and provide excellent care to those we look after.

Just so you know.

-"The Sensitive One" You are in the 90% of awesome caregivers so good on you. PS-The 10% of abusive and rude caregivers/nurses are highly unlikely to be Filipinos from my extensive experience in aged care.

[Beagle]

Lets get back to talking about SUM's great growth prospects. Company is on record as saying they're moving up to building ~ 600 units per annual in the next couple of years.
Wonder what FY22 underlying profit looks like ? This dog thinks one is best to put the long range sniffer to work on this, look through the present real estate market funk and think about where underlying earnings are going to be in a few years time then put a mid teens multiple on that.

[macduffy]

Thanks, doggy, for bringing this SUM thread back onto its investment merits track. As a holder, I'm bullish about them too!

:)

[couta1]

Thanks, doggy, for bringing this SUM thread back onto its investment merits track. As a holder, I'm bullish about them too!

:) Well I'm making SUM fast tracks today of the snowy kind, whoops I'm getting off track and the hound will be along soon to get things back on track in quick order. PS-This one of the only companies on the NZX that I would buy currently if I wasn't all milked out.

[winner69]

Lets get back to talking about SUM's great growth prospects. Company is on record as saying they're moving up to building ~ 600 units per annual in the next couple of years.
Wonder what FY22 underlying profit looks like ? This dog thinks one is best to put the long range sniffer to work on this, look through the present real estate market funk and think about where underlying earnings are going to be in a few years time then put a mid teens multiple on that.

If thet delivered 600 units in 2022 and only sold 550 of them and there was only modest increses in property prices I reckon Underlying Earnings would be $190m / $200m (say EPS of 90 cents)

A modest PE would see share price over $11 then

Heck thats nearly double in next 4 years .... what do they say about the rule of 72 ,,,,,18% pa return

[Beagle]

If we applied an average PE of 15 to that 90 cents it could be 90 x 15 = $13.50 3-4 years from now...more than double your money.
I think its a healthy thing to extrapolate forward...motivates one to stay on course.

[couta1]

If we applied an average PE of 15 to that 90 cents it could be 90 x 15 = $13.50 3-4 years from now...more than double your money.
I think its a healthy thing to extrapolate forward...motivates one to stay on course. Gee Beagle I'm sure RYM holders gunna be pretty happy with a SP of $27 3-4 yrs from now.

[Beagle]

Gee Beagle I'm sure RYM holders gunna be pretty happy with a SP of $27 3-4 yrs from now.

LOL CA can't ever be wrong :)

[Beagle]

http://www.sharechat.co.nz/article/020eb5a6/house-price-inflation-rekindles-but-low-sales-volumes-suggest-caution.html?utm_medium=email&utm_campaign=House%20price%20inflation%20rekindles %20but%20low%20sales%20volumes%20suggest%20caution&utm_content=House%20price%20inflation%20rekindles% 20but%20low%20sales%20volumes%20suggest%20caution+ CID_e4e2da7d0e5a9c3785fb034859778830&utm_source=Email%20marketing%20software&utm_term=httpwwwsharechatconzarticle020eb5a6house-price-inflation-rekindles-but-low-sales-volumes-suggest-cautionhtml

House prices doing well. Heck even Auckland on the up and up in recent months and nationally house prices are up 6.5% on last year.
This can't be right...all the naysayers were telling us doomsday was just around the corner...and that was just a couple of months ago when the share price was mid $5's.
Technically the chart is looking very good but who needs technical or fundamental analysis when you have Couta analysis :) 60% relativity to RYM = $7.89, here we come :)

[winner69]

http://www.sharechat.co.nz/article/020eb5a6/house-price-inflation-rekindles-but-low-sales-volumes-suggest-caution.html?utm_medium=email&utm_campaign=House%20price%20inflation%20rekindles %20but%20low%20sales%20volumes%20suggest%20caution&utm_content=House%20price%20inflation%20rekindles% 20but%20low%20sales%20volumes%20suggest%20caution+ CID_e4e2da7d0e5a9c3785fb034859778830&utm_source=Email%20marketing%20software&utm_term=httpwwwsharechatconzarticle020eb5a6house-price-inflation-rekindles-but-low-sales-volumes-suggest-cautionhtml

House prices doing well. Heck even Auckland on the up and up in recent months and nationally house prices are up 6.5% on last year.
This can't be right...all the naysayers were telling us doomsday was just around the corner...and that was just a couple of months ago when the share price was mid $5's.
Technically the chart is looking very good but who needs technical or fundamental analysis when you have Couta analysis :) 60% relativity to RYM = $7.89, here we come :)

Good about those property prices eh beagle .....even better seeing we are probably in a recession or close to it (ASB say so)

[tipsy]

Some nice gains over the last 3 months, Regretting only buying back 1/4 of what I sold in the high 7's.

[Beagle]

Good about those property prices eh beagle .....even better seeing we are probably in a recession or close to it (ASB say so)

GDP growth came out okay this week as did real estate prices.

[Leftfield]

First Australian land purchase announced. (https://www.nzx.com/announcements/341428)

Good timing in terms of property cycles. Beagle be happy?

[Beagle]

First Australian land purchase announced. (https://www.nzx.com/announcements/341428)

Good timing in terms of property cycles. Beagle be happy?

I like the way they've done really thorough due diligence on the whole Australian expansion thing. They have a large amount of land in N.Z. for development too.
I think its crystal clear there's a lot of growth coming with this company in the years ahead and the current forward PE is quite undemanding at about 13.

[tipsy]

Is that Beagle with a cheeky ask of 14.70?

[peat]

Is that Beagle with a cheeky ask of 14.70?

lol I'm surprised that offer was accepted into the bidding system.

[Beagle]

Is that Beagle with a cheeky ask of 14.70?

LOL seems like fair value to me :D

[Beagle]

Back to just on ~ 50% of RYM...was always just a question of when not if.
Surprised the main supporter of this conceptual theory wasn't all over this at 42% price relativity more than $1 lower than now..

[couta1]

Back to just on ~ 50% of RYM...was always just a question of when not if.
Surprised the main supporter of this conceptual theory wasn't all over this at 42% price relativity more than $1 lower than now.. I was and are all milked out as you know and have a very focussed and concentrated portfolio these days. PS-Doesnt mean others cant use and take advantage of the Gold Standard CA though.

[Beagle]

I was and are all milked out as you know and have a very focussed and concentrated portfolio these days. PS-Doesnt mean others cant use and take advantage of the Gold Standard CA though.

Quite right, I've milked it :) Its not over yet, 60% price relativity to RYM here we come !

[King1212]

https://www.newshub.co.nz/home/politics/2019/09/credit-ratings-agency-moody-s-gives-glowing-assessment-of-new-zealand-economy.html

No signs of recession... interest rate low... properties price will keep going up

[tipsy]

https://www.newshub.co.nz/home/politics/2019/09/credit-ratings-agency-moody-s-gives-glowing-assessment-of-new-zealand-economy.html

No signs of recession... interest rate low... properties price will keep going up

'Rockstar economy' :p

[winner69]

Finally got there after a while — SUM shareprice 50% of RYM (fractionally more)

Reversion to mean amazing thing eh

Chances are the ratio will increase from here — otherwise we wouldn’t have reversion to the mean would we

Go SUM ....don’t rely on RYM weakening

[Beagle]

Happy holder and a real believer in retirement village living. Much is made of the financial aspects of these villages but how about this !
My Mum has been in her retirement village for just over a decade now and really loves the caring community there and its made a massive difference to her quality of life since Dad died nearly 8 years ago. She's always pretty busy for her age and really gets involved in village community life.
Great example is she turned 90 today and they had a nice function in the local village centre and heaps of people made a real fuss of her and she is so happy.
Many relatives have flown in from around the country and there's a big extended family get together this weekend and she is being made a fuss of tomorrow as well.
Happy days !!

[penn]

Nice post Beagle! That there is what it's all about. I was a happy holder a few years back, and then I saw how the s/p had been hammered a few months back, and am very happy to get back in then. There was some very aggressive buying into the close today, so may fall back a bit in the morning, but just seems to have the right formula at the moment. keenly looking for $7 here. And from the famous 'couta' on here ;)

[Baa_Baa]

Nice post Beagle! That there is what it's all about. I was a happy holder a few years back, and then I saw how the s/p had been hammered a few months back, and am very happy to get back in then. There was some very aggressive buying into the close today, so may fall back a bit in the morning, but just seems to have the right formula at the moment. keenly looking for $7 here. And from the famous 'couta' on here ;)

It was a nice post from Beagle eh, hope his mum's birthday went well. The TA is looking good as well, today was a breakout from the last remain downward trend line from back in Sept last year. I see only modest price resistance at the 50% fib retrace $6.67 through to $6.80, then a slog from there through a resistance band to test of $7.

As has also been pointed out, the FA is terrific and in these low interest rate times it looks like SUM's positive SP movement off the $5.30-40 low has something to do with people realising a price suppressed asset that has a long term earning and yield profile.

[Baa_Baa]

Golden Cross as well, just inside a few thousandths. :t_up:

- 50MA $6.0006
- 200MA $6.0054

[Beagle]

Mum had an awesome week catching up with friends and family and all celebrations went well, thanks.
From the annual meeting in April, Julian Cook assured the meeting after their very long and thorough due diligence in Australia their Australian expansion would only happen if the numbers looked very good so I am assuming they bought that Melbourne land and have village construction costings that look very attractive.
The expansion over there looks well timed with many commentators opining that the market there has bottomed.
I think its clear their unbroken track record of underlying earnings growth will continue, albeit at more RYM type level's. As we know 15% underlying earnings growth (by simple compounding) leads to the doubling of underlying earnings every five years and I think that's what they're now aiming for.

We should have the Sept quarter sales stat's next week and if those are as good as the share price is indicating they are then she's onward and upward.

[penn]

Thanks B
I like the buy sell table (that I can see) 10,000 shares before the cheeky $14.70 get's hit would love to see someone get to buy just one of those at $14.70, that would turn a few heads! I just don't have that sort of 'fire power' ;)

[winner69]

Mum had an awesome week catching up with friends and family and all celebrations went well, thanks.
From the annual meeting in April, Julian Cook assured the meeting after their very long and thorough due diligence in Australia their Australian expansion would only happen if the numbers looked very good so I am assuming they bought that Melbourne land and have village construction costings that look very attractive.
The expansion over there looks well timed with many commentators opining that the market there has bottomed.
I think its clear their unbroken track record of underlying earnings growth will continue, albeit at more RYM type level's. As we know 15% underlying earnings growth (by simple compounding) leads to the doubling of underlying earnings every five years and I think that's what they're now aiming for.

We should have the Sept quarter sales stat's next week and if those are as good as the share price is indicating they are then she's onward and upward.

.....along with a real positive earnings guidance I reckon

Share price to hit 7 bucks by Guy Fawkes

[jg8512]

more rest home closures.
https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12272602

not new news,
but confirmation is positive (for holders in the growing providers, obviously much less so for current residents of facilities which are closing)

[justakiwi]

Good news for shareholders but a huge worry for our elderly folk who, will not be able to afford the likes of SUM and RYM. Where are these people going to go if they need rest home care or hospital level rest home care>


more rest home closures.
https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12272602

not new news,
but confirmation is positive (for holders in the growing providers, obviously much less so for current residents of facilities which are closing)

[couta1]

Good news for shareholders but a huge worry for our elderly folk who, will not be able to afford the likes of SUM and RYM. Where are these people going to go if they need rest home care or hospital level rest home care> They can go to a SUM or RYM facility like anyone else can with a Govt subsidy to cover their costs if they cant pay.

[justakiwi]

I understand that, but I assume SUM and RYM charge a significantly higher weekly rate than non-profit rest homes do, which would mean the government subsidy would have to increase OR residents would have to find money from somewhere to top the subsidy up. If all the non-profit rest homes close over the next however many years, will the government be able to sustain higher subsidies to SUM/RYM in the future, and for much longer periods of time, given than residents money will run out much more quickly than it would in the less expensive rest homes?

Does anyone know if the govt subsidy for SUM/RYM is the same as for other rest homes now, or higher?


They can go to a SUM or RYM facility like anyone else can with a Govt subsidy to cover their costs if they cant pay.

[couta1]

I understand that, but I assume SUM and RYM charge a significantly higher weekly rate than non-profit rest homes do, which would mean the government subsidy would have to increase OR residents would have to find money from somewhere to top the subsidy up. If all the non-profit rest homes close over the next however many years, will the government be able to sustain higher subsidies to SUM/RYM in the future, and for much longer periods of time, given than residents money will run out much more quickly than it would in the less expensive rest homes?

Does anyone know if the govt subsidy for SUM/RYM is the same as for other rest homes now, or higher? Subsidy amounts are determined and set by area rather than the company standing, premium room charges apply of course but these rooms are in the minority so wouldn't affect these people anyway.

[TideMan]

I got an email saying that SUM is getting into Oz.
Will this be another NZ company that works OK in NZ, but finds Oz to be a graveyard?
Should I get now?

[Beagle]

SUM's due diligence in terms of its expansion into Australia has been extremely thorough and it looks like their first land acquisition was right at the bottom of the cycle.

[couta1]

SUM's due diligence in terms of its expansion into Australia has been extremely thorough and it looks like their first land acquisition was right at the bottom of the cycle. And we know how tight they are with parting with their money aye Beagle.

[Beagle]

And we know how tight they are with parting with their money aye Beagle.

LOL Yes, we certainly do !

[winner69]

Q3 sales out next week

Last year they reported 148 sales (including 82 new)

Anything higher than that will stop the rot (ie down trend in sales numbers)

I expect to see a number between 170 and 180 with hopefully new sales close to 100.

That will excite the market.

Doesn’t really matter what the number is though because this years earnings are underpinned by the extraordinary increased valuations over 2017/2018

Good times ahead for shareholders

[winner69]

Q3 sales out next week

Last year they reported 148 sales (including 82 new)

Anything higher than that will stop the rot (ie down trend in sales numbers)

I expect to see a number between 170 and 180 with hopefully new sales close to 100.

That will excite the market.

Doesn’t really matter what the number is though because this years earnings are underpinned by the extraordinary increased valuations over 2017/2018

Good times ahead for shareholders

So it was 165. A bit of a disappointment.

Resales going gangbusters - that’ll help Underlying Earnings with all those recent revaluations

New sales down again

Odd Julián says Mr Cook said new sales maintained the momentum reported in the first half.

Yes Julián the rate of decline maintained its momentum ...so true what you said

Mystery shopping mot working obviously

[winner69]

Numbers so bad I won’t even update my charts — i’ll leave that up to BP

[winner69]

Julián says ‘total sales were aligned with expectations’

Jeez Julián - you have low expectations .....and did you tell the market about your low expectations.

[BlackPeter]

So it was 165. A bit of a disappointment.

Resales going gangbusters - that’ll help Underlying Earnings with all those recent revaluations

New sales down again

Odd Julián says Mr Cook said new sales maintained the momentum reported in the first half.

Yes Julián the rate of decline maintained its momentum ...so true what you said

Mystery shopping mot working obviously

Well - might be time to look at it from a glass half full perspective. This is the first time in 5 quarters that the rolling sales total is going up again ... Clearly a trend change ... do I sense a bell shaped recovery :p?

10795

[Beagle]

Julián says ‘total sales were aligned with expectations’

Jeez Julián - you have low expectations .....and did you tell the market about your low expectations.

Resales are going gangbusters.

[winner69]

Well - might be time to look at it from a glass half full perspective. This is the first time in 5 quarters that the rolling sales total is going up again ... Clearly a trend change ... do I sense a bell shaped recovery :p?

10795

Yes a positive quarter but bear in mind they make heaps more on selling new things than resales....and that pale blue line looks a bit sad eh

[winner69]

Resales are going gangbusters.

As they say in the analyst business probable a random spike in a volatile series of numbers

Same quarter last year was an abysmally low 66 so even 88 this year isn’t really fantastic

[Beagle]

As they say in the analyst business probable a random spike in the numbers

Or the start of a new trend ? Resales numbers based on my calculations based on normal length of stay and total number of units owned have been extraordinarily low in the last couple of years. Resales will really drive profit growth in the next 3 years. (That's what the market isn't understanding at this point).

[winner69]

Odd Julián ‘new sales maintained the momentum reported in the first half.’

Yes he’s right — new sales in first half down 6% on pcp — new sales Q3 down 6% on pcp.

Only reason Julián would make such a statement is if he assumed punters expected things to get worse and would be than 6% down in Q3

But then he said sales mer expectations.

[winner69]

Or the start of a new trend ? Resales numbers based on my calculations based on normal length of stay and total number of units owned have been extraordinarily low in the last couple of years. Resales will really drive profit growth in the next 3 years. (That's what the market isn't understanding at this point).

Yes indeed - all those extraordinary revaluation gains over the last few years to be realised.

But they make more than double the bucks from selling a new thing than a used one.

[artemis]

More deaths in winter. So more resales.

[BlackPeter]

While it is true that more people are typically dying during winter than during the more friendly seasons - if you look at the resale trend I published (the purple line), it does not really show seasonal tendencies.

As well - after a unit is vacated, they first need to renovate it and put it on the market ... I think in average it is something like 3 or 4 months from vacating the unit to reselling it; Any deaths during this winter would not have contributed to Q3 resales.

I think resale numbers are more likely dependent on the average age of the residents and the overall number of units available ... and all three average age, number of units as well as resale numbers are clearly trending up.

[Beagle]

Agreed BP.

[Lease]

I view the numbers are good: new sales are better than Q1 and Q2. Resales are the best over last six quarters.

What else you guys expect?

[Beagle]

I view the numbers are good: new sales are better than Q1 and Q2. Resales are the best over last six quarters.

What else you guys expect?

Well said. Up 11.5% on the same quarter last year too http://www.sharechat.co.nz/article/7dfdf7d5/summerset-s-3q-sales-up-11-5-on-the-year.html?utm_medium=email&utm_campaign=Summersets%203Q%20sales%20up%20115%20 on%20the%20year&utm_content=Summersets%203Q%20sales%20up%20115%20o n%20the%20year+CID_3467c162ec597636e03fff2f25e0d63 b&utm_source=Email%20marketing%20software&utm_term=httpwwwsharechatconzarticle7dfdf7d5summer set-s-3q-sales-up-11-5-on-the-yearhtml

[freddagg]

I view the numbers are good: new sales are better than Q1 and Q2. Resales are the best over last six quarters.

What else you guys expect?

The only one who is negative is Winner and all that means is that he is wanting to buy.

[Beagle]

The only one who is negative is Winner and all that means is that he is wanting to buy.

:lol: :lol:

[LAC]

Steady as she goes. Happy with that:)

[44wishlists]

Steady as she goes. Happy with that:)

Very steady indeed..."Summerset shares last traded at $6.41 and have been virtually flat, rising just 0.6 percent so far this year. "

[Beagle]

Except they're $6.50 now and lowest offer is $6.60. Winner must have been buying like crazy when he realised the game was up on his negativity, (Sorry Winner me ol mate, I'm a naughty dog and couldn't help myself :D)

[winner69]

Sales numbers don’t really matter at the moment......as long as they don’t go decline much

Earnings growth over the next few years is coming from the extraordinary revaluations of recent years.

Chart below is much is realised per sale (ie underlying earnings). Looks pretty good eh. The lines will continue to go up at a solid rate as the recent extraordinary revaluations are realised.

Even if F19 sales are the same as F18 Underlying Earnings will be about $115m. That’s taking into account past revaluations and profile of new builds.

So Underlying Earnings likely to grow by 17%/20% even without selling any more things. Sell more than last year and even greater earnings growth

Pretty good eh ....unlike that other much beloved sector player that sells heaps more for no or little earnings growth.

[Beagle]

Cheapest growth stock on the NZX in my opinion. Julian is relentless when it comes to keeping costs in check, unlike some other CEO's who think their primary role is to be a people pleaser.

[Lease]

Cheapest growth stock on the NZX in my opinion. Julian is relentless when it comes to keeping costs in check, unlike some other CEO's who think their primary role is to be a people pleaser.

Ya, I agree, I've just added some on.

[Bobdn]

If interest rates go to zero or negative, with a dividend yield of just over 2 per cent this will be seen as an income and growth stock :)

[LAC]

Very steady indeed..."Summerset shares last traded at $6.41 and have been virtually flat, rising just 0.6 percent so far this year. "

With such a great business, who even cares if the market prices them at $6.41 or $7.41? All i know is that the Market will realize in time what a great business this is. The business is soooo good that W69 is using reverse psychology on us today.

[Beagle]

Cheapest growth stock on the NZX in my opinion. Julian is relentless when it comes to keeping costs in check, unlike some other CEO's who think their primary role is to be a people pleaser.

Backed that up by topping up with SUM more today.

[Beagle]

I see SUM have a new brand ambassador. https://www.summerset.co.nz/about-us/summerset-ambassador/
That's more cunning than a hungry Beagle, who wouldn't trust anything Jude Dobson said :)
Have a look at their Hobsonville village. This dog has had a good look around said village and am very impressed with the waterfront units !
https://www.youtube.com/watch?v=1DdyGoSzjXs

Summerset confidence https://www.youtube.com/watch?v=cHC3TithchU

Summerset has staged a very good recovery in the last 2 months since Jude came on board and made these video's, up more than $1. Coincidence or very clever marketing ?, you be the judge.

[Baa_Baa]

I see SUM have a new brand ambassador. https://www.summerset.co.nz/about-us/summerset-ambassador/
That's more cunning than a hungry Beagle, who wouldn't trust anything Jude Dobson said :)
Have a look at their Hobsonville village. This dog has had a good look around said village and am very impressed with the waterfront units !
https://www.youtube.com/watch?v=1DdyGoSzjXs

Summerset confidence https://www.youtube.com/watch?v=cHC3TithchU

Summerset has staged a very good recovery in the last 2 months since Jude came on board and made these video's, up more than $1. Coincidence or very clever marketing ?, you be the judge.

You sound like Percy, more as every day goes by. Soon you’ll be ‘well positioned’

😂

[Beagle]

No No No ! This dog barks to his own tune :) https://www.youtube.com/watch?v=nCTr-4CoeVs

[Blue Skies]

I see SUM have a new brand ambassador. https://www.summerset.co.nz/about-us/summerset-ambassador/
That's more cunning than a hungry Beagle, who wouldn't trust anything Jude Dobson said :)
Have a look at their Hobsonville village. This dog has had a good look around said village and am very impressed with the waterfront units !
https://www.youtube.com/watch?v=1DdyGoSzjXs

Summerset confidence https://www.youtube.com/watch?v=cHC3TithchU

Summerset has staged a very good recovery in the last 2 months since Jude came on board and made these video's, up more than $1. Coincidence or very clever marketing ?, you be the judge.


Agreed, an excellent move, they are lucky to get her, will really lift their marketing, she's a v good broadcaster as well as having tons of credibility, warmth, integrity etc.
I imagine moving into a retirement village is quite an emotional decision, not just dollars & cents, and marketing built around EQ rather than just bricks and mortar seems to work. (e.g. Ryman)
Wish OCA would pick up on this.

[Beagle]

Jude Dobson really is lovely and I think she is going to have a tremendous positive influence in the years ahead.

[percy]

Jude Dobson really is lovely and I think she is going to have a tremendous positive influence in the years ahead.

And her influence will be positively felt by others in the sector.

[Beagle]

And her influence will be positively felt by others in the sector.

True...but she's endorsing SUM so will have by far the biggest positive influence there...which makes me think I should get SUM more :)
Forward PE is about 13, (in a few months will be historic PE), and with their track record of earnings growth...crikey its hard to see how one is not going to do extremely well indeed in the long run.
Julian highly motivated, has heaps of his own shares now.

[winner69]

Jude Dobson really is lovely and I think she is going to have a tremendous positive influence in the years ahead.

Likes dogs as well ....not beagles but had a weimaraner

[allfromacell]

Seems like a there's a rocket is back under house prices, very solid recovery over the past 3 months.

https://www.reinz.co.nz/Media/Default/Statistic%20Documents/2019/Residential/September/REINZ%20Monthly%20HPI%20Report%20-%20September%202019.pdf?fbclid=IwAR0kiFlArb6CmR8_w 2WhaAlBbirsLbVpN1r_ncxNtXsgDZOkYml50pjZZFw

[Beagle]

Cool how you got this 3 days before it was officially due to be released :cool:

[winner69]

Cool how you got this 3 days before it was officially due to be released :cool:

On their website ...they often publish the Gold Standard HPI before the othervreportbthst has sales numbers and median prices etc

[Beagle]

"Gold standard HPI" for those that think it really is the gold standard says real estate (ex Auckland) up 7.7% for the year. That can't be right. All the dooms-dayers have been telling us for ages that property was going to fall off the face of a cliff. Wonder what happens with the RBNZ cuts the OCR to just 0.5% next month ?

[winner69]

"Gold standard HPI" for those that think it really is the gold standard says real estate (ex Auckland) up 7.7% for the year. That can't be right. All the dooms-dayers have been telling us for ages that property was going to fall off the face of a cliff. Wonder what happens with the RBNZ cuts the OCR to just 0.5% next month ?

And if you look at the chart on Page 4 not much of slow down over the last few years ...and even recently is there?

Don’t listen to bank economists or the media ....just look at facts and long term charts to elinate the short term noise

[Ggcc]

Wonder what happens with the RBNZ cuts the OCR to just 0.5% next month ?

Leveraging, loads of leveraging.... Prices will keep going up and people will just keep borrowing, until the banks ask for their money back quickly....

[Beagle]

Summerset acquired a retirement village site in Cranbourne North, near Melbourne. This is its first site for development in Australia. This type of acquisition was well foreshadowed by the company and does not settle until early 2021.
The company will progress planning in the meantime. The village adds to its New Zealand development pipeline and units will likely be available for sale commencing late 2021 or early 2022. We view this as Summerset executing to plan and there are other similar opportunities in the pipeline.
Extract from Kingfish's monthly investment report released to the NZX this morning. Despite RYM having a market cap many times more than SUM I note their holding in SUM is bigger than RYM and now their fifth biggest holding at 8% of their portfolio.

[winner69]

Good day on the bourse for SUM - up 1.5% to $6.70

RYM did better being 2.5% up

Seems both about fair value (according to the market) at the moment

[couta1]

Good day on the bourse for SUM - up 1.5% to $6.70

RYM did better being 2.5% up

Seems both about fair value (according to the market) at the moment Bang on the 50% ratio so fair value at the mean, spooky eh.

[winner69]

Bang on the 50% ratio so fair value at the mean, spooky eh.

Really really spooky mate - although some will never never believe it

[winner69]

Extract from Kingfish's monthly investment report released to the NZX this morning. Despite RYM having a market cap many times more than SUM I note their holding in SUM is bigger than RYM and now their fifth biggest holding at 8% of their portfolio.

Last time I looked even The Queen has more $ in Summerset than Ryman

So you in good company doing like Kingfish and The Queen

[Beagle]

Maybe Carmel loves Corgi's too :)

[winner69]

Property market booming - September stats

Median Prices up 6,6% .....sales volumes up ...days to sell down

https://www.reinz.co.nz/Media/Default/Statistic%20Documents/2019/Residential/September/REINZ%20Monthly%20Property%20Report%20-%20September%202019.pdf

Maybe my estimate of realised gains per sale a bit light.....my forecast is now Underlying Earnings ~$120m even if sales are only the same as last year

[Beagle]

Property market booming - September stats

Median Prices up 6,6% .....sales volumes up ...days to sell down

https://www.reinz.co.nz/Media/Default/Statistic%20Documents/2019/Residential/September/REINZ%20Monthly%20Property%20Report%20-%20September%202019.pdf

Maybe my estimate of realised gains per sale a bit light.....my forecast is now Underlying Earnings ~$120m even if sales are only the same as last year

Crikey that's a solid result and RBNZ almost certain to cut again next month so we're off to the races.
$120m on 226.8m shares..oh my goodness that's just on 53 cps underlying earnings per share. RYM made $227m last year and if they generate another 11.5% underlying earnings increase like last year that's $253m on 500m shares = underlying eps of 50.6 cps.
Looks like underlying eps of SUM for the year ended 31 December 2019 might exceed RYM's result for the year ended 31 March 2020....but of course its completely "stupid" to think SUM's shares are worth anything more than half the mighty RYM eh...or is it ?

[winner69]

Crikey that's a solid result and RBNZ almost certain to cut again next month so we're off to the races.
$120m on 226.8m shares..oh my goodness that's just on 53 cps underlying earnings per share. RYM made $227m last year and if they generate another 11.5% underlying earnings increase like last year that's $253m on 500m shares = underlying eps of 50.6 cps.
Looks like underlying eps of SUM for the year ended 31 December 2019 might exceed RYM's result for the year ended 31 March 2020....but of course its completely "stupid" to think SUM's shares are worth anything more than half the mighty RYM eh...or is it ?

....but that's how the world works ....spooky eh

Even NIWA and Met Office can't agree on the weather - I could have told you that it was going to windy and wet up your way today

[Beagle]

5 years a pretty useful timeframe to determine which business model is working best for shareholders.
SUM up 155%, RYM up 80%. 10808 That's nearly double the return...I wonder if that's what happens when you buy at half the price ?
Maybe a repeat over the next 5 years ?
Westpac predicts 7% house price increase next year https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12276625
Funny how those predicting real estate prices was going to fall off a cliff have gone strangely quiet isn't it !

[dreamcatcher]

WOW!!........... the Beagles on a roll ATH coming up

“Whilst the Auckland region saw an increase, it’s too early to call this a trend – especially as the median price has returned to around the $850,000 mark where we’ve seen median prices sit for a few years now,” point out Norwell.

[Beagle]

Bet you MET shareholders wished the vast majority if their villages were outside Auckland.

[winner69]

5 years a pretty useful timeframe to determine which business model is working best for shareholders.
SUM up 155%, RYM up 80%. 10808 That's nearly double the return...I wonder if that's what happens when you buy at half the price ?
Maybe a repeat over the next 5 years ?
Westpac predicts 7% house price increase next year https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12276625
Funny how those predicting real estate prices was going to fall off a cliff have gone strangely quiet isn't it !

Nice chart and gives us hope eh - widhful thinking

Reversion to the mean has caused this and reversion to the mean will rule in future

[couta1]

Nice chart and gives us hope eh - widhful thinking

Reversion to the mean has caused this and reversion to the mean will rule in future Yep will always revert back to half the value of RYM. Lol

[winner69]

As Beagle points out last 5 years SUM up 155%, RYM up 80%

SUM gone from 37% of RYM share price (RYM overvalued) to current 50% (did pass through 60% on the journey though but we wont puy up the relative chart of that period)

Reversion to the mean mate, not company performance, main driver

[couta1]

As Beagle points out last 5 years SUM up 155%, RYM up 80%

SUM gone from 37% of RYM share price (RYM overvalued) to current 50% (did pass through 60% on the journey though but we wont puy up the relative chart of that period)

Reversion to the mean mate, not company performance, main driver Yeah forget TA and FA and just stick will CA.

[winner69]

In Nov 2011 shortly after floating the SUM share price was a fraction of 50% of the RYM share price

Good day today on the bourse for both and the SUM share price is a fraction over 50% of the RYM share price

Shareholders have made heaps in those EIGHT years from both but the relativity between the two remains the same.

That’s how the world works ......and well entrenched things generally don’t change.

I’m looking forward to the RYM share price getting to $20

[Beagle]

For many years they had similar forward PE's based on underlying earnings, now somewhere around half the PE for SUM compared to RYM despite their SP performance being double that of RYM in the last 5 years.

Wonder what SUM's underlying earnings will be in FY21 if they lift their build rate to 600 units per annum and the real estate market stays buoyant ?
That's the $64,000 question to think about...

[Baa_Baa]

Been a good run up in the SP since low $5's, presenting at the time excellent accumulation or buy in opportunity, with hindsight. I'm grateful for having had the opportunity and take a more substantial position.

Currently SP is about to enter a fairly strong technical price resistance band by my calc's, ranging from $6.80 up to $7. The golden cross last week on the weekly chart (using 17/43 EMA's) is most encouraging.

Marketscreener gets quoted a bit around here, their average analysts target price has crept up to $7.06, only 4c shy of the Forbar TP $7.10 set 14 August (which was much maligned at the time).

[winner69]

Sum good insights in this ANZ report about the sector here and in AUstralia

https://comms.anz.co.nz/static/pobb-cms/pdf/ANZ-Retirement-Village-Sector-Insight-2019-A-Trans-Tasman-view.pdf


IN THE NEXT 12-24 MONTHS, IF HOUSE PRICES FALL IN YOUR CITY,
WILL YOU PROVIDE SPECIAL INCENTIVES OR OFFERS?
Australia - 43% respond YES and NZ 26% respond YES

and

if 62% of NZ operators who say they will be sharing capital gains actually do whats the impact on profitability?

[Maverick]

Sum good insights in this ANZ report about the sector here and in AUstralia

https://comms.anz.co.nz/static/pobb-cms/pdf/ANZ-Retirement-Village-Sector-Insight-2019-A-Trans-Tasman-view.pdf


IN THE NEXT 12-24 MONTHS, IF HOUSE PRICES FALL IN YOUR CITY,
WILL YOU PROVIDE SPECIAL INCENTIVES OR OFFERS?
Australia - 43% respond YES and NZ 26% respond YES

and

if 62% of NZ operators who say they will be sharing capital gains actually do whats the impact on profitability?
Thanks for the link Winner, the way I read it seems that all is VERY well in the sector.

[macduffy]

Sum good insights in this ANZ report about the sector here and in AUstralia

https://comms.anz.co.nz/static/pobb-cms/pdf/ANZ-Retirement-Village-Sector-Insight-2019-A-Trans-Tasman-view.pdf


IN THE NEXT 12-24 MONTHS, IF HOUSE PRICES FALL IN YOUR CITY,
WILL YOU PROVIDE SPECIAL INCENTIVES OR OFFERS?
Australia - 43% respond YES and NZ 26% respond YES

and

if 62% of NZ operators who say they will be sharing capital gains actually do whats the impact on profitability?

I think you've misread the sharing of capital gains, winner. The 62% said "No"!

[winner69]

I think you've misread the sharing of capital gains, winner. The 62% said "No"!

I did too ...that’s a relief, we don’t want too be too generous do we.

[Beagle]

I did too ...that’s a relief, we don’t want too be too generous do we.

:lol: :lol: Thanks for the report mate...will read when I have the time.

[winner69]

Another week and another month and still SUM share price 50% of RYM share price

Wish RYM would get a move along soon ...and drag SUM up with it.

[winner69]

Good news re Australian dwelling prices......also means the positive signs in NZ might gain further momentum.

The correction in Australian dwelling prices that began in late 2017 ended in mid-2019 with prices showing a clear lift since mid-year. The CoreLogic home value index, covering the eight major capital cities rose 1.4% in Oct following a 1.1% gain in September and a 1% gain in August. Prices are still down 2.4%yr but the turning point has clearly passed with prices tracking towards being flat for the 2019 calendar year.



https://westpaciq.westpac.com.au/wibiqauthoring/_uploads/file/Australia/2019/November/er20191101BullDwellPricesOct2.pdf

[Beagle]

That 50% relativity to RYM sure is sticky ! Good thing is the higher RYM goes the better. another 10% is worth only another $1.30 now so when RYM is $20 in a few years and SUM breaks out to 70% price relativity that's another 20% or $4 on the price v $10 it would have been if this silly 50% thing hung around forever. SUM to be $14-$15 in 3-4 years. The dog barked it first !
https://www.abc.net.au/news/2019-11-01/house-price-rebound-accelerates-in-october/11661400?section=business&utm_source=ST&utm_medium=email&utm_campaign=ShareTrader+AM+Update+for+Saturday+2+ November+2019

Looks like SUM timed their recent entry into Australia perfectly !

[winner69]

That 50% relativity to RYM sure is sticky ! Good thing is the higher RYM goes the better. another 10% is worth only another $1.30 now so when RYM is $20 in a few years and SUM breaks out to 70% price relativity that's another 20% or $4 on the price v $10 it would have been if this silly 50% thing hung around forever. SUM to be $14-$15 in 3-4 years. The dog barked it first !
https://www.abc.net.au/news/2019-11-01/house-price-rebound-accelerates-in-october/11661400?section=business&utm_source=ST&utm_medium=email&utm_campaign=ShareTrader+AM+Update+for+Saturday+2+ November+2019

Looks like SUM timed their recent entry into Australia perfectly !

Sure is sticky. You’ve got to live with some things that revert to the mean, reoccur and things like that. It’s almost like it’s natures way.

Like the Springboks win the RWC every 12 years ...spooky eh

So in 2031 the Springboks will win the RWC again and the SUM share price will still be about 50% of the RYM share price.

[Beagle]

Sure is sticky. You’ve got to live with some things that revert to the mean, reoccur and things like that. It’s almost like it’s natures way.

Like the Springboks win the RWC every 12 years ...spooky eh

So in 2031 the Springboks will win the RWC again and the SUM share price will still be about 50% of the RYM share price.

LOL the old financial advisors saying springs to mind “Past performance is no guarantee of future results” It'll be interesting to see what happens when SUM is making more underlying eps per share than RYM. As a numbers man I will always believe that earnings matter and in the long term share prices follow earnings.

SUM day, when SUM's underlying eps is greater than RYM's I might back that up with doubling down on SUM and shorting RYM to hedge my position then when Coutts theory is completely shikkered I'll be a very happy dog.

[winner69]

As a numbers man I will always believe that earnings matter and in the long term share prices follow earnings.



So true - very wise

And SUM is a great example - as earnings have grown over the years the share price has followed

Cool eh

[Beagle]

Very cool. Top two blokes are very bright and highly motivated. Good board too although the caveat to that now is that Rob Campbell has too much on his plate.

[winner69]

Very cool. Top two blokes are very bright and highly motivated. Good board too although the caveat to that now is that Rob Campbell has too much on his plate.

Rob's desire to grow companies by buying things overseas has had a bit of a chequered history

[Beagle]

Rob's desire to grow companies by buying things overseas has had a bit of a chequered history

Sure has but we'll be fine because its Julian Cook that's keen on the Australian expansion.

[winner69]

Sure has but we'll be fine because its Julian Cook that's keen on the Australian expansion.

Ah, the same Julian who loves mystery shoppers and ‘maintaining the momentum’ of going backwards is made out to be good.

[Beagle]

Not defending him as I thought it was a slightly creative statement too but maybe there's a larger number of signed contracts he's aware of that are conditional on people selling their homes and now the market has picked up we're in for a really good Q4 ? Time will tell. I will allow him a rare indiscretion and keep the faith.

No mater what, one thing I am confident of is that underlying eps will grow quite well this year and into the future.

[winner69]

Not defending him as I thought it was a slightly creative statement too but maybe there's a larger number of signed contracts he's aware of that are conditional on people selling their homes and now the market has picked up we're in for a really good Q4 ? Time will tell. I will allow him a rare indiscretion and keep the faith.

No mater what, one thing I am confident of is that underlying eps will grow quite well this year and into the future.

Yep indeed - especially with all the abnormal revaluations of 2016/2017 to be realised

I reckon F19 Underlying Earnings to be $116m/$120m even if sales are the same as last year.

That’s oretty good compared to $98m in F18

[Beagle]

Plenty good enough for FY19 and in FY20 we can look forward to even more growth driven by both previous IFRS reported gains, higher volumes of resales and a higher build rate. FY21 we start to see Australian development kicking in as well. Long term hold, can't go wrong.

[peat]

Long term hold, can't go wrong.

Put your offer orders in now and beat the queue :p

[Beagle]

Put your offer orders in now and beat the queue :p

LOL I would but for the fact that I'm well positioned already :D

[penn]

It is so obvious that there is no such thing as price manipulation. Those Thirteen buyers wanting a total of 171 shares are all genuine! even if there is one seller of 2225 two pips higher.

[peat]

LOL I would but for the fact that I'm well positioned already :D

you didn't get my dig Beagle. I said offer , not bid. I am implying that your long term hold status will change soon enough

[Beagle]

you didn't get my dig Beagle. I said offer , not bid. I am implying that your long term hold status will change soon enough

LOL yeah I missed it probably because I'm as happy as a pig in mud.:t_up:

[Baa_Baa]

What did I miss this week? SUM gaps up Friday (32c for the week), RYM up, MET! up, even OCA gets some love. Retirement sector back in favour?

[Beagle]

Rotation out of defensive sectors of REIT's and Utilities to growth stocks.

[value_investor]

Sector rotation is probably the answer, a large insto or group of investors probably looked around and saw valuations were out of control in other places but it hasn't really hit in the retirement industry. Current PE of 14.5 and forward PE on a $110m underlying profit would put it at a 15.90.

I'm not sure the retirement sector will really hit the saturation for a few more years yet on the demand side. The biggest sign is the obvious lousy sales numbers across all the companies. OCA still selling units from a retirement village built in a upmarket suburb by the beach 6 months after building it is a case study. Of course the weak sales in SUMs case, inability to ramp sales year after year suggests to me there isn't an insatiable demand for the product, and the pull back of the build rate is another case study.

Until it hits that kind of maturity, I think SUM and related companies will trade in this PE range until eventually becoming stable and surethings on the market as a whole. The early bird obviously gets the worm, and we can all look at what happens when you do get that maturity in how RYM trades compared to the rest, SUM included.

[winner69]

Jeez sector rotation seems a bit like herd mentality ...wonder where they’ll drift off to next.

Or maybe it’s just the gurus finally realising the property market isn’t collapsing after all

[winner69]

Jeff doesn’t live on this thread

[Beagle]

110m / 226.83m shares = FY19 underlying eps of 48.5 cps. $6.86 / 0.485 = FY19 forward PE of 14.1.
Very cheap forward PE for a stock that arguably has the best history of growth in the NZX. Expansion into Australia will start to lift earnings in FY21 and beyond too.
Naysayers predicting a property market collapse have been proven wrong, yet again for the umpteenth time.
Some people simply don't want to understand that the vast majority of SUM's villages are outside the Auckland region and regions have been growing strongly.

[winner69]

110m / 226.83m shares = FY19 underlying eps of 48.5 cps. $6.86 / 0.485 = FY19 forward PE of 14.1.
Very cheap forward PE for a stock that arguably has the best history of growth in the NZX. Expansion into Australia will start to lift earnings in FY21 and beyond too.
Naysayers predicting a property market collapse have been proven wrong, yet again for the umpteenth time.
Some people simply don't want to understand that the vast majority of SUM's villages are outside the Auckland region and regions have been growing strongly.

Earnings going to be more like $120m ....because of what you said about property prices

Julian sure been lucky with how property prices have gone the last few years — might have even saved him his job

[Beagle]

$120m gives 52.9 cps underlying earnings. $6.86 / 0.529 = 2019 PE of 13.
I'm thinking about where underlying earnings will be 4-5 years from now. I see about ~ $1 per share and a share price of ~ $15. Pays to think ahead doesn't it :)
Could me more if they really crank up in Australia.

[winner69]

$120m gives 52.9 cps underlying earnings. $6.86 / 0.529 = 2019 PE of 13.
I'm thinking about where underlying earnings will be 4-5 years from now. I see about ~ $1 per share and a share price of ~ $15. Pays to think ahead doesn't it :)
Could me more if they really crank up in Australia.

That was what I was thinking 7-8 years ago

This sector rotation thing sounds rather silly - were the gurus rotating out at the bottom and now rotating in at a higher price?

[Baa_Baa]

110m / 226.83m shares = FY19 underlying eps of 48.5 cps. $6.86 / 0.485 = FY19 forward PE of 14.1.
Very cheap forward PE for a stock that arguably has the best history of growth in the NZX. Expansion into Australia will start to lift earnings in FY21 and beyond too.
Naysayers predicting a property market collapse have been proven wrong, yet again for the umpteenth time.
Some people simply don't want to understand that the vast majority of SUM's villages are outside the Auckland region and regions have been growing strongly.

Compelling buy even at these price up over $1.50 since June low. Also by far the best EPS:SP ratio of all listed retirement companies. Still well underpriced imho.








EPS


SP


EPS:SP



SUM

$ 0.999


$ 6.86


14.6%



ARV

$ 0.139


$ 1.53


9.1%



OCA

$ 0.074


$ 1.05


7.0%



RYM

$ 0.652


$ 13.59


4.8%



MET

$ 0.184


$ 5.00


3.7%

[percy]

Compelling buy even at these price up over $1.50 since June low. Also by far the best EPS:SP ratio of all listed retirement companies. Still well underpriced imho.








EPS


SP


EPS:SP



SUM

$ 0.999


$ 6.86


14.6%



ARV

$ 0.139


$ 1.53


9.1%



OCA

$ 0.074


$ 1.05


7.0%



RYM

$ 0.652


$ 13.59


4.8%



MET

$ 0.184


$ 5.00


3.7%



Yield investors may see things differently.?
......................Yield.
SUM ...............1.98%
ARV..................3.52%
OCA.................4.48%
RYM.................1.67%
MET..................2.2%

disc.I currently do not hold any retirement sector share.

[Beagle]

That was what I was thinking 7-8 years ago

This sector rotation thing sounds rather silly - were the gurus rotating out at the bottom and now rotating in at a higher price?

Baa Baa - I use underlying earnings, but any way you slice and dice this SUM are a very cheap growth stock.
This time 3 years ago before the Auckland housed price malaise set in the shares were $4.65 and SUM subsequently reported $56.6m in underlying earnings for 25.6 cps. At that time SUM were trading on a forward PE of 18. I would have no difficulty investing on that forward PE today considering their outstanding track record of growth.
If they can make 50 cps underlying this year I think fair value is about $9. I see it quite differently to the market which is why I have a fulsome allocation already.

Percy, Horses for courses mate, I don't think many, if anyone is investing in this sector for dividend yield. Do you invest in PAZ for yield ? I am sure you get my point.

Winner, much talk on CNBC, that channel you don't like about portfolio repositioning. Utilities and REIT's down 4% in the US just in the last week.
If you take MEL, the biggest here, as a classic case in point. At one point they gave a total shareholder return for 2019 of 85%. Obviously investors have really positioned their portfolio's defensively for 2019 up until quite recently. The likelihood of a stock like MEL dramatically outperforming the market in 2020 is something I would rate the possibility of occurring again as extremely slim.

The chances of SUM outperforming are in my opinion very good.

[Baa_Baa]

Yes even on underlying earnings the PE is attractive, on IFRS NPAT even more so at around 7.4 from memory? Agree that this is a growth hold rather than yield play.

[Beagle]

IFRS eps 97.13 cps last year so historic IFRS PE is just 7.1.
Operating cash flow was just on $1 a share last year too.
Westpac economists recently predicting national average house price gains of 7% for 2020.
I think there are solid grounds, (not the least of which is highly likely to be an unbroken track record of 8 years of double digit underlying earnings growth since listing), to be optimistic about the prospects for 2020 and beyond.

Can't help wondering what it might take for the market to finally see this companies growth record for the outstanding success it is ?
Perhaps when they have strung together an unbroken track record of a decade's worth of double digit underlying profit growth results the market will finally accept this as a true growth stock and rerate the PE accordingly ?

[value_investor]

110m / 226.83m shares = FY19 underlying eps of 48.5 cps. $6.86 / 0.485 = FY19 forward PE of 14.1.
Very cheap forward PE for a stock that arguably has the best history of growth in the NZX. Expansion into Australia will start to lift earnings in FY21 and beyond too.
Naysayers predicting a property market collapse have been proven wrong, yet again for the umpteenth time.
Some people simply don't want to understand that the vast majority of SUM's villages are outside the Auckland region and regions have been growing strongly.

Agreed with you on the housing comment. The pricing has held up strongly everywhere, except the sales numbers has not grown at all across the retirement sector in the past two years which is something to keep an eye on. The thesis on the industry as a whole is that there will an avalanche of retirees as time goes on looking at care suites and apartments. It will happen with time but I'm a bit worried that in the meantime we'll see a supply glut that will make it harder for SUM and others to differentiate their product.

In FY18, 454 units delivered and 339 new sales (OCA delivered 272, sold 133 for comparison). Same thing is likely to happen this FY again with new sales tracking slightly lower than last year. Not sure how they reverse that in the short to medium term and I think that the weak sales reflects on the price of the stock because I'm not really sure where gains are going to come from. If you are long on the retirement sector, you will probably do okay, based purely on the numbers.

Just on the short/medium term, building consents on retirement units is currently 17% higher than last year, 1972 units consented in 2018, and 2310 in 2019 and this is just on 9 months data. There's a glut of listings coming on the market. Interesting times ahead.

https://www.stats.govt.nz/information-releases/building-consents-issued-september-2019

[Lease]

Agreed with you on the housing comment. The pricing has held up strongly everywhere, except the sales numbers has not grown at all across the retirement sector in the past two years which is something to keep an eye on. The thesis on the industry as a whole is that there will an avalanche of retirees as time goes on looking at care suites and apartments. It will happen with time but I'm a bit worried that in the meantime we'll see a supply glut that will make it harder for SUM and others to differentiate their product.

In FY18, 454 units delivered and 339 new sales (OCA delivered 272, sold 133 for comparison). Same thing is likely to happen this FY again with new sales tracking slightly lower than last year. Not sure how they reverse that in the short to medium term and I think that the weak sales reflects on the price of the stock because I'm not really sure where gains are going to come from. If you are long on the retirement sector, you will probably do okay, based purely on the numbers.

Just on the short/medium term, building consents on retirement units is currently 17% higher than last year, 1972 units consented in 2018, and 2310 in 2019 and this is just on 9 months data. There's a glut of listings coming on the market. Interesting times ahead.

https://www.stats.govt.nz/information-releases/building-consents-issued-september-2019

This is a capital intensive industry thus small players can't beat big ones like RYM or SUM. The industry is highly related to property cycle. Given the current very low interest rate, and seems no economic recession is imminent, property market should be still strong and it is good news to SUM.

I have worked out SUM CAGR of underlying profit has been at 31% since listing. Portfolio has been rising at double digit every year. Given the current SP at Price/underlying EPS is only 16, the share is really cheap.

[winner69]

SUM doesn’t really need to sell more units at the moment to grow earnings strongly

Like in F19 realised gains per sale likely to be ~20% higher than F18 (and about the same in F20)

Sales stay the same but 20% more realised gains = 20% increase in underlying earnings

All the result of a booming property market over the last few years.

Good eh

[winner69]

This is a capital intensive industry thus small players can't beat big ones like RYM or SUM. The industry is highly related to property cycle. Given the current very low interest rate, and seems no economic recession is imminent, property market should be still strong and it is good news to SUM.

I have worked out SUM CAGR of underlying profit has been at 31% since listing. Portfolio has been rising at double digit every year. Given the current SP at Price/underlying EPS is only 16, the share is really cheap.

Not just cheap .....as you say really cheap ...and probably extremely cheap

[Beagle]

SUM doesn’t really need to sell more units at the moment to grow earnings strongly

Like in F19 realised gains per sale likely to be ~20% higher than F18 (and about the same in F20)

Sales stay the same but 20% more realised gains = 20% increase in underlying earnings

All the result of a booming property market over the last few years.

Good eh

Is good and you are quite right but I would like to see a pick up in the sales rate in 2020 and see the build rate grow to ~ 500 per annum. That's the key to driving this a lot higher.

[macduffy]

Is good and you are quite right but I would like to see a pick up in the sales rate in 2020 and see the build rate grow to ~ 500 per annum. That's the key to driving this a lot higher.

I havn't been able to find any info on the number of vacancies in SUM's portfolio from time to time. Does anyone know how the occupancy rate is tracking over time?

Disc: Holding.

[Maverick]

Julian has said "resales " are the thing to watch as the indicator to the supply / demand balance , not "new sales". These new villages being developed now are so big that the time it takes for them to be "digested " by the area, that would skew the numbers (for the information you are looking for) by including them the un/occupancy rate.
So in their last release (FY18 results presentation pg25) they said un-contracted resale stock is 1.4% (53)which averages 2 per village. This is similar to FY17 despite more houses in the portfolio.
There is also a nice graph on that page too which goes back to FY13 that demonstrates their un-occupancy fluctuates between 1.0% and 1.5% over that time.

[Beagle]

Here's a link to that presentation. See page 25 as Maverick has suggested and I note that resales stock availability has been consistently very low.
http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/SUM/330947/295456.pdf

After a difficult 2019 I expect SUM will be one of my top performing stocks for 2020. Anyone thinking they have missed the boat might like to reflect on the fact that SUM has underperformed the NZX50 by 25% in the last year. I believe its probably the cheapest "proven growth stock" on the NZX by quite SUM margin.10837

[macduffy]

Thanks to both of you.
:)
That 1.4% number reassures!

[couta1]

Here's a link to that presentation. See page 25 as Maverick has suggested and I note that resales stock availability has been consistently very low.
http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/SUM/330947/295456.pdf

After a difficult 2019 I expect SUM will be one of my top performing stocks for 2020. Anyone thinking they have missed the boat might like to reflect on the fact that SUM has underperformed the NZX50 by 25% in the last year. I believe its probably the cheapest "proven growth stock" on the NZX by quite SUM margin.10837 Might be one of the top performing stocks but it will still only be worth half of RYM and that's a long proven fact that no amount of barking has been able to change. Lol

[winner69]

Might be one of the top performing stocks but it will still only be worth half of RYM and that's a long proven fact that no amount of barking has been able to change. Lol

Seems the whole sector will be top performers ...although Oceania probably still around $1.04

[Beagle]

Time will tell Couta1. My actions and investment in SUM says you're going to be wrong in the future. Actions speak louder than words or barking :p

[couta1]

Time will tell Couta1. My actions and investment in SUM says you're going to be wrong in the future. Actions speak louder than words or barking :p Time has already told mate, you will be in a SUM village yourself and still barking the same tune.

[Beagle]

Time has already told mate, you will be in a SUM village yourself and still barking the same tune.

:lol: Touché. Hope you're in the unit next door so I can still drive you crazy with my braking :p

[couta1]

:lol: Touché. Hope you're in the unit next door so I can still drive you crazy with my braking :p Lol I think you meant barking but I reckon your braking would also drive me nuts.

[davflaws]

Lol I think you meant barking but I reckon your braking would also drive me nuts.

Full astern! Everybody down!!

[Joshuatree]

As long as its regenerative braking we could all be out there sooner.:t_up:

[peat]

10838

certainly was a big green candle the other day!!!

[macduffy]

I hate to admit it but the 50% theory is working perfectly at the moment.

RYM $14
SUM $7

:ohmy:

[Beagle]

Its spooky isn't it. I am starting to wonder if Couta1 has been around all the institutions heavily espousing his special theory :lol:
I reckon in 25 years time Coutts and I will be riding around on our electric carts at SUM retirement village, dog's in tow, and he'll still be claiming victory when SUM is half RYM, (except he will have early onset of dementia), and be in complete denial about SUM's 3:1 share split :D

[macduffy]

And both at 12 month highs. (RYM and SUM, that is, not you and Couta!)

[Beagle]

$7+ Good stuff.

[Bobdn]

$7+ Good stuff.

Wow, it's like you're personally moving the market ;)

[winner69]

Wow, it's like you're personally moving the market ;)

No .,,just following RYM up

Like the old saying a rising tide lifts all boats

Good times though :):)

[winner69]

REINZ sales data for October out sometime this week

That’ll show a strong property market ...always help sentiment around retirement sector shares

[winner69]

Its spooky isn't it. I am starting to wonder if Couta1 has been around all the institutions heavily espousing his special theory :lol:
I reckon in 25 years time Coutts and I will be riding around on our electric carts at SUM retirement village, dog's in tow, and he'll still be claiming victory when SUM is half RYM, (except he will have early onset of dementia), and be in complete denial about SUM's 3:1 share split :D

......and you’ll still be swinging to Taylor Swift

[Bobdn]

............................

[Beagle]

Wow, it's like you're personally moving the market ;)

Nah not me mate. I barked loud and long for many months this was good buying mid this year at $5.50 but it stayed there for months.
Sector rotation going on now. REIT's and Utilities have enjoyed a fabulous run and have well and truly had their time in the sun in 2019.
Increasingly market participants are waking up to the fact that growth and value stocks are the most likely sectors to outperform in 2020.
Really helps that SUM is both a value and a growth stock :)

[Bobdn]

No .,,just following RYM up

Like the old saying a rising tide lifts all boats

Good times though :):)

@Winner For sure, rode this all the way up to $7.80 and then rode it all the way down. I'm moving most of my funds to index funds but I'm allowed to keep 8 long term mad money shares for interest. This is one of the 8 I've selected.

[macduffy]

There's nothing "mad money" about SUM!

[Beagle]

......and you’ll still be swinging to Taylor Swift

Rumour has it that Coutts and I have each placed an order for one of these for future retirement village use...have to get my custom stereo fitted too...and we'll have to get greyhound dog's so they can keep up lol
https://www.youtube.com/watch?v=gWYRhaOd1PE

[winner69]

@Winner For sure, rode this all the way up to $7.80 and then rode it all the way down. I'm moving most of my funds to index funds but I'm allowed to keep 8 long term mad money shares for interest. This is one of the 8 I've selected.

Good choice is SUM

[winner69]

SUM share price will be $8 by Xmas

And then when they mention $120m Earnings goodness knows what’ll happen

Remember share price follows earnings

[couta1]

SUM share price will be $8 by Xmas

And then when they mention $120m Earnings goodness knows what’ll happen

Remember share price follows earnings RYM holders will be pretty happy then with $16.

[winner69]

RYM holders will be pretty happy then with $16.

RYM probably have a good half year result next week ....that’ll boost SUM share price.

[Lewylewylewy]

Latest immigration figures out. Keeps going up. Increased demand for housing. Up up up.

[Food4Thought]

Rumour has it that Coutts and I have each placed an order for one of these for future retirement village use...have to get my custom stereo fitted too...and we'll have to get greyhound dog's so they can keep up lol


https://www.youtube.com/watch?v=gWYRhaOd1PE

Vroom ... vroom. What a slick machine. I'll have a couple. Need a spare for when it over heats...

What a end of year...

Wonder if these retirement operators are investing in analytics. (PLX jumps on board with SUM?)

Popular places around their sites... good spots to recharge their electric exhilaration machines and juice their pace makers.

I'd say install an AED ...with it connected right up to the person and ready to go for when it may be needed.

Happy Tuesday 🙌

[Beagle]

Real estate going gangbusters in the regions and doing okay in Auckland too https://www.reinz.co.nz/Media/Default/Statistic%20Documents/2019/Residential/October/REINZ%20Monthly%20Property%20Report%20-%20October%202019.pdf
SUM very well positioned with the widespread geographical locations of their villages. Hawkes Bay for instance up nearly 17% and Nelson up 11%.
National Medium up a whopping 8.2%.
No wonder RBNZ stayed on hold yesterday...(probably had early access to these very strong statistics)
BUY

[winner69]

Our Chairman got honoured at his old university last night. In Accepting his honour Rob said: “Diversity is not an aspiration, it is a fact, and we choose whether we recognise and live it. We need to keep a focus on fairness, outcomes, and sacrifice so the rest of the world can progress along with us.”

We said Rob

[Baa_Baa]

SUM share price will be $8 by Xmas

And then when they mention $120m Earnings goodness knows what’ll happen

Remember share price follows earnings

Another big build getting underway in the 'Naki' https://www.stuff.co.nz/taranaki-daily-news/news/117413530/work-on-150-million-retirement-village-in-new-plymouth-to-begin-this-month

[Beagle]

Another big build getting underway in the 'Naki' https://www.stuff.co.nz/taranaki-daily-news/news/117413530/work-on-150-million-retirement-village-in-new-plymouth-to-begin-this-month

Good stuff. Regional housing prices are going gangbusters.

[winner69]

Good stuff. Regional housing prices are going gangbusters.

...and going gangbusters more as every month passes

House prices in NZ since 1990 seems to have increased heaps more than most countries as the chart from The Economist shows

Home owners may feel richer but we are probably much, much poorer as a society and an economy.

But as long as we have the likes of SUM to ‘invest’ in does all that matter

[Beagle]

Interesting, thansk fro sharing.
Do you like Italian food Winner ? Looks pretty cheap to retire there :)

[kiwico]

House prices in NZ since 1990 seems to have increased heaps more than most countries as the chart from The Economist shows

But of course another aspect of this is currency and rates of exchange over a period of time which this ignores. Not so long ago $1 bought not much more than 25p but has been double that for much of the tying-to-get Brexit period - such a change would have a very telling effect on this making houses more expensive in other currencies but not necessarily NZD. Arguably it means the NZD is still too strong.

[winner69]

But of course another aspect of this is currency and rates of exchange over a period of time which this ignores. Not so long ago $1 bought not much more than 25p but has been double that for much of the tying-to-get Brexit period - such a change would have a very telling effect on this making houses more expensive in other currencies but not necessarily NZD. Arguably it means the NZD is still too strong.

Chart shows real house priced indexed to 1990

Thus only shows how much house prices have risen since then ....not the average value of houses

All it’s showing that NZ property prices have risen faster than the other countries shown, not the relative value

[value_investor]

I see underlying profit of about $110m during the end of year report. Interested to see how high this one goes but its still a decent buy relative to what you can get in the market.

[winner69]

I see underlying profit of about $110m during the end of year report. Interested to see how high this one goes but its still a decent buy relative to what you can get in the market.

C’mon value - don’t be so pessimistic - $100m isn’t that much more than last year

Have you forgotten to allow for extraordinary revaluation gains of 2016/2017 which are only just beginning to get realised (ie go into Underlying Earnings)

At least $120m by my workings

[Beagle]

I'm right into looking at how the various business model's in this sector have performed over the last 5 years because I believe that gives a genuine feel for how successful the relative business models of each company are.
In the MET thread I observed that they had grown underlying earnings 97% in 5 years and RYM 92%.
100% in 5 years is often referred to as a benchmark as this exactly equals 15% per annum growth compounded over 5 years, i.e. 1.15 x 1.15 x 1.15 x1.15 x1.15 = 2.01 or 101% growth.

So which model works best ?
In 2014 SUM's underlying profit was $24.4m and if they do $120m this year that's 4.91 times their 2014 result a 391% increase. Just "a little" more than MET or RYM :) I think 391% growth speaks for itself which is why this remains my top hold in this sector.
I expect the share price to test all time high's in early 2020.

[winner69]

If speculation is true and SUM acquire Metlifecare what do punters think will happen to the SUM share price.

[dreamcatcher]

If speculation is true and SUM acquire Metlifecare what do punters think will happen to the SUM share price.

OK w69 I will take the bait........... SP probably goes down

[Baa_Baa]

If speculation is true and SUM acquire Metlifecare what do punters think will happen to the SUM share price.

Depends on what they have to do to raise the purchase $ and resulting EPS. If combined EPS is accretive SP goes up, if not it goes down while SUM swallows the debt/equity raise. Too early to speculate imho, SUM might not be the buyer.

[Beagle]

If speculation is true and SUM acquire Metlifecare what do punters think will happen to the SUM share price.

I'm backing management to extract quite substantial synergies from any transaction and I expect the deal to be eps accretive next year. Onward and upward to fresh all time high's in 2020, in my opinion.

[winner69]

I'm backing management to extract quite substantial synergies from any transaction and I expect the deal to be eps accretive next year. Onward and upward to fresh all time high's in 2020, in my opinion.

Of course it will be not be eps accretive .....it will be highly eps accretive ...always is eh but sounds good

I’ve emailed Julian as well

Just need the NBR and the AFR to run a story saying it’s Summerset and Julian will come clean and make a ‘disclosure’

[winner69]

If SUM are acquiring Metlifecare is this Rob’s really big play ....something he will be remembered for

[Beagle]

SUM other good disclosures from SUM this morning on ST John's approval and more land in Christchurch. Didn't hear back from Julian and can't say I am surprised lol
Don't think Rob is driving this....Julian a very motivated man who never forgets, (unlike many other CEO's), his main role is to create shareholder value.

[Baa_Baa]

The less we say about SUM, the better it gets, cranking out the properties and the profits. So glad I ignored the property market worries and accumulated a decent (for me) position into price weakness which is now my best returning holding. Things look bright for the long term with such a good beginning.

[Baa_Baa]

'Summerset on the Landing' has its first residents, obvious signs in some units ... people, curtains, furniture, lights on, TV aerials. Amazing how quickly this place has gone from a dirt pile to brand new homes. Will be interesting to hear about the sales uptake in due course. The big building I presume is a communal living and higher needs facility. What I hadn't realised is that this village is alongside a very large brand new residential subdivision currently under development.

1087210873108741087510876
Well done Summerset, doing as they said, occupancy underway by EOY. Done, tick.

[Beagle]

Thanks for sharing Baa Baa.
I'm expecting SUM to test all time high's early in 2020 or possibly even this month. After the share price recovery in recent months, (and based on what I believe is a conservative forecast of $110m underlying profit), that equates to 48.5 cents per share so at $7.70 we're now on a forward underlying PE of 15.9, for a year that's almost over, which is still pretty low for the rate of growth this company has experienced over the years. I'm now thinking about underlying profit for FY20 or more especially FY21 and beyond earnings as they ramp up their Australian expansion.
Very good long term hold, (regardless of whether its them taking over / merging with MET or not).

[winner69]

All time high is $8.00

Surely a new all time high before Xmas .....and before 2020 of course

Unless SUM come out and saying they MET ...that’ll hit the share price a bit

[kiwico]

'Summerset on the Landing' has its first residents, obvious signs in some units ... people, curtains, furniture, lights on, TV aerials. Amazing how quickly this place has gone from a dirt pile to brand new homes. Will be interesting to hear about the sales uptake in due course. The big building I presume is a communal living and higher needs facility. What I hadn't realised is that this village is alongside a very large brand new residential subdivision currently under development.

You've better eyesight than me, I've booking for life each time I drive by but still hadn't seen any (although it looks like you've driven up the road by the new roundabout). I agree it really has shot up at a rapid rate.

[Baa_Baa]

You've better eyesight than me, I've booking for life each time I drive by but still hadn't seen any (although it looks like you've driven up the road by the new roundabout). I agree it really has shot up at a rapid rate.

Yes, the road was open and you could drive past Summerset and around the whole new subdivision next to it. Definitely occupation, as per my previous message.

Honestly, Summerset seem so efficient putting up these independent living houses, it’s (amazing) and a wonder the Minister of housing hasn’t asked them to take over Kiwi Build.

[winner69]

Couts me old mate ...did you see SUM share price is exactly 50% of RYM share price

That in spite of a lot of excitement around SUM and a not so brilliant half year result from Ryman

But relatively rules eh ..no matter what

[Beagle]

Couts me old mate ...did you see SUM share price is exactly 50% of RYM share price

That in spite of a lot of excitement around SUM and a not so brilliant half year result from Ryman

But relatively rules eh ..no matter what

:lol: Classic dog bait :lol:

[couta1]

Couts me old mate ...did you see SUM share price is exactly 50% of RYM share price

That in spite of a lot of excitement around SUM and a not so brilliant half year result from Ryman

But relatively rules eh ..no matter what The punters cant be fooled aye winner.

[winner69]

The punters cant be fooled aye winner.

As they often say the market is indeed a weighing machine and the scales will always need 2 SUMs to weigh the same of 1 RYM

And one could say that the market has also voted this to be true

[King1212]

Total assets of NZ$3.0 billion, up 24% on 1H18

Current cap is only 1.7b...so plenty to go IMO. No brainier one for long term....

[mfd]

Total assets of NZ$3.0 billion, up 24% on 1H18

Current cap is only 1.7b...so plenty to go IMO. No brainier one for long term....

There's about 2 billion in liabilities too unfortunately, 1.2 billion in residents loans, half a billion in borrowings and a few other bits and pieces. Net tangible assets of 4.71 dollars per share according to nzx.

[Beagle]

https://www.news.com.au/finance/business/breaking-news/property-prices-race-higher-in-november/news-story/5aa22ee39f0119b3730eeb60b1687994?utm_source=ST&utm_medium=email&utm_campaign=ShareTrader+AM+Update+for+Tuesday+3+D ecember+2019

Looks like SUM timed their recent entry into the Melbourne market perfectly !

[winner69]

https://www.news.com.au/finance/business/breaking-news/property-prices-race-higher-in-november/news-story/5aa22ee39f0119b3730eeb60b1687994?utm_source=ST&utm_medium=email&utm_campaign=ShareTrader+AM+Update+for+Tuesday+3+D ecember+2019

Looks like SUM timed their recent entry into the Melbourne market perfectly !

Did you really mean to link the story about how to get a beagle to instantly stop barking and listen

[Beagle]

Did you really mean to link the story about how to get a beagle to instantly stop barking and listen

LOL probably not, where did I post that link ?

[peat]

Did you really mean to link the story about how to get a beagle to instantly stop barking and listen

funny :p:t_up:

[winner69]

LOL probably not, where did I post that link ?

It was under that story about Aussie property .....it was so eye catching I didn’t even read about property prices

[Beagle]

It was under that story about Aussie property .....it was so eye catching I didn’t even read about property prices

I doubt that device would work :lol:

[percy]

https://www.stuff.co.nz › business › philip-burdon-and-family-sell-the-prebb.

Fantastic,my first copy and paste.Taken years.!!..lol.
Christchurch City Library "Beyond beginners" course taught me something.!
Blast did not work,and the course has finished.
So back to Google: Richlister sell Canterbury mushroom factory site to retirement..

[Joshuatree]

Congrats, easy, ehh :) heres the active link, one click.

Richlister sells Canterbury mushroom factory site ... - Stuff.co.nzhttps://www.stuff.co.nz › business › philip-burdon-and-family-sell-the-prebb... (https://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=1&ved=2ahUKEwiykcm-vJrmAhUab30KHUIuCKUQFjAAegQIAhAB&url=https%3A%2F%2Fwww.stuff.co.nz%2Fbusiness%2F117 739405%2Fphilip-burdon-and-family-sell-the-prebbleton-mushroom-factory-site-to-retirement-village-developers-summerset&usg=AOvVaw3uCjANljKJVoFWQkyGsXj4)

[dobby41]

https://www.stuff.co.nz › business › philip-burdon-and-family-sell-the-prebb.

Fantastic,my first copy and paste.Taken years.!!..lol.
Christchurch City Library "Beyond beginners" course taught me something.!
Blast did not work,and the course has finished.
So back to Google: Richlister sell Canterbury mushroom factory site to retirement..

https://www.stuff.co.nz/business/117739405/philip-burdon-and-family-sell-the-prebbleton-mushroom-factory-site-to-retirement-village-developers-summerset

[Beagle]

https://www.stuff.co.nz › business › philip-burdon-and-family-sell-the-prebb.

Fantastic,my first copy and paste.Taken years.!!..lol.
Christchurch City Library "Beyond beginners" course taught me something.!
Blast did not work,and the course has finished.
So back to Google: Richlister sell Canterbury mushroom factory site to retirement..

All the proof you need that you can teach an old dog new tricks :cool:

[Joshuatree]

Spot the difference. This percy pig "is about the size of a very thick beagle" at the 2 min 02 second mark , below.:t_up:.


PreviewPreview3:26Watch This 135 Pound Dog Fall in Love with a Tiny Piglet ... (https://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=2&ved=2ahUKEwjh_amFw5rmAhUNXSsKHdjnA2oQwqsBMAF6BAgLE Ac&url=https%3A%2F%2Fwww.youtube.com%2Fwatch%3Fv%3DMj dVLe8_Hbk&usg=AOvVaw1bFhKs05OK67EURglWFWYF)

[Beagle]

Spot the difference. This percy pig "is about the size of a very thick beagle" at the 2 min 02 second mark , below.:t_up:.


PreviewPreview3:26Watch This 135 Pound Dog Fall in Love with a Tiny Piglet ... (https://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=2&ved=2ahUKEwjh_amFw5rmAhUNXSsKHdjnA2oQwqsBMAF6BAgLE Ac&url=https%3A%2F%2Fwww.youtube.com%2Fwatch%3Fv%3DMj dVLe8_Hbk&usg=AOvVaw1bFhKs05OK67EURglWFWYF)

LOL Not true. We got Kelly the Beagle when she was 2 and already 23 kg's (50 pounds) ! Now that's a thick Beagle !..and she was so solid we wondered if she had a bit of Labrador in her... Never had any joy trying to get her to lose weight because Beagle's LOVE their food...just like a certain hound on here loves his dividends, hence the expression dividend hound :)

[winner69]

Watch the races from Trentham at the moment - always good to see that big Summerset village next to the track

It amazes me it hasn’t sunk into the bog that Trentham is during winter

Hope residents having a lucky day at the races

[winner69]

For what it’s worth Summerset at the Course has only a 3.9 rating from Google reviews

One of the low scoring ones is this one — the reason why I’m a shareholder- even though I sometimes it not good to make money out of the elderly. :( :cool::t_up:



Set up to make money, not friends. Is a business not a service & profit for shareholders is king, with residents just a way to make $$$$$ Not for nothing is Summerset the most profitable retirement village in NZ! Is good while you are still independent & mobile with a vehicle but as your mobility declines you realise how little they care & how poorly designed the complex is.

[Beagle]

To be fair you are always going to get a variety of opinion. I note the closest village to me, Monterey on the park at Hobsonville has a 4.5 star rating on google, (32 reviews).
Anecdotally people seemed very satisfied when I visited there a while back and with the superb waterfront views and modern facilities why wouldn't they be...

At the end of the day it is a business and Julian Cook sets the tone of the culture in that regard very well in my opinion. I know some people think he's very tough when it comes to cost control but to be frank, I really like that as a shareholder, its not a charity.

[winner69]

NZ housing market on fire

Record prices all around all over the place ....and huge increase in Auckland volumes


All good for SUM (and the others except maybe Oceania) future earnings

Go you good things

https://www.reinz.co.nz/Media/Default/Statistic%20Documents/2019/Residential/November/REINZ%20Monthly%20Property%20Report%20-%20November%202019.pdf

[Maverick]

All good for SUM (and the others except maybe Oceania)

QUOTE]
loving your sense of humour Winner. Merry Christmas to you too.

[winner69]

All good for SUM (and the others except maybe Oceania)

QUOTE]
loving your sense of humour Winner. Merry Christmas to you too.

Merry Christmas to you as well Maverick

I still have some Oceania shares - biggest mistake I’ve made for years and a huge disappointment

Who would have thought they could sell heaps more units and not grow earnings

Hope reigns eternal ...maybe will be a happy new year.

[Beagle]

NZ housing market on fire

Record prices all around all over the place ....and huge increase in Auckland volumes


All good for SUM (and the others except maybe Oceania) future earnings

Go you good things

https://www.reinz.co.nz/Media/Default/Statistic%20Documents/2019/Residential/November/REINZ%20Monthly%20Property%20Report%20-%20November%202019.pdf

Very encouraging. MET still trading at a discount of about 20% to current estimated NTA as at 31 December of $7.25. Lowest premium in the sector other than this unwarranted discount is OCA at a 10% premium to NTA. I thbink its clear the discount is no longer warranted, with or without the potential for coproate activity.

Very difficult to imagine how one can go wrong buying MET at a 20% discount to NTA, taking a medium term view, (acknowledge if the deal doesn't happen we could see a temporary dip back to the low $5's).

SUM will be doing exceptionally well from the major lift in regional medium prices and do even better when the merger proceeds with MET and they can extract huge synergies.

[dabsman]

SUM will be doing exceptionally well from the major lift in regional medium prices and do even better when the merger proceeds with MET and they can extract huge synergies.

You are speaking like you know something?

[Beagle]

You are speaking like you know something?

Acknowledge my opinion is speculative. Should really have put "if" a merger proceeds.

[winner69]

Just a thought

Maybe Summerset have looked at the huge success (share price wise) Arvida has been this year ....,...

........and decided growth by acquisition is the way to go


After there are ‘rumours’ Summerset might be interested in MetLife

[Beagle]

I'd wager Summerset is one of the other two interested parties in MET.
A 1:1 share bid wouldn't surprise me. Underlying eps is almost exactly the same and Julian and team could extract significant synergies and more importantly change the culture and get MET's assets pumping.

[winner69]

SUM closed week at $8.00 - that’s good

Wonder what RYM closed at?