MFT - Mainfreight. Global Freight & Logistics

[Bob Marley]

Hey mon, there doesn't appear to be any talk of MFT lately mon so I'll kick it off here. To me, MFT appears to be have good fundamentals.
1. They pay a regular dividend of 6.5cps or about 3.5% net.
2. Excluding OWN's, MFT returned $12m npat. This equates to a PE of around 15 ($1.88 shareprice / 0.125 eps). MFT have now sold OWN's non-core loss making assets and OWN should now contribute to npat.
3. Prior to aquiring OWN, MFT's share price in July 03 was about $1.30 and OWN's was about $0.95. Now MFT has 90% of OWN (without any need for an issue of additional shares) and MFT's share price is around $1.88. My basic maths tells me $1.30 + 90% x $0.95 = $2.15 > $1.88.

Does anyone have any other views on MFT's fundamentals mon?

Disc: Hold MFT mon

[Daniel B]

Hmmm, interesting way of looking at what the price should be.

Could it not be that the share price of MFT should remain the same because before they have a cash assest and now they have 90% of OWN as an asset?

Or something to that effect...

Daniel B

[Bob Marley]

Probably Daniel mon. I just thought that MFT were funding their acquisition by a combination of selling off some OWN assets plus their ongoing profits mon.

[JAMP]

Judging by the journalistic coverage (http://www.stuff.co.nz/stuff/0,2106,2986568a13,00.html) of the Owens Group annual meeting, there remains a lot of water to flow under the bridge before Mainfreight and Toll Holdings can look to begin the healing process. What options going forward exist for resolution I wonder?

Fisher Funds Management Ltd obviously believe that MFT represent value.

Regards JAMP
NZX: MCH MFT RBD SAN SKX SPN VTX WRI
Unlisted: KCE SUB

[Snow Leopard]

250,000 shares have changed hands at $2 each off market
Anybody any ideas who is buying and selling?

Disc: Own some

[Snow Leopard]

2,418,000 shares have moved at $2 a pop this morning.

This is the largest by far of a number of transaction in the last week or so.

Someone likes them :)

Quartly results also out, plenty of revenue and a little profit

Disc: Holder

[Morpheus]

MFT appears to be in another downtrend. I'm no chart expert but as far as I can tell the price has breached the recent support of around $1.95.
Looking further back, the dips this year don't appear very significant, ie a 15c fall in Feb, 20 cent in May and 10c in July.
Today's price of $1.88 shows a 20c drop from the high of $2.08 recorded in September.
Thus, judging by the general trend this year, MFT would appear to be good buying right now.
What do others think?
Morpheus

[limegreen]

MFT certainly appears to have breached recent support. It has been trading in a fairly restricted range (rectangular) bounded by about 1.95 and 2.06 for the last 3 months (single its first quarter report). The half year result is due around the 17th of November, so it may drift sideways a bit more before then. I'm aware of at least one broker being bullish about it, and I'm quite happy to hold.

[Phaedrus]

Here is what I see when I look at MFT. I have marked nothing at all on the chart so as not to influence anyone. What do you think?

[u]Short-term </u>:- In a downtrend, after a Double Top (Bearish) SELL.

[u]Medium-term </u>:- Just ending an uptrend. SELL.

[u]Long-term </u>:- At the upper margin of a large and ongoing Trading Range. SELL.

What we have here is a superb medium-term trading stock. Fullstop!

http://home.ripway.com/2004-7/148483/MFT001.gif

[Morpheus]

Like I said, I'm no chart expert!!
Thanks Phaedrus :)

[limegreen]

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

Thanks indeed Phaedrus. I am wondering if I have been taking too shorter term view. MFT has clearly broken the uptrend in which it has been for the last twelve months, and could also be viewed as having traded in a rectangle (which I believe is bearish). It is also interesting to note that the resistance at 1.95 once broken became a level of support that it has just broken back through. (Apologies for my chart being a few days old).

Obviously, from a TA perspective, and from the longer term chart you posted it seems entirely reasonable that it may fall back. It would be interesting to hear from a fundamental perspective as to whether there is upside possibility (given that at least one broker sees possibilities in it).

[Phaedrus]

Limegreen,
Here is a larger scale chart covering the period you were commenting on. It includes todays Close of $1.88 in magenta.
Technically, MFT is behaving itself very well, as this chart illustrates. You can see broken Resistance becoming Support (right to the cent) You can see the bearish Double Top (right to the cent). You can see steep fall, once previous Support was broken.
A classical scenario now would be a price increase leading to a failed re-test of the $1.96 Support/Resistance level making a bearish Head and Shoulders pattern. But we won't talk about that.

People that take brokers advice deserve all they get! Or not. There may well be some fundamental evidence that MFT has upside potential. Perhaps the market is unaware of it or doesn't believe it. This stock is clearly being sold down at the moment.

http://img.photobucket.com/albums/v418/789456/MFT2001.gif
PS - Don't forget to trim your charts so that they don't force the entire thread to run offscreen. (Being smaller, they also load quicker - not everyone has broadband!)

[limegreen]

Thanks Phaedrus. I have had a little trouble easily resizing my charts so they are still legible (they're primarily for my own benefit rather than posting here, and to make them narrower would require that I start from the beginning of the process, so I do apologize, but er, I'm a little lazy).


quote:A classical scenario now would be a price increase leading to a failed re-test of the $1.96 Support/Resistance level

I wouldn't be so sad at that. MFT's breakout occurred while I was on holiday. I wouldn't say that I take broker's advice, but it is another barometer I monitor if you will.

Cheers.

[Snow Leopard]

Why has Mainfreights share price taken a dive? Well obviously I do not actually know, however....

This is not a particularly heavily traded ON MARKET share these days and there has often been a several cents discrepency between buy and sell and not much in the way of depth, such that the price has bounced around in the $2.00 mark since the beginning of August. There has been quite a bit of off-market trading with institutions buying and selling in the background.

There has been an almost total lack of news except for the first quarter announcement which to be honest was a bit disappointing but did not seem to disturb the slumbers. The first half year has just finished and I guess it is possible that some knows/suspects that this was not to flash either, the formal announcement is probably several weeks away yet. A number of people are probably a bit jittery due to high fuel costs and the percieved effect that this has on a "trucking" company. [Don't suggest to Don Braid that he runs a trucking company he will explain that this is not so, it is a logistics company :)]
Then again this all started with a single trade that took the price down to 1.95 on Friday (and in which I acquired the last of the shares I was after at $1.98 :(). Possibly this just spooked a few people into selling out as well.

Long term I think that MFT is a company doing the right things and that the share price will recover. The are a company who move stuff around for other companies and they will be affected by oil prices to the degree that their customers are. They are sorting out their Owens purchase and getting their Ozzie ops on the straight and narrow, they have plans in progress to expand their business and are enlarging their presence overseas in SE Asia and America.

I am sticking with them as a long term bet for the moment. And if I had not spent up recently I would go and buy some more. [^]

[stephen]

PT: how do you see MFT standing up to Toll in the long run? I ask because I have ASX.TOL instead... share the same worries about fuel prices etc but I feel happy that Toll is benefiting from network effects and scale.

[limegreen]

I've noted that MFT is a very thinly traded share, so it's thus going to be quite volatile (rather like VTX, another one that periodically gives me the creeps as it bounces). There is a very very short queue of buyers at the moment (3) wanting only about a day's turnover of shares, so it may plunge again if there are willing sellers.

On a slightly unrelated note, Phaedrus, if you're reading this, I posted a chart (oversize) on the SKX thread, and as an amateur, would be interested in a critique.
http://www.sharetrader.co.nz/topic.asp?TOPIC_ID=20094

cheers.

[Snow Leopard]

quote:Originally posted by stephen

PT: how do you see MFT standing up to Toll in the long run? I ask because I have ASX.TOL instead... share the same worries about fuel prices etc but I feel happy that Toll is benefiting from network effects and scale.


Toll will provide spirited competition in New Zealand for anybody in those parts of the shifting business in which they compete. Remember that Mainfreights business is end to end logistics of domestic/international Less Than Container Load Consignments.

They are not the only competition for Mainfreight. However the management of Mainfreight know what they are doing, have a plan, but are flexible enough to cope with changed circumstances.
There is almost certainly room for consolidation in the industry and in time I think that the big will get bigger.

[Copyright 2004 Paper Tiger Deluded Ramblings UnInc ;)]

[rmbbrave]

Mainfreight will replace Powerco in the NZX 50. What effect will this have on the SP?

I bought into Ryman just before it joined the NZX 50 and it has nearly doubled in price.

Does anyone know if institutions HAVE TO buy shares in the NZX 50 or do they TEND TO buy shares in the NZX 50?

[Snow Leopard]

Passive funds that track/invest in the relevent indices will have to buy MFT. Otherwise institutions buy depending upon their belief in the stock.

I don't think the share price will double in the next year, I guess it will rise iover the coming couple of weeks whilst the funds buy in. Longer term it may now become more heavily traded.

Disc: Own MFT

[Snow Leopard]

Today is the day that Mainfreight joins the NZX50, I believe.

It must also be getting close to the half year results announcement.

Last chance to buy before the SP goes to new heights. [:p]

Hopefully :)

Maybe [?]

[limegreen]

Will be interesting to observe the effect of the passive funds, as MFT is a relatively thinly traded stock for one about to join the NZX50. *fingers crossed*

[Snow Leopard]

Ends the day at 210 with an off market trade at 209.

Nice :D

[Snow Leopard]

18/11/2004
1:46 pm

HALFYR: MFT: Mainfreight Half Year Announcement

MAINFREIGHT LIMITED GROUP

FINANCIAL RESULT FOR THE SIX MONTHS ENDED SEPTEMBER 2004
(UNAUDITED)

Net profit within the Mainfreight Group of companies for the first six months
of the 2005 financial year, excluding the Owens acquisition, has improved to
$6.559 million, an increase of 78.6%.

When consolidating the Owens result, net profit declined to $1.145 million.
This decline saw acquisition costs of $2.035 million and Owens Group losses
of $3.378 million for the half year.

Revenues improved, excluding acquisitions and foreign exchange adjustments to
$290.895 million, an increase of 13.9%. All revenues increased to $431.128
million, up from $245.145 million in the previous year's corresponding
period.

The Owens result included after tax abnormal costs to Mainfreight of $1.983
million. While trading losses and costs from Group Services were incurred in
the first half, second half trading is expected to improve significantly as
business performance and trading conditions improve. Further abnormals are
likely as Owens position itself for the long term.

Trading across the balance of the Mainfreight Group is very strong through
the third quarter and results are expected to further improve throughout the
second half.

New, improved, banking arrangements have been confirmed to cater for the
Owens acquisition.

Cashflows for the Group were impacted by the Owens Group requirements.
Excluding Owens, operating cash flows remained positive. Business
improvement and the divestment process being completed will see cash flows
return to normal expected levels.

Divisional Commentary

New Zealand Domestic
Performance remains strong in our most profitable division with EBIT
improving 7.4% to $8.985 million. Revenues are increased 10.5% to $96.686
million. Third quarter trading is very strong as market growth continues.

New Zealand International
Strong performance from Mainfreight International is overshadowed by the
continuing unsatisfactory performance of Lep International. While improving
as the third quarter commences, year end results are likely to be affected
accordingly.

Australian Domestic
Strong revenue growth of 41.4% to $35.355 million sees EBIT recover from a
loss of $3.251 million to a loss of $1.501 million, an improvement of 53.8%.
This trend continues as third quarter trading further improves our position.
Quality warehousing and distribution services are retaining and growing the
customer base with opportunity growth being the highest we have experienced.

Australian International
Improvement continues for both operations with revenue growth improving 18.7%
excluding acquisitions and foreign exchange. EBIT growth continues up 40.2%
to $2.185 million. A particularly good performance from Lep International
has assisted. Third quarter trading remains very positive.

USA and Asia
Both operations are trading well with CaroTrans in the USA improving EBIT
contributions by 395%. Port disruption and congestion in the USA may have
some effect on this growth during the second half, however it is anticipated
that EBIT returns will remain well ahead of the year previous. Trading
between all of the International operations is far ahead of any previous year
and continues to lay a good foundation for further profitable growth long
term.

Owens Group
Significant restructure and divestment has occurred since the majority
shareholding was acquired in November 2003. During this period significant
change has taken place including divestments and a more defined strategic
direction focusing on international and domestic freight forwarding
complimenting the operations of the Mainfreight Group.

Abnormal costs have been incurred with Group losses amounting to $3.378
million to the half year.

As divested businesses are exited a focus has been taken to ensure long term
profitability. The New Zealand domestic operations are seeing improved sales
and margins as the third

[Snow Leopard]

3cps per share dividend announced later yesterday. :)

[Snow Leopard]

Paper Tiger talks to himself some more, would anybody else care to contribute to this thread?

After rising to 210 on reaching the NZ50 a couple of weeks ago this badly overlooked little gem of a share sauntered down to the $2 mark. However the half year result has been well received by the market and nipped back up again. Today, which admittedly is a market up day sees the price rising to 213.
It is my firm belief, obviously, that this is a SP on the rise.

[duncan macgregor]

You sound slightly MIFT at the response tigerish one. When a share saunters down macdunk gallops off much better find a share on a steep trend.
macdunk

[Snow Leopard]

quote:Originally posted by duncan macgregor

You sound slightly MIFT at the response tigerish one. When a share saunters down macdunk gallops off much better find a share on a steep trend.
macdunk


Very Droll :D

With a long term hold one must weather the peaks and troughs of gathering a fortune, firm in the belief that you will be richer for it. [:p]
With a nice little speculative stock then when the tide turns this tiger can run like a leopard. ;)
I much prefer my SP downs to be a saunter to the steep dive you claim to like my friend :)

[Bob Marley]

I will talk with you Paper Tiger mon.

I'm also a long term holder of MFT with no immediate intention of selling.

On the plus side I see mon:
Nice reliable dividends 6.5cps pa.
Recent 6 monthly profit up 79% (excluding Owens).
Just broke through resisitence at around $2.06 and now at all time high.
Institutional interest (Fisher Funds, Brook)
In NZX50 and reasonable liquidity.

On the down side mon:
Owens making losses and taking longer to make profitable
Toll lerking around

[scamper]

Hi there, papery tig!
Scamper is a long-term holder of these, entry at 106, so the div is ok, but the div at current entry levels aint much.
I like this company as a good kiwi people-and-community oriented outfit. works hard to promote from within, big backer of BooksInHomes, etc.
Thanks for your comments, keep them coming.
cheers, scamper.

[limegreen]

It might not be a steep enough trend for Macdunk, but it does, however, seem to be in a trend (actually slightly clearer on a log scale, but I can't paste that due to technical issues). Perhaps Macdunk just didn't notice it when it was still cheap....

MFT did recently get very close to it's 200 day SMA, but on a log scale, it would have to breach 180 to end the uptrend. The two red lines reflect resistance levels. The line at 1.95 was MFT's previous all-time high in 1997, so MFT has broken out of it's long term trading range, and more recently is showing (hopefully) signs of braking the resistance at around 2.05 of recent times. Apologies for the uselessness of the Volume chart.

http://img.photobucket.com/albums/v361/limegreenz/mftnov23.gif

Disc: MFT

[Snow Leopard]

Thank you, it is nice to know I am not alone. [:0]

Owens has been the real fly in the ointment for Mainfreight, they turned out to be a bigger mess than expected. I think they had to sell off more of the Owens bits than was originally intended, but they did not fit and it saved needing to ask us for more money.
However, the right things are happening, which unfortunately takes time.
I admit the divvy is not epic, but it is the equivalent of 4.55% gross at 213 a share, and this is a growth stock remember.

[madmike]

quote:Originally posted by Paper Tiger

Thank you, it is nice to know I am not alone. [:0]

Owens has been the real fly in the ointment for Mainfreight,

I dont think it is owens which is the fly in the ointment but TOLL.
If mft could have got all of owens then it was a very good move for mft, but with toll on the scene doing the "ultimate" merging of mft and owens businesses now becomes quite hard. i personally think that the govt should have stepped in and stopped toll purchasing such a stake.
basically they did it because:
1) mft was one of the main drivers to take the monopoly of the movement of longhaul freight off rail
2) mft was also one of the main drivers to take the monopoly of the unpacking of LCL container freight off the ports
Toll knows that mft is a "go-ahead" company and its stake in owens is purely a blocking stake. they wont contribute anything to owens. this tatic is ok is there is healthy competition in the market but there is not...just like the airlines the power supply etc etc in this country.
The other millstone around mft's neck is its aust operations.its been trying there for 12-13 years (hey maybe whs is using mft's theory re aust ..."try,try.try,try...etc,etc,etc)
I've never owned mft but have considered it right from the ipo...aust has always been the reason why i haven't invested.

those are my thoughts from sitting on the sideline

[rmbbrave]

I have been very happy with MFT.

I bought in at 1.41 in June 2002 again at 1.41 in Oct 2003 and finally at 1.95 in Oct 2004.

I think the recent price rise may have something to do with MFT just entering the NZX50. So some instutions have had to start buying it. This may continue for a while longer. Surely FONZ which promises to hold no more than 5% of any one stock will have to buy some MFT.

[Snow Leopard]

rmbbrave:
The current share price has to do with the confidence people have of a reasonable end of year result. I do not know whether all the index funds have bought up yet, thinking about it, it is possible that the funds review their waitings end of month or some other future date, volumes have been lower than I would have expected. So we may see further rises in the near term while supply and demand do their ballet, but longer term the SP is about the future prospects of this company.

madmike:
I do not want the government stepping in on commercial transactions as a rule, including in this case. I am happy for them to have a strong regulatory role in strategic and monopoly industries. Also I was glad that they saved Air New Zealand.
It would be easier for Mainfreight if Toll did not have a stake in Owens, but they have effective control. The decisions and the costs remain the same, unfortunately Toll reap some of the benefit.
If Toll were offering a level of service meeting Mainfreights requirements at a reasonable cost Mainfreight would happily let Toll shift containers round the country for them.

Toll is aggressive, but so is Mainfreight. Hopefully the shareholders and the country will benefit.

[Snow Leopard]

215 +2 Buy 215 Sell 219 [^]

[Snow Leopard]

220 +4 Buy 220 Sell 230 [^][^]

It's rising so fast I've got a nose bleed. :)

220 was my end of year target for Mainfreight, this was on the assumption that it was turning more profit than it has so far acheived. However practically all commentators have been bullish about them for a few months and with Mainfrieght and other players in the logistics sector being very upbeat about the second half year my crystal ball says that $2.50 is the minimum for the end of year announcement, when the profit will be [:I]$10M[:I] plus.



These are my guessing for you to throw back at me later.[8D]

[Morch]

Toll has been reported as lining up another major acquisition.
Could MFT be the target???

Happy investing
Morch :)

[madmike]

quote:Originally posted by Morch

Toll has been reported as lining up another major acquisition.
Could MFT be the target???

Happy investing
Morch :)


only chance if plested retires and wants his $$$$$$$$. he'll be selling a few (people) down the drain if he does offload.

my wouldn't you like to hear a few stories i could tell!!!???

[Snow Leopard]

quote:
my crystal ball says that $2.50 is the minimum for the end of year announcement, when the profit will be $18M plus

I have amended this, don't how I went wrong.
But 10M is a definite minimum in my opinion. [Until I amend it again [:I]]

[Snow Leopard]

The SP has gone from $2.16 to $2.35 since Xmas and we have bids at $2.37 and sellers want $2.60 [:0]

The third quarter has just ended and I have a suspicion that some know that the future is looking bright. I have had a target price of $2.50 for the end of year announcement (late May) based upon a NPAT for Mainfreight/Owens of $10M (MFT $12M, OWN -$2M), this would give a P/E of 24. I await the quarter results announcement to update the figures.
Looking forward to the 2005-6 year then I am expecting a significant improvement on the NPAT, the SP to rise well above the market average, but the P/E to come back to something more realistic.

It's looking good [8D]

[scamper]

Gosh, isn't this great! I sure hope the nosebleeds are worth it -- 10% in a week is getting into scarified-rarified territory for me and I 'need to believe' that is it based on solid fundies! [:I] Keep up the analysis, Bright Burner.

I received a glossy newsletter very recently and it made genuinely good reading about a family- and community-oriented company all pulling together -- young and old, high and low, and their families. Almost too good to be true!! [:0] :D

Does anyone know any Mainfreight workers: MacDunk -- what do the tea-ladies have to say?
Good will to all, Scamper. [:X] [:X]

[limegreen]

Mainfreight's newsletters are certainly a refreshing change, it's like being part of a local newsletter. vive le difference!!!

[JAMP]

Hmmmm, 20% plus gain over the previous three months.

Looking forward what can we expect? A period of consolidation as the share looks to justify it's current price-point or is it going to kick on to $2-50+?

Regards JAMP
NZX: BDO MCH MFT MVN RBD SAN SKX SPN VTX
Unlisted: BRK

[Snow Leopard]

Finished last week at $2.44.
Is this the week to hit $2.50[?] (This was my expected price for the Full Year announcement in May 2005)
Just how fast is Mainfreight improving it's bottom line[?]
Where will we be at the end of the year[?] $3.00[?] $3.50[?] $4.00[?]

We just have to wait and see [8D]

[Snow Leopard]

Answer: Yes, 173 shares bought at 250 [:0].

So the next question is: can it stay there or go even higher this week[?]

[JAMP]

What kind of result can we expect come May I wonder? It will need to be a halfway decent one to justify a shareprice above $2-50.

Whilst on the one hand I am inclined to think that momentum has driven this stock north, on the other I am inclined to think that there must be other drivers at play also.

For a while I was expecting an announcement with respect Owens, but no sign of one yet. I see in todays sharemarket news that executive options have been exercised. News in the offing or simply common sense at play?

Regards JAMP
NZX: MCH MFT MVN PPG RBD SAN SKX SPN VTX
Unlisted: BRK

[Snow Leopard]

The 3rd quarter results will be out soon and will give a good indication of the full year, which in itself I do not think will be particularly epic.
However it will also give a good idea of the current and forward levels of trading activity which will make for better reading and justify the share price.
At $2-50 the SP is ahead of my expectations but the market seems to love companies with a growth story at the moment. The difference between MFT and some other high P/E companies is that I expect MFT to increase their profit rapidly (next year) and the P/E to come down to sensible levels, whereas for other companies the P/E is based on expectations further ahead.

With respect to OWN, I will admit that I have seriously considered buying shares in them recently but decided not to on the grounds that
I would have to high a percentage of the long term portfolio in MFT/OWN. You may note that 90,000 changed hands yesterday at $1-00, someone has been trying to buy for the last few days and seems to have accepted that was what they have to pay. Personally I would expect divvies from OWN starting in the next financial year.
Once the re-building of OWN has stabilised then it will be in profit and the SP is going to rise along with MFT. I will revisit my decision on buying OWN when I have enough extra cents to buy it and keep the LT portfolio balanced, but may well buy more MFT instead.

Short term who knows what the market will do with the price, long term it has a way to go up yet.

Disc: dedicated MFT fan and shareholder. [8D]

[limegreen]

BID 2.60, ASK 2.63, No sales today!

I double dare someone to enter an at-market trade...

Actually scratch that, someone just put their shares on at 2.60. mmmm ah mmmm ah

Not many sellers, but very hopeful

2.60 2,142 1
2.63 1,000 1
2.65 1,970 2
3.00 2,000 1
3.03 10,000 1

[JAMP]

<center>http://img.villagephotos.com/p/2004-10/854812/ScreenHunter_mft.jpg</center>
<div align="right">snapshot courtesy of www.bigcharts.com</div id="right">

I hope that MFT have their load securely tied down with a nice low centre of gravity. I also hope that if they have to come down the other side of the incline they are currently climbing that they intend to use engine braking.

Obviously they are confident that they are driving within their limitations. A good thing, as to my mind their shareprice is at very serious risk of a roll-over if they fail to negotiate the path ahead with great skill.

Regards JAMP
NZX: MCH MFT MVN PPG RBD SAN SKX SPN VTX
Unlisted: BRK

[Snow Leopard]

The summit keeps getting further away :)

[scamper]

My reading of the chart is that a buy is still indicated (beware, scamper is notoriously dodgy at this -- see AIR thread...):

Mft trendline still solidly intact for the last six months -- would need a drop below 235 to break it.
Stochastics good, macd positive.
Shareprice has broken above top Bollinger band -- good.
DMI+ and ADX well above DMI-, DMI+ is above ADX -- all good.

Cautions: ADX has been dropping slightly and is currently flat -- a buy signal is indicated when it rises keeping the DMI+ above it.
RSI is drifting downward, and W%R is at the overbought position.

So, yesterday's close is above Jamp's price channel, and it does indeed look at though the summit keeps getting farther away.

Scamper's holding with all paws. Cheers.

[Snow Leopard]

Q3 Results:
[quote]quote:
MFT
22/02/2005
QUARTER

REL: 0930 HRS Mainfreight Limited

QUARTER: MFT: Mainfreight Result to December 2004

MAINFREIGHT LIMITED GROUP

FINANCIAL RESULT FOR NINE MONTHS ENDED DECEMBER 2004 (UNAUDITED)

The Mainfreight Group of companies (inclusive of the consolidated Owens
Group) is pleased to report a Net Profit after Taxation of $7.7 million for
the first nine months of the 2005 financial year. This represents a 20%
increase when compared to the same period last year.

Revenues increased to $671 million, an increase of 50%. Excluding
acquisition and foreign exchange movements this increase was 15%.

Group EBITDA was 35% higher than last year, at $31.1 million, compared to
$23.1 million. Abnormal costs for the nine months total $3.1 million after
tax and minority share of which the third quarter abnormals were $1.4 million
after tax and minority share. All abnormal costs were related to activities
within the Owens Group.

Group cash flows were impacted by the retirement of $13.5m Bank Debt and
unusual working capital requirements for Owens. Now that the Owens'
divestment process is complete cash flows will directly reflect the
underlying success of the businesses.

During the third quarter, trading across the Group was very satisfactory.
Strong economic activity and performance from our businesses in New Zealand
and Australia saw most divisions improve over the same period last year.
Trading indicators into the fourth quarter to date will provide a pleasing
full year result.

Divisional Commentary
New Zealand Domestic
Revenues have increased 10% year to date with EBIT improving 14% to $16.6
million. Trading remains steady at the present time, particularly in the
fast moving consumer goods sector where our profile continues to grow.

New Zealand International
International freight activity remains strong. Mainfreight International
continues its development utilising our presence in Australia, Asia and the
United States. However EBIT declined to $1.2 million from $1.8 million as a
direct result of Lep International rebuilding after a disappointing year.

Australian Domestic
Revenue growth continues to strengthen, up 44% to $58 million excluding
foreign exchange movements.

Year to date EBIT continues its recovery from negative $4.2 million to
negative $0.3 million. Third quarter EBIT was positive $1.2 million. While
the fourth quarter is unlikely to produce a similar EBIT due to the
seasonality of freight movements, further improvement compared to the same
period last year is expected.

Australian International
The strong trading trends from our first half result continue for this
division. Year to date revenues excluding foreign exchange and acquisitions
were up 19% to $155 million. EBIT continued it's improvement up 46% to $4.7
million. Further progress is expected as Mainfreight International continues
its merger with Owens International Australia. Strong international trading
conditions have assisted Lep International in recording record profit levels.

USA and Asia
CaroTrans continues a solid performance with EBIT increased by $1 million.
The port disruptions and terminal congestion in the USA having little impact.

Our Asian interests continue to grow and provide good profitability. We
anticipate this to continue as we expand in the region.

Our growth in these countries is increasing our international trade volumes
and is providing enhanced supply chain opportunities to our customers in New
Zealand and Australia.

Owens Group
With the divestment and restructure changes completed within the first half
of this year, the quarterly performance provided significant improvement over
previous periods.

EBITDA year to date is negative $0.10 million whilst this third quarter
provided a positive EBITDA contribution of $1.8 million. Some abnormal costs
will be incurred prior to year end with

[Snow Leopard]

Immediate comments on this result:

The NPAT for this quarter is $6.55m (7.7 - 1.15 at Q2). This equates to $26.2m pa and gives a P/E of 9.44 at the closing price yesterday. The not to subtle hint is that there is better to come.

Owens is now effectively profitable and most of the re-structuring is done.

Disc: Happy as

[limegreen]

MMM ah. It seems such a good result was anticipated, so no dramatic action just yet.

DISC: roll on double money :)

[Snow Leopard]

I sat down with the spreadsheet last night, tried to get the recent Mainfreight 3/4 announcement and it to agree. Having done that by making the usual wild assumptions I then projected forward and based on current revenue etc being maintained here is what the spreadsheet says for the future.

Full year 2004-05
Operating revenue: $910,894,000
EBITDA: $48,018,000
Profit: $17,532,000

Comment: Seems a little high to me but then I have consistently underestimated the results recently.

Full year 2005-06
Operating revenue: $959,532,000
EBITDA: $67,408,000
Profit: $30,758,000

Comment: Remember this based on current levels, I am sure that there is more improvement in profitability to come as well as expansion of revenue next year. Based on this predicted share price for end of 2005 is
$3.30 (on a forward P/E 10.28) absolute minimum. :)

Paper Tiger

[rmbbrave]

Is the collapse of Phoenix Freight good news for MFT?

Who will Phoenix's customers turn to?

Or, is a collapse in any industry bad news for others in the industry?


Freight company's collapse leaves 1000 creditors and 150 jobless

08.03.05


A national freight company has gone under, leaving at least 150 people without jobs and more than 1000 creditors with no idea when or if they will get paid.

Liquidator Jeff Meltzer, of Meltzer Mason Heath, said yesterday that Phoenix Freight had gone into voluntary liquidation, leaving 143 staff "technically redundant".

Auckland was the hardest hit, with 62 jobs lost, followed by Wellington, with 32 staff let go.

In Christchurch, 26 staff and seven owner-drivers are collectively owed more than $150,000 in arrears.

Phoenix was set up in Auckland in 1983 on a small scale but grew to have a national network that delivered to 273 New Zealand towns and cities.

Mr Meltzer said he was appointed by Phoenix on advice from its own lawyer.

"While I was appointed by shareholders ... my role is to work for the employees and owner-drivers and those that are creditors of the company," he said.

Phoenix shareholders told Meltzer they had poured money into the business since buying it in October 2003 but the loss of a major customer late last year meant it was no longer feasible to keep the business running.

Mr Meltzer said he hoped to have a first report to creditors by the end of the week, giving them an indication of how much was owed in total and what percentage they could expect back.

"That will give indicative figures from the information we've been able to glean from the company records," he said.

It will be an anxious wait for Christchurch owner-drivers Brian and Joy Terris, who were banking on the earnings for their upcoming retirement.

For the couple - also business partners in the truck which Mr Terris drives - the liquidation has a sense of deja vu.

The collapse of Phoenix is the fourth time Mr Terris has been working for a company that went bust, and he has been left out of pocket each time.

[Snow Leopard]

Here is a company that turned 6.6m profit last quarter which gives a current P/E of less than 9.3 (assuming a price of 2.55) if you annualise it. It is being sold down in the market by the general sentiment.

There is better to come from this company, so I think you should take a good look at it.

Disc: MFT

[limegreen]

Oh I am my friend. I'm in the process of topping up some of my core holdings. FBU was the first to get lucky. MFT is certainly on the shopping list.

[Snow Leopard]

The general descent of the market appears to have stopped for the moment and Mainfreight is sitting on $2.50, which if I understand the TA correctly, is a support level.
The fundamentals are good so I have been buying today.

[limegreen]

$2.50 does look like some light support. I'm waiting for the RSI to head north. I'm happy not to top up quite at the bottom, but to make sure that the SP is heading north again as well:)

[Snow Leopard]

Good to see that Tower have bought another 1% of MFT whilst they are both undervalued by the market. :)

Disc MFT & TWR

[winner69]

quote:Originally posted by Paper Tiger

Good to see that Tower have bought another 1% of MFT whilst they are both undervalued by the market. :)

Disc MFT & TWR


The connection being?

[Snow Leopard]

Someone is giving MFT shares away for a mere $2.50 each for you bargin hunters out there.

Disc: Have lots and I am keeping them.

[limegreen]

I was quite surprised to see only a buyer at $2 at open this morning. I was tempted to put in an order at $2.01 myself, in case anyone was so foolish!

[scamper]

I'm altogether mystified about the recent share price performance! [:0]

I think we are agreed that the 22 Feb report for Q3 was a good'un: +20% over same period last year; rev +50% or, excluding acquisitions and forex, +15%; and "trading indicators into Q4 to date will provide a pleasing full-year result".

so, is there a secret something that we don't know about -- the downward wobbles start well before the rest of the market's. I notice that the price was also 250 on 18 March (was P.Tiger a buyer?).

My scan of the charts indicate that mft is not a buy atm, because indicators suggest there is more downside to come. I guess the price has well outstripped the divi (about 2.5% at 255), so it could be that people are taking the capital gain.

I would dearly love to increase my holding, because the fundamentals are so good, as per PT's post above. however, I reckon the next few weeks will continue to drift unless some news comes out.

I sort of see that 245 may be a resistance level -- anybody have any ideas about when scamper should top up? [:I]

[Snow Leopard]

I will admit I bought MFT last time they were down this far, but as trading stock and I sold them at $2.64 not long after.
Unfortunately I have no spare cash at this moment otherwise I would take another punt.
Where the price goes in the near future I can not predict but you could put a bid in at some sensible number and see if you get a bite.

Good fishing ;)

PS The downward wobbles started 10-Mar with the rest of the market.
PPS so much of this stock is held by institutions at this moment with various Fisher controlled funds and Tower etc and I do not see them selling out in the near future.

[limegreen]

MFT could be good buying today. After breaking through support at 2.40, and then finding some resistance back up through 2.40, it seems the SP might turn round and close back through 2.40 today. It has yet to break it's recent downtrend, but some room for cautious optimism.

DISC: interested buyer

[optiontrader]

Personally I thought that MFT is not ripe for a buy for a year or so, until they increase their net profit. Their rev is twice their cap which is good, but their net is so low that their P/E is 66.5! Their profit margin is not healthy either, which I think means they will need to go through a streamlining process in the next couple of years. If the increases continue and share price stays about equal, then I think a buy when their P/E is down to 10. Plus it is not a value buy yet, as the companies equity is less than its market cap

[limegreen]

quote:Originally posted by optiontrader

their net is so low that their P/E is 66.5!


I don't profess to really understand company financials (mostly coming from a technical perspective), but you can calculate their P/E on a lot of different figures, and it seems that you've either borrowed an automatically calculated one, or are deliberately making an extreme calculation. Looking at their performance for the first 9 months, I get an EPS of 10.7, giving a PE of about 23. Although this wouldn't be the first time I've shown my extreme ignorance of such things.

[optiontrader]

Yes, I see where you got your information from, I just picked up my P/E from nzx. Excellent then, MFI's P/E is coming down fast. I will purchase when it reaches 10-12

[Snow Leopard]

LOL :D

So, if was currently trading on a P/E of 8.9, would you buy it?

1/4, 1/2, & 3/4 financials are out, read them, use a calculator.
End of year financials are 5 weeks away. [:p]

[optiontrader]

Of course I would at 8.9 :)

[rmbbrave]

Here are the fundamentals for MFT given by Direct Broking.

They don't look good. The P/E is 65 - which is terrible.


Fundamentals : Mainfreight Limited Ordinary Shares

Total Issue 95,887,190

Market Capitalisation $230,129,256 (@ 240)

Full Year Profit 3,441,000.00 (NZD)

Earnings/Share 3.6900 cents

Price/Earnings Ratio 65.0407

NTA/Share 35.4700 (NZD) cents

Dividend/Share 6.5000 (NZD) cents

Dividend Yield 2.7%


Fin Data has a differnet set of figures with a P/E of 29.

Sector: Transport
PE: 28.96
EPS: 0.0694
Dividend: 0.097
Market Cap: $234,923,600
NTA: 0.2871
52 Week High/Low: 2.75 / 1.74

I don't know which of these is most out of date but there are plenty of good compnies with P/E's of 10-15 about.

[winner69]

Last years reported profit was $5.968M - ie 6.2cents a share ... at 245 a PE of 39.

The problem with MFT financials is there are so many restructuring costs, abnormals and all that sort of crap you have to be a Mainfrieght insider to know what is really going on.

At least they seem to now reporting consolidated group earnings ... presumably because they are now in profit after reporting a loss in the 1st quarter of the year.

Reported NPAT this year will prob be in excess of $10M - say 10 cents a share. Strip out a lot of one off sort of stuff if you want and eps prob be about 16 c/s ... giving it a pe of about 15. This is a bit more respectable but assumes that all the one off sort of crap and other excuses will be gone in the future

Some are forecasting eps of 25 cents next year - if this eventuates than todays 245 might be cheap

However too unclear and too hard to assess what is crap in the results and what is likely in the future for me to get too interested ... and MFT is priced today assuming that everything will be alright.

[winner69]

In other words leave any purchase decision to the charts

[Snow Leopard]

This just gets funnier. :D

So optiontrader, have you done the sums like I suggested?
Or are you just going to buy some MFT tomorrow given that you think they are such a good deal?

Quoted figures are often wrong, rmbbraves post shows that.
P/E ratios of historical profit, even if it is correct, and current share price can tell a very misleading story.

[optiontrader]

I have got my calculator out, and I can't see where you are getting your P/E of 8.9 from... therefore I don't see them as a good deal at the moment, as I said before, in a few years perhaps

[optiontrader]

MFT is not quite ripe enough yet, I agree with winner69, the charts should rule for a bit here

[Snow Leopard]

Optiontrader:
The profit for the third quarter was $6.6M (i.e. the running profit for the year, went from $1.1M to $7.7M) Annualise that and you get a P/E of 8.9. The fourth quarter was probably better yet.

But the real question is where does it go from here and not where was it last year. ;)

[limegreen]

quote:Originally posted by optiontrader

MFT is not quite ripe enough yet, I agree with winner69, the charts should rule for a bit here


... which was the original point of my post(!), I was just too lazy to post a chart. So anyway, MFT is a bit hard to fit a trend to (in part because I can't get it with a log scale). Suffice to say, that it's declined fairly heavily from its highs, and would have broken a trailing stop if I could draw one. It also recently looked like support had turned into resistance at $2.40, but it closed through that yesterday. However, a more conservative buy signal would be to wait until the current short-term downtrend (red line), has broken. It's stilll ages away from the appropriate moving average, but you'd have lost a lot of profit by then.

http://img.photobucket.com/albums/v361/limegreenz/mft27april05.gif

UPDATE 5:11PM. So much for the optimism of yesterday. Definitely time to hold off, and glad that I did. I'm definitely inclined to wait for real signs of a recovery.

[optiontrader]

quote:Originally posted by Paper Tiger

Optiontrader:
The profit for the third quarter was $6.6M (i.e. the running profit for the year, went from $1.1M to $7.7M) Annualise that and you get a P/E of 8.9. The fourth quarter was probably better yet.

But the real question is where does it go from here and not where was it last year. ;)



Yes tiger, but so far the profit is only 20% above the same period of last year. The fourth was by far the weakest period last year, where the firm lost money! A 50 - 50 chance that the fourth period will be different from last years is not good enough for me at the moment, though it may be a good bet for the future when the fundamentals become clear :)

[rmbbrave]

Down 5.3% today.

I held MFT all the way from 140 to 255 for a couple of years but I sold up recently as I reckon it is overpriced.

If we have been unable to agree on it's P/E -somewhere between 70 and 8.9 - what do you think the "market" makes of MFT?

I have a feeling "the market" is uncertain and the SP will fall further.

Sell up PT and take your profits now.

[limegreen]

quote:Originally posted by optiontrader
The fourth was by far the weakest period last year, where the firm lost money! A 50 - 50 chance that the fourth period will be different from last years is not good enough for me at the moment, though it may be a good bet for the future when the fundamentals become clear :)


The neat advantage of TA is that you don't have to do much homework. However, with the fundamental stuff, you actually have to read stuff. Thus, when considering that the fourth quarter was by far the weakest period last year, you should perhaps consider that that was because of the major Owens acquisition, which, given they didn't make a major acquisition, is likely to be different this year. And if you wait until the fundamentals become clear, you may have missed the bus (unless there is a real earnings surprise). Just playing devil's avocado with you a little. I'm not buying at the moment, but for very, very different reasons.

[Snow Leopard]

Oh yea of little faith :)

[limegreen]

quote:Originally posted by Paper Tiger

Oh yea of little faith :)


I have some faith in MFT my papery tigery friend, just not in the market's perception of that venerated entity. I know that you're a sometime practionary of the dark chart arts. If it closes through $2.20, there's really not much in the way of redemption. Or do you see it otherwise?[:0]

[Snow Leopard]

Well, consulting the charts, I have a 200MA at 2.24, and a long term trend line (through lows at 08/12/03 and 25/10/04) at 2.18 as of today. So it is getting a bit tight.

Obviously it is currently in a short term downtrend and needs some serious boost to break that.

Fundamentally speaking, I still think this is pretty solid, but you must be all fed up hearing me go on about that.
The problem really is the general attitude of the market. But then I am not buying either yet.

My current strategy is to hold what I have got, and wait for the full year results in about 4 weeks.
When the share price turns I will buy more to trade short/medium term, I did that successfully at the beginning of the month.

This is rated one of the better buys in the market by analysts, FBU is another.

[limegreen]

That 200MA kept me in in October:), but I've felt the SP has been too far off that for it to be much use of an indicator of late. However, I'm in agreement, when things start to turn around MFT and FBU will be excellent buying. Always happy to hear your take on fundamentals. You've seen how arse I am at that...:)

[Snow Leopard]

$2.20 has been the daily low the last 4 days. I have taken a punt that the line will hold.

[Snow Leopard]

[:p] :) [8D] [}:)] ;)

[limegreen]

Not much of a price kick for what ought to be good news. Still watching from the sidelines...

[Snow Leopard]

quote:Originally posted by limegreen

Not much of a price kick for what ought to be good news. Still watching from the sidelines...


and now [?]

[limegreen]

Still sitting on my hands index watching. It's currently looking like it will close around 3000. that means on Monday, it will either close higher, making it look more like it might be the end of the downtrend. Alternatively, if it closes down again, it mighe end up being a Double Bottom, or a Head and Shoulders Bottom. Either way, once the index is looking healthier, I'll start looking for a buy signal in earnest from our favourite company...

[Snow Leopard]

Looks like you missed out on this nice little rush limegreen.

Full year results out within a week, I wonder what the numbers will be?
I will be happy with NPAT of $14.3m or more, my model says more.

[limegreen]

I did miss some of it:(
However, I didn't miss all of it, Allah be Praised. As a further sign of good faith, my present holding is actually bigger than the one I sold down...

[Snow Leopard]

quote:Originally posted by Paper Tiger

$2.20 has been the daily low the last 4 days. I have taken a punt that the line will hold.

Well the line did not hold, but I kept the them until today now all sold. [:p]

Disc: Still have plenty of MFT in the long term portfolio, and playing [on] the swings as well.

[Snow Leopard]

Found; A Buy In NZ Equities Market (http://www.aireview.com/index.php?act=view&catid=2&id=1957) from todays aireview

[Snow Leopard]

Me again. :D

Full year is out with the headline figure being $13.5m, which is $0.8m below my low estimate [V]
The market seems to be happy enough :)

Divvy 3.5cps (year total 6.5cps) as usual but a review upwards likely [:p]
Future looking brighter [8D]

[limegreen]

Fancy you posting here again. Fancy me posting here again. You know I'm not much on this reading announcement stuff, but I was pleased to read this:
"Trading for April and May remains positive and is ahead of the same period last year. We expect this to continue through the first quarter."
which suggests they're not experiencing too much softness from a slowing economy yada.:D[8D]

[rmbbrave]

Mainfreight posts huge spike in annual profit to $13.5 million





30.05.05 1.00pm


Transport operator Mainfreight Group today posted a March year net profit after tax of $13.5 million, up 126 per cent on the previous year's $5.9m surplus.

The result included Owens trading and purchase related costs, the firm said in statement to NZX today.

Mainfreight is soon to own all of Owens after amassing 91.58 per cent of its shares and sparking an automatic full takeover.

Owens today posted a net loss of $3.254m for the March year, which included restructuring costs after tax of $3.818m.

Meanwhile, Mainfreight's profit came on consolidated revenue of $857,043, up $197,169 on the year before.

Excluding foreign exchange movements and acquisition revenues, Mainfreight's sales rose 13.6 per cent in the 2004/05 year.

It said the bottom line was more than expected, and delivered through "better performance" across its various units.

It confirmed a final fully imputed dividend of 3.5c per share, payable on July 22, which took the total fully imputed dividend for 2004/05 to 6.5cps.

Highlights during the year included a substantial reduction in losses in Mainfreight's Australian domestic operations.

There were also large profit spikes from its Australia, United States, Asian and international operations.

The New Zealand domestic business continued to be both strong and profitable, Mainfreight said in the statement.

In New Zealand, domestic revenue rose 10.7 per cent to $201.1m, while earnings before interest and tax (ebit) was up 12.3 per cent at $22.9m.

New Zealand international revenues and ebit were respectively $66.1m and $1.9m, Mainfreight said.

Australian domestic revenues, excluding foreign exchange movements, rose 41.1 per cent, while ebit improved to a negative $315,000, from a negative $5.5m in 2003/04.

Australian international operations saw revenue rise to $199,017, and ebit gained 55.6 per cent to $7.161m.

USA International CaroTrans improved revenues by 29.8 per cent to US$51.9m ($73.59m). Ebit improved to US$1.2m.

Revenue from the Asian Associates unit rose to US$ 12.0m, which resulted in ebit of US$1.142m, up 21.6 per cent.

During the year, Mainfreight Group repaid $20.2m of borrowings.

Mainfreight said its 2004/05 performance would provide a sound platform for future growth.

The full takeover of Owens would likely be completed by early August, that firm delisting in mid-July.

"The consolidation of Owens Group into Mainfreight will enable greater operating synergies and cost reductions are likely with less administrative activity," Mainfreight said.

"Trading for April and May remains positive and is ahead of the same period last year," the firm said.

"We expect this to continue through the first quarter."

Ten days ago, Mainfreight confirmed it had bought Toll Holdings' 11.58 per cent in Owens for $1.17 a share.

That deal lifted Mainfreight's stake above the 90 per cent threshold that sparks a compulsory takeover.

Shortly after 10am, Mainfreight shares were up 6c at $2.50, while those in Owens were unchanged at $1.15.

- NZPA

[Lawso]

MFT is not a stock I follow but I reckon the NZSX surveillance panel should be taking a hard look at the s p movement over recent days, pre-announcement. On May 19 the price was down to 210, then it rose pretty swiftly to close on Friday at 244, a 16% jump in six trading days. Just good guessing or did some people know something?

[Snow Leopard]

quote:Originally posted by Lawso

MFT is not a stock I follow but I reckon the NZSX surveillance panel should be taking a hard look at the s p movement over recent days, pre-announcement. On May 19 the price was down to 210, then it rose pretty swiftly to close on Friday at 244, a 16% jump in six trading days. Just good guessing or did some people know something?


Yes, they knew there had been an announcement that Mainfreight had acheived a full takeover of Owens as I said quite clearly in this post:

quote:
[:p] :) [8D] [}:)] ;)

[Lawso]

So that's what [:p] :) [8D] [}:)] ;) was all about.

[Snow Leopard]

[:p] Toll have sold their Owens share to Mainfreight
:) The share price will go up
[8D] It will help their future profitability
[}:)] Toll only made 1 cent per share on 18 months Owens ownership
;) I told you all it was going to happen.

[Snow Leopard]

$2.70 on Friday.

Disc: One Happy Tiger

[limegreen]

A happy day indeed:D

DISC: After recent upheavals, now MFT heavy.

[limegreen]

All time high at close???? here's hoping! [:0]

[Snow Leopard]

quote:Originally posted by limegreen

All time high at close???? here's hoping! [:0]

encore?

[Snow Leopard]

Well well, yet another high, $2.83 this time.

[limegreen]

I keep getting tempted to post optimistic predictions. However, rather than test fate, I'm happy to let the SP do the talking. But if I did that, then it would end up seeming like the Thread of Paper Tiger and Limegreen Gloating. Oh wait... :D

[Snow Leopard]

Don't worry limegreen, the "it can't go any higher, time to sell" and/or "it's dropped N cents you should have sold" posts will come along at some point and provide a bit of balance.

I am gently kicking myself for not buying some trading stock at $2.35 a while back soon after selling them at $2.50.

Still can't complain, no one listens.

[Snow Leopard]

A month of quite on the thread.
AGM today and the price is trying for a new high.
The men at the top say there is more growth ahead. But, the're bound to say that aren't they?

[8D]

[limegreen]

I hadn't realised we hadn't caught up on this for a month. July has really flown by. Seems to be moving along happily enough. I guess it's just a matter of waiting to see if full own of OWN works out :D

[Snow Leopard]

$3 [8D]

[Lizard]

Bought in at $1.28. But did a dumb thing and sold out just before $2.... I am so kicking myself.......

[scamper]

hello lime tiger and green paper!
you are not gloating on your own. scamper's been at it in absentia! have been away for three months and am right out of the news loop, so am grateful for your posts.

am actually a bit surprised at the giddy heights -- why should this share keep on climbing?
- please could one of you do a brief forecast and news catch-up for me.
many thanks, cheers, scamper.

[The GrandMaster]

quote:Originally posted by Lizard

Bought in at $1.28. But did a dumb thing and sold out just before $2.... I am so kicking myself.......


Bad luck my scaly friend. I bought at $1.06 and have nearly sold some or all of those on numerous occassions. Happy holder :)

TGM

[Snow Leopard]

quote:Originally posted by Lizard

Bought in at $1.28. But did a dumb thing and sold out just before $2.... I am so kicking myself.......

Well you turned a nice profit, so I am not sure the self-abuse is really justified.

[Snow Leopard]

quote:Originally posted by scamper

hello lime tiger and green paper!
you are not gloating on your own. scamper's been at it in absentia! have been away for three months and am right out of the news loop, so am grateful for your posts.

am actually a bit surprised at the giddy heights -- why should this share keep on climbing?
- please could one of you do a brief forecast and news catch-up for me.
many thanks, cheers, scamper.


limegreen & Paper Tiger the dynamic duo of freight analysis [8D]

Why should this share keep on climbing? Well, why not?
Do some sums. Last year full year was $13.5m but only $1.1m at half year. Owens is now integrated and add the recent bonus of full ownership! They have a growth plan based on expanding internationally and nationally, what more could you want?

[Snow Leopard]

Mainfreight stalled due to a lack of sellers (first at 330)

[rmbbrave]

Buyers..................Sellers

7,340 301..............330 15,000

10,280 300.............345 25,000

6,000 296..............373 5,000

4,000 295

[Snow Leopard]

Well a nice end to the day. $3.06 on lightish turnover. No sellers have come along to fill the gap below $3.30.

At the moment the concensus full year (Mar-06) profit is about $27m
so we are now trading on a forward P/E of 10.9, not bad for a growth company. $3.30 would be a P/E of 11.7.
Will be interesting to see if the bids keep sneaking up or a few more adventurous sellers appear.
The first quarterly announcement is due at the end of the month.

[Futurz]

quote:Originally posted by Paper Tiger

Well a nice end to the day. $3.06 on lightish turnover. No sellers have come along to fill the gap below $3.30.

At the moment the concensus full year (Mar-06) profit is about $27m
so we are now trading on a forward P/E of 10.9, not bad for a growth company. $3.30 would be a P/E of 11.7.
Will be interesting to see if the bids keep sneaking up or a few more adventurous sellers appear.
The first quarterly announcement is due at the end of the month.



The 1st Quarter result is out on the 19th August. I had a small punt on these last Friday with this result in mind. Got in at $2.90 so I'm up about 7% already. [8D]

Fingers crossed for a good result:D

[limegreen]

The market seems to think the result will be good. Another happy day for those overweight in Mainfreight:D

[Snow Leopard]

Time to bring the thread back upto the front page.

Ended the day up 6.55% moving from $2.90 to $3.09 with 20,000+ shares changing owner at that latter price.
Quite a step up, but somebody thinks it is a good move.

[Snow Leopard]

This has to be one of the most positive announcements from Mainfreight in a long time. They usually have the word dissappointing somewhere. However there are three "declined"s (but only one is really relevent) to offset the "improved"s and "increase"s.
[quote]quote:
MFT
19/08/2005
QUARTER

REL: 0930 HRS Mainfreight Limited

QUARTER: MFT: Mainfreight First Quarter Release

MAINFREIGHT GROUP LIMITED

Financial result for the three months ended June 2005 (Unaudited)

The Mainfreight Group is pleased to report a net profit after taxation of
$4.229 million for the first three months of the 2006 financial year. This
represents a $4.441 million increase when compared to the same period last
year.

Excluding divested Owens business units, total sales grew $12.947 million, an
increase of 6.5%.

Consolidated revenues (sales) declined to $213.409 million from $222.657
million as a result of divested business revenues of $22.195 million.

This much improved Group performance reflects comments provided in the annual
report and at our annual meeting held in late July. All divisions again
contributed positively to this increase.

Highlights continue to include the improving performance of the Australian
Domestic operations and increasing profit contributions from our Australian
and US International business units. Further, our Owens investments continue
to improve their contributions to our consolidated result with an improvement
of $3.687 million at EBIT level to $1.279 million.

The New Zealand Domestic and International operations continue to provide
strength and profitability as expected.

Divisional Performance

Divisional performances include relevant Owens businesses and are quoted in
New Zealand dollars.

New Zealand Domestic
EBIT improved to $4.591 million, an increase of 43.6% largely as a result of
Owens Transport improvements and the ongoing strength of our core domestic
activities.

Total domestic revenues declined to $65.131 million from $66.533 million, due
solely to Owens Transport eliminating unprofitable revenue streams. Revenues
within "Mainfreight only" businesses continued their increase by a further
5.7%.

New Zealand International
EBIT improved to $0.489 million from $0.016 million. Contributions to this
improvement have come from Owens Coolair and Mainfreight International.

Revenues declined overall by $2.161 million as seasonal perishable volumes
impact.

Australian Domestic
EBIT improved to breakeven levels compared to a deficit last year of $1.388
million.

Revenues continue their improvement with an increase of 13.9% to $23.142
million. Excluding the contribution from Owens Transport Pty Ltd, revenues
increased by 25.4%.

We continue to see positive results from our Australian domestic operations
as the second quarter progresses and expect our target of profitability for
the full year to be achieved.

Australian International
EBIT continues its improvement increasing to $1.928 million, up 124.4%.

Revenues are improved by 15.8% to $70.053 million, largely due to the
increased contributions of the Owens Project and Pacific Island freight
businesses of Pan Orient Pty Ltd.

It is this business which has gained a number of "Project" related contracts,
including the Goro-Nickel contract in Noumea.

As advised at our Annual Meeting, the benefits of the Goro-nickel contract
will begin to flow during our second quarter.

Project activity has a fixed term duration and revenues will fluctuate
accordingly.

Core international activity continues to improve profit contributions and we
expect this to continue for the remainder of the year.

USA International
EBIT continues also to improve from $0.101 million to $0.537 million.
Revenues grew 23.9% to $21.459 million. Again our improvements in this
region are satisfactory and we expect further increasing returns throughout
the year.

Associates
Satisfactory retu

[Futurz]

Have to agree PT, very positive stuff:D Although it was expected and forecast by most in the industry.

A couple of small buyers lining up at $3.15 so it's looking good[8D]

[Futurz]

Last at $3.40[:p]

Go you good thing!!!:D

[limegreen]

Why oh why did I not pick this for the 2005 competition[?] Fortunately, I'm not so foolish in real life :D:D:D:D:D:D:D

Updated to smile some more[8D][8D][8D][8D][8D][8D][8D][8D][8D][8D][8D][8D][8D][8D][8D][8D][8D][8D][8D][8D][8D]

[Snow Leopard]

Some of us did pick it :D
Mind you I also chose Feltex :(

Disc: In real life lots of MFT, and no FTX anymore.

[limegreen]

I also picked FTX.

Disc: Also no more FTX. Thank Allah, I mean Phaedrus.

[Snow Leopard]

$3.55 :)
Another new high, I wonder where Mr Market is willing to take it too [?]
I may treat myself to a glass of wine this evening. ;)

[limegreen]

quote:Originally posted by Paper Tiger
I may treat myself to a glass of wine this evening. ;)


Only one eh PT. Hopefully more good news later in the week :D

[Snow Leopard]

$3.57 :)
Another new high, I am still wonder where Mr Market is willing to take it too [?]
I will treat myself to another glass of wine this evening.

[scamper]

I don't understand why the oil price hikes are being ignored wrt mft's price.
is this company gloriously hedged against rising petrol costs?
i would have thought that the cost of petrol would be a big problem for any transport company -- there's certainly plenty of negative talk about rising oil prices affecting airline profitability and consequently airline share prices.
becoming a nervous holder. cheers, scamper.

[Lizard]

Mostly "Owner-Driver" I think? So they will wear it for a while...but not forever. Also, diesel less affected. But eventually rail becomes more efficient (just need less of a "monopoly" style service!). Perhaps a good time to buy Toll shares?

Still, I see MFT is going up faster than my BGR... where's the emoticon for "Pout"?

[FYA4999]

Maybe its also due to ongoing rumours of a takeover bid from Toll.

-----
Discl : Hold none - sold them a while back :-(

[Snow Leopard]

Lizard is correct that the owner drivers feel the pain of rises in fuel prices in the first instance. But if they persist they have to have be passed on in higher rates to Mainfreight customers. Also MFT use other transporters for international stuff and thus get to pay more directly.

Maybe the rumour is that they are still doing well as we approach their half year and that full year $27m ( P/E = 12.7 )is still expected. NZ doing well, Oz improving, USA and China looking good, divvy increase coming as well.

[Placebo]

quote:where's the emoticon for "Pout"?

Hmmm. Liz, try http://instagiber.net/smiliesdotcom/otn/other/puh.gif or http://instagiber.net/smiliesdotcom/contrib/geno/licktear.gif or http://instagiber.net/smiliesdotcom/contrib/edoom/sad2.gif

Or perhaps http://instagiber.net/smiliesdotcom/ups/unknown/lsvader.gif

[diesel]

quote:Originally posted by Placebo


quote:where's the emoticon for "Pout"?

Hmmm. Liz, try http://instagiber.net/smiliesdotcom/otn/other/puh.gif or http://instagiber.net/smiliesdotcom/contrib/geno/licktear.gif or http://instagiber.net/smiliesdotcom/contrib/edoom/sad2.gif

Or perhaps http://instagiber.net/smiliesdotcom/ups/unknown/lsvader.gif


How bout this one..

http://smileys.smileycentral.com/cat/36/36_20_5.gif

[Snow Leopard]

$3.56 [V]
Down one from it's all time high of yesterday [B)]
I will drown my sorrows with the last glass wine [:0]

[Snow Leopard]

I did not gloat over the climb of Mainfreight to yet another new high of $3.60 yesterday, and very noble of me too. :D

This is just as well as it has shed a few cents to $3.50 today. :(
Damn profit takers!

[limegreen]

Today is International Talk Like a Pirate Day.

DISC: MFT makes me say ooooh ARRRRRRRR:D

[Snow Leopard]

I agree: It is all getting very silly.

[limegreen]

Everyone needs something a little silly every now and then. I'm glad MFT's mine. 'Nother glass or 3 o' wine tonight me 'earties.

[Snow Leopard]

This is the trouble with Mainfreight.
It costs a lot in celebration alcohol, even if you do pick up a 12pack of Tiger Beer on special at New World.

[limegreen]

Better celebration alcohol than commiseration alcohol. With the latter you lose twice[xx(][xx(][xx(]

UPDATE: I don't bother to chart MFT very often, but I note that the price rise has been accompanied by a rather comfortably rising OBV, which is surely a good sign. Not a lot of shares usually change hands in the average day, but there's been good volume underlying the rise.

[hesiod]

OUCH !

Was that a severe case of overheating followed by the hangover ?

[limegreen]

It's only a mild hangover so far, although there has been a bit of volume through. I'm rather optimistic that it might confirm the trend rather than break it. It's still above a 50 day MA and the tentative trend. The current 'hangover' (red) is hardly worse than the other marked here (also in red). About the only cloud on the horizon is a slight turn in the OBV (not displayed)

http://img.photobucket.com/albums/v361/limegreenz/mft27sept05.gif

[Snow Leopard]

Will be interesting to see how far it retraces.

[rmbbrave]

quote:Originally posted by Paper Tiger

Will be interesting to see how far it retraces.


"Interesting" is not the word I would choose. If your holding I think "scary" is a better word.

"Rmblucky" is not holding, he sold his at 3.41 a couple of days ago(bought @ 2.86 in July).

[Snow Leopard]

Weathering the storm with remarkable resilience.
It would seem that your sale was perhaps a little premature rmbbrave, looking back with the benefit of hindsight.
[Arhh, tis a wonderful thing, the hindsight. Tis a pity it always comes late.]

As one or two of you may have worked out I am a dedicated Mainfreight fan, but I must admit even I am surprised by how well the old Share Price is doing.

Disc: still holding for the long term and celebrating regularly, hic! :D

[Snow Leopard]

$3.40 at the end of week, SP down :(, but OBV up [^], over the week.
If you want to draw short term lines ( less than a year ) then you should be out
If you are longer term then maybe you are still in.
Purr-sonally: long term: I still think it has legs: Short term: who knows?

[Snow Leopard]

Got to bring good ol' Mainfreight back up to the front of the queue.

$3.20 down since last post :(, but OBV has risen [^].
It's not just me who likes this one, you know.

[Snow Leopard]

What no conversation about good old Mainfreight in my absence? :)
Pre-half year announcement rally is in progress.
Of course the question is:
Is it justified [?]

Stay tuned for the answer :D.

[Snow Leopard]

The Paper Tiger Monologue continues:

Obviously the world took my last post as a sign to sell given that the price went south from 3.33 all the way down to 3.19 (on little volume)
But today it ends at 3.37, the half year result approaches, the econony has been booming [8D], much stuff has needed shifting :), but fuel costs have been high :(.

So, are you with me on this?

[k1w1]

I'm hovering around this share at present PT,

Are you out of Fletcher Building and NZR which I have had the priviledge of co-owning with you on past occasions ?

[Snow Leopard]

I have my FBU, I think that the market is currently undervalue-ing this one, they should improve their results over the next few years and I see no reason to sell.
I most recently bought NZR and then sold the next trading day. which in retrospect was a really smart move. It would seem that NZR is bouncing around all over the shop, I guess the day to day SP is being dictated by the crude oil price which is a silly game to play. Longish term I am not sure what is the the "right price" for this one, and thus I am not willing to hold.

[k1w1]

I looking forward to reminding you of your comments on the NZR thread at a later date.


For your assistance, crude oil price has nothing to do with NZR profits, which correlate directly to the Singapore refiners margin and the $US/$NZ exchange rate. The higher they go, the larger the profits.

I am positioning on the basis that both of them will remain at present levels or above.

You cant find a source for me that gives a daily of the margin can you PT ?

[Snow Leopard]

Half Year is out. [^]

[scamper]

o dear, well, who cares really...
the last time mft was at 340 i sold half my holding because it was on the way down! i've done this before because i've never quite believed that mft either deserves its price, or can fight off outside influences such as energy costs.
happy to be proved wrong, again.

[limegreen]

Not many shares have gone up post results of late.

DISC: Happy :)

[Snow Leopard]

The very last bullet point from Mainfreight's Analyst Presentation reads as follows:

"Acquisition opportunities being explored after a year of consolidation"

Isn't that nice?

[rmbbrave]

$10m interim for Mainfreight
23 November 2005
By PAM GRAHAM

Mainfreight has sharply increased its interim profit and dividend and is investing in a huge freight depot in Auckland in which rail will pass "right through the middle".


The proudly New Zealand logistics company reported net profit of $10.3 million in the six months to September 30, up from $1.15 million last year when abnormal items from taking over rival Owens Group were working through the accounts.

Excluding some Owens-related abnormals, the profit more than doubled, managing director Don Braid said.

The share price rose 9 cents to $3.49 on news of the result yesterday.

Earnings before interest and tax were $17.59 million, compared with $3.78 million last year. The interim dividend was increased by 2c to 5c a share and is payable on December 16 to shareholders on the register on December 9.

"The current level of performance is expected to continue through the remainder of the year," Mr Braid said.

The company was not ignoring indicators of a slowing economy, but "we have yet to see any impact to domestic freight tonnage".

"Freight tonnage at this point of time in the first six months is the same as last year. That is not a downturn, but it is not improving either."

Mainfreight is investing $6.2 million in a new Auckland depot in Otahuhu, on land the company bought 10 years ago. Freight and warehousing facilities totalling more than 278,710 square metres are planned.

"I don't think there's much bigger," Mr Braid said. "It will be a very effective, efficient freight facility that probably hasn't been seen in New Zealand before."

Mainfreight is looking to use rail freight more but said last month that Toll NZ-run services were as bad as under the previous Tranz Rail ownership.

Analysts said the margins on the Owens business were lower and the purchase increased interest costs but it was important strategically to take out a competitor in an industry that was rationalising.

Warren Doak of Macquarie Equities said Mainfreight was an excellent New Zealand business "and they know how to run it".

The international platform was also starting to move along nicely.

Thirty-eight per cent of the net surplus originated from divisions outside New Zealand. Last year, less than 5 per cent came from overseas.

"I think that is good for our business because we don't have a reliance on just one economy," Mr Braid said. It was also good for the New Zealand economy to have profits from overseas coming in.

The New Zealand International unit increased its interim profit by 60 per cent, Australian International increased earnings by 125 per cent and Australia domestic turned a loss into a small profit.

The earnings of the USA International unit increased by 118 per cent.

Earnings before tax and interest of the New Zealand domestic business rose 32 per cent to $9.74 million on revenue of $132 million, up 2.7 per cent.

Mainfreight took over rival Owens Group when they both had revenues of about $400 million a year, and sold many Owens businesses. The combined company had sales of $438.2 million in the six months, 1.7 per cent higher than last year.

The company would like to crack $1 billion in revenue this year but thought it might be next year.

Mainfreight made equity investments of $14.4 million during the half year, including buying Toll Holdings' share of Owens and further investments in Hirepool, acquired as part of the Owens takeover.

[Snow Leopard]

I found the December edition of the Mainfreight Newsletter waiting for me this evening which is as good an excuse as any to bring this thread back up to the front.
The first edition of this magazine, which is published twice a year, was to be perfectly honest, poor. However since then it has improved markedly and this edition maintains the standard.
The underlying note to the magazine is we are doing well but we can do better.
On the inside front cover Don [Braid] says "Our expectations are to achieve 15% sales growth every year".

This is a company that should keep growing.

[k1w1]

Move over there PT, I've just come aboard ...

[Bob Marley]

Yeah mon, always a good read those nice glossy Mainfreight newsletters. I see the company had a "Mainfreight Idol" competition recently mon but didn't invite loyal shareholder Bob.

I still like the company's fundamentals mon. Bob's expectations for FY06 is around $26m net profit which put MFT on pe of about 13.5 and gross divi yield of about 5%. I think they can still extract some more synergy benefits from Owens too mon and they seem to be turning around their overseas operations mon.

The only thing worrying Bob at the moment mon is the shares' struggle to break through $3.70. This is its third attempt mon.

[Snow Leopard]

$3.71, happy now Bob?

[limegreen]

It's not exactly an emphatic break out, but the time will come...

[Snow Leopard]

Some gone through at $3.80 :)
Could we end today on a new high? I need an excuse to try the local beer [:p]

[limegreen]

quote:Originally posted by Paper Tiger

Some gone through at $3.80 :)
Could we end today on a new high? I need an excuse to try the local beer [:p]


Yes. A few crossed after close last night at $3.73, and the buy/sell was looking optimistic this morning (3.75/3.80). Third quarter results due out in the next week or two? A good omen[:p][:p][?]

[Snow Leopard]

end of day $3.90, recent rise on <s>bugger all</s> not a lot of volume but heh any uptrend remains intact.
So will the third quarter results justify this optimism?
Stay tuned folks :D

[limegreen]

quote:Originally posted by Paper Tiger
So will the third quarter results justify this optimism?


It's just as well we have such a well-regulated and reputable market [:o)], so there's never any chance of insider buying...

[limegreen]

More than usual buying pressure today. Tealady confident of a good result[?]

[Snow Leopard]

Not much more than unusual.
The tealady is always confident and is considering introducing a new range of buns and doughnuts.

[limegreen]

I didn't mean heavy volume. Merely, that if I'd sold out today, it wouldn't have been the largest trade...

[Snow Leopard]

3Q result announced today, Mainfreight being a company who is very willing to front up every 3 months.
You can read the actual announcement here (http://stocknessmonster.com/news-item?S=MFT&E=NZSE&N=127690) and further commentary here here (http://www.stuff.co.nz/stuff/0,2106,3580840a13,00.html).
I know what a lot of you are thinking "Oh no, Paper Tiger and Mainfreight, change the channel".
What you need to consider is the changing balance between the profit contribution of domestic and foreign.
So do you think that the Nz ops will hold their own or decline and will overseas operations continue to improve?

I will say that I think that the professional analysts are expecting a little too much as a full year result for 2006 and too little for 2007.

Anyway at the end of the day, I have done exceptionaly well over the last couple of years with the buy and hold strategy, and the trading company has done slightly better with a trading strategy on MFT. I do not yet think that the party is over.

Disc: :D:D

[Bob Marley]

I agree with you PaperTigerMon. MFT keeps on trucking along mon and I am more upbeat about its global operations after yesterday's comments mon. I think MFT's future is in expanding its global logistics operations mon. Bob is now predicting FY06 NPAT of $29m mon, putting MFT on a modest PE of 13x mon with good overseas growth prospects mon.

".. I don't like cricketa,.. I love it..."

[limegreen]

Ask 4.08 Bid 4.03 Last 4.00

how bout that cricket mon?

[Snow Leopard]

$4.35 and still not fully priced :D

...hopefully

[Snow Leopard]

Sorry, but can not resist a little gloat: :D

[Lizard]

Go for it PT...great stuff. I'm still crying in my wine about that share I sold too early - might be able to say the same about PVO one day.

[k1w1]

quote:Originally posted by k1w1

Move over there PT, I've just come aboard ...



Thanks very much for the tip PT :)

[Snow Leopard]

Yes k1w1, you have done rather well in the few months you have been aboard.

The question is where to after this slendid rise?
Although my figures are notoriously inacurrate and subject to rapid restatement I will go on the record that I believe the full year for 05-06 will be:
NPAT $27m
NPATA $32.5m
and that a share price of $4.64 is my mid-point for the value of MFT at the end of this month.

A year out I hope NPATA will be $37.3, representing 15% growth, and the SP around $5.40.

Still happy and though I think the spectacular growth in SP of the last three years is coming to an end, I do not see it slouching around either.

[Snow Leopard]

End of month was $4.69 as opposed to my guess of $4.64, do I win a prize?

And a week later we have $4.95 so I am glad I hedged by bets with:
"Still happy and though I think the spectacular growth in SP of the last three years is coming to an end, I do not see it slouching around either."

Onwards and upwards.

[Lizard]

Good puss. (stroke, stroke) ;)

[Snow Leopard]

Should Hirepool sell (http://www.stuff.co.nz/stuff/0,2106,3632655a13,00.html) for the $150m talked about then that would put $36m+ cash in Mainfreights pocket which could half their borrowings.
Of course the could also spend some of it on a new acquisition. :)

[Snow Leopard]

Rail upgrade work too slow, says Mainfreight (http://www.stuff.co.nz/stuff/0,2106,3643275a13,00.html)

quote:
Toll NZ is not offering new rail freight services fast enough, pushing more freight on to roads and driving up transport costs, Mainfreight chief executive Don Braid says.


He said yesterday that Mainfreight spent almost $25 million on rail a year. "We think we could double that if we could get services over more routes and to more destinations."

The transport company was passing on the rising fuel prices to its customers but could alleviate this if more freight went by rail, Mr Braid said. "Rail is a far more efficient use of fuel and is a better way to move freight."

He acknowledged that Toll NZ had inherited a rail network that was in bad shape.

There had been some improvement of services on long-haul routes, he said. "But we haven't seen improvement in terms of additional services on a number of routes as quickly as we would have expected."

Toll NZ, which is controlled by Australia's Toll Holdings, bought rail operator Tranz Rail in 2003. The following year, it sold the rail network – apart from the Auckland rail corridor, which Tranz Rail had previously sold – to the Government.

The two parties struck a deal under which Toll was given monopoly access to the network and the Government pledged $200 million to upgrade the network outside Auckland.

If freight levels fall too low Toll risks losing its monopoly.

About $120 million of the pledged amount has been spent but further spending is dependent on the negotiation of access fees between Toll NZ and the Government. These would allow the Government to recover the cost of upgrading the network.

Neither Toll NZ nor the Government is commenting on the negotiations.

Mainfreight would like more services on regional routes such as Hamilton to Christchurch, Hamilton to Palmerston North, Wellington to Christchurch, and Tauranga to Wellington, as well as improved services between its Southdown depot and the port of Auckland.

"These are the sorts of routes that we would like to move a lot more freight over by rail," Mr Braid said.

Toll NZ spokeswoman Sue Foley said she was surprised by Mr Braid's comments given that Toll had introduced a new daily freight service between Hamilton and Christchurch, which Mainfreight was using.

The Government was working on improving the network, but speed restrictions remained, she said. "If the demand is there Toll would be happy to look at providing new services."

Mr Braid said Mainfreight's rail spending as a percentage of total revenue was about half the amount it was five years ago.

"We're moving more freight by road and that's wrong. At a time when freight costs are at an all-time high because of fuel we should be looking at the most efficient way to move our freight."

[limegreen]

Surprised PT hasn't made it here yet.

Mmmm. five dolluh.:D:D:D:D:D:D:D

[Snow Leopard]

$5 makes a nice home coming present :)

Full year results can not be far away now.

[Snow Leopard]

Full year ann tomorrow morning?
Otherwise it must be Wednesday.

Anyway, when it comes out I will be fascinated to see what the share price does.
I put my name to $5.40 for end of March 07 on this very page, how silly of me. :)
A lot can happen in 10 months.

[Snow Leopard]

Full year is out.
Not too shabby.

[Bob Marley]

Paper mon, that is a fantastic result from the big blue trucks mon.

"...One love...."

[Futurz]

Last trade $5.50!

This has been one of best purchases in NZ in recent times. Up 91% in 10 months :D Only wish I'd brought more...

[Snow Leopard]

quote:Originally posted by Bob Marley 23/02/2006


...Bob is now predicting FY06 NPAT of $29m mon...

Spot on. :)

[Snow Leopard]

quote:Originally posted by Paper Tiger

Should Hirepool sell (http://www.stuff.co.nz/stuff/0,2106,3632655a13,00.html) for the $150m talked about then that would put $36m+ cash in Mainfreights pocket which could half their borrowings.
Of course the could also spend some of it on a new acquisition. :)




quote:from todays Analyst Presentation
Sales process underway
Our holding 24.5%, Book Value (including Goodwill) $9.9 million
Expect conclusion mid-year
Proceeds from sale to retire Group debt

So they are going to book a very health profit on the sale as well :)

[limegreen]

quote:Originally posted by Futurz
This has been one of best purchases in NZ in recent times. Up 91% in 10 months :D Only wish I'd brought more...


Good luck or good planning that this is my sole NZX investment over the recent period[?]
doesn't really matter either way. just enjoyin' the ride[8D][8D][8D][8D]

[The GrandMaster]

quote:Originally posted by Futurz

Last trade $5.50!

This has been one of best purchases in NZ in recent times. Up 91% in 10 months :D Only wish I'd brought more...


Up 430% since my purchase way back in 2003 :D

[rmbbrave]

Mainfreight on offshore ride
11 June 2006

By TERRY HALL
Mainfreight is doing exceptionally well in the notoriously difficult transport industry, and is proving that its business model can work successfully overseas.


It is becoming a significant player in Australia, the United States and Asia and its rapidly increasing profitability will not go unnoticed by its international competitors. This suggests it could be a takeover target at a time when cashed-up Australian predators are snapping up some of our best companies.

But Marcus Curley, an analyst with Goldman Sachs JBWere, thinks this is unlikely at present. He believes Bruce Plested, one of the founders who has been a key driver of the company's success, has a firm "No Sale" sign on his 20% stake.

Mainfreight has cleverly - some might say luckily - positioned itself to do well overseas in what looks to be a tepid period of growth in its traditional New Zealand business.

In the past year the proportion of earnings from its overseas subsidiaries rose to 43% (from 23% in 2005). Andrew Mortimer, an analyst with First NZ Capital, says he expects this trend to continue, and be enhanced by more favourable currency movements when earnings are translated to Kiwi dollars.

Earnings, for what is the country's largest freight forwarder offering daily services by road, rail, air and sea, have grown strongly over the past two years. In the year to March 31, adjusted net profit after tax rose by 53% to $35.1 million, which was better than analysts' forecasts.

This was driven by the continued benefits of the merger with former rival Owens and the Australian international division which benefited from high-profit-margin business from its Pan Orient Shipping freight forwarding activities. A solid performance also came from its USA international subsidiary which is doing well exporting to Asia and South America. The sizeable fall in the US/ Kiwi exchange rate this year would have been another plus for this division.

The Australian domestic company rebounded in performance with EBITDA (earnings before interest, tax, depreciation and amortisation) rising from $2.5m to $5.9m. It is moving to a new Sydney site to capitalise on this growth.

Closer to home the core New Zealand business showed revenue growth of just 1.5% at $65.4m, though this still represented 51% of operating profits, down from 75% last year. The company is hoping for benefits from its new Auckland super site due to be commissioned in September.

The performance of the New Zealand division will remain critical for the company, in spite of the remarkable rise in the fortunes of its overseas subsidiaries. Chief executive Don Braid said although the results were pleasing, management knew it had a lot of hard, challenging work ahead.

While the parent company may not be for sale, analysts believe Mainfreight will pocket between $22m and $34m from the sale of its 24.5% sale in Rakino, or Hirepool, which is expected to be finalised soon. According to UBS, proceeds from this sale are likely to be used for acquisitions rather than increasing the dividend.

After years in the doldrums after its 1996 listing, the share price has rocketed over the past three years, rising from a low of $1.62 in 2004 to $3.70 last year. So far this year it has risen from $3.48 to $5.80 and was about $5.70 last week.

Rapidly improving earnings have seen analysts re-evaluate its prospects.

Goldman Sachs JBWere lifted its valuation after the result from $3.81 to $5.60, though after the lift in the share price it said it was maintaining a short-term market perform recommendation, while continuing to recommend it as a long-term buy.

GSJBW says Mainfreight trades at similar multiples to Freightways, its closest New Zealand-based peer. Notwithstanding that, Mainfreight does not look expensive compared to the New Zealand market (with a prospective price earnings multiple of 15 times) and international freight forwarders (between 25 and 35 times).

First NZ Capital has a neutral recommendation, des

[hesiod]

With the focus of Wayne B now clearly on Telecom how will this impact upon the continued success of MFT ? TC have a huge amount of work to do to begin to turn their business around for medium / long term growth so I can't see any quick wins. However I am concerned about the losses for this stellar performer.

[Snow Leopard]

hesiod: What are you talking about?

[hesiod]

Sheepishly ... oops
a small slip of the cerebrum, thinking freightways writing Mainfreight.

[rmbbrave]

Volume of freight set to double

Monday July 3, 2006
By Jenny Keown


Freight volumes are expected to double over the next 15 years, with road transport tipped to pick up the lion's share of the increase, a report says.

The main lobby group for trucking - the Road Transport Forum - commissioned Transport Engineering Research New Zealand to look into how freight would grow and what share would be carried by rail or road.

The report projects that over the next 15 years freight volumes will double to 230 million tonnes, based on the economy growing at an average of 3.5 per cent a year.

The report forecasts the trucking sector to be the main winner - it is picked to carry about 80 per cent of freight by 2020, or 184 million tonnes a year. Rail will carry about 46 million.

Road Transport Forum chief executive Tony Friedlander said: "Rail could play a significant and potentially increased role in handling this freight task, but it is no substitute for an efficient, reliable and safe road transport service."

The research was important to help understand future freight needs, transport policy decisions and investments, Friedlander said.

But Toll New Zealand reacted with scepticism to the report.

Company spokeswoman Sue Foley said it was nonsense to suggest rail could not handle a big increase in volume.

"The rail infrastructure is there, it just needs long-term investment and then we can handle the capacity."

Foley cited the huge uptake in volume on the Waitoa line, reopened in 2005 after 14 years, to carry dairy freight from Morrinsville to Fonterra's Te Rapa dry store facility as one example.

Fonterra expected to move 600,000 tonnes of dairy a year through Te Rapa, and Toll was hoping to carry a large portion of that, she said.

The report said Te Rapa might be able to make a significant difference to how freight was transported in and out of the region but it required long-term contracts and significant investment by Toll and Fonterra to ensure its success.

Friedlander said the report's findings were based on population growth, dairy, manufacturing and freight to the ports.

It expected freight growth to be highest in Auckland, Bay of Plenty, Waikato and Christchurch.

The report noted that one of the main challenges was the lack of information about freight volumes and volume share on road and rail. There also needed to be more research on freight in the regions.

[Snow Leopard]

The share price is quietly getting on the business of maintaining the uptrend.

[Snow Leopard]

$6.05 [8D]

[luckysexice]

Phaedr can you please posted a chart on MFT lately current market price look like it is going under the trendline any time and the market price is over the forba valuation which is 5.70

[scamper]

Good grief lucky, are you sure you're looking at mft? It seems scarily terrific to me!
Still, a good idea to keep a close eye.

[limegreen]

What valuation did ForBar have on Feltex[?]

Seriously though, it depends a little on perspective. I've never managed to get a confirmed trendline on MFT, which makes it a little speculative, but this is a stock that is not stressing me in the least.

Taking a slightly long-term look, I've plotted MFT here on a log scale (as that is more appropriate for such spectacular price growth). As you can see, in the long term, it is above both a tentative trendline and moving average that have seen some holders well over double their investments.

You will also notice a second set of lines on the recent price action. This is an ascending triangle (http://www.marketscreen.com/help/chartpatterns/default.asp?hideHF=&Num=101), a formation that has a likely UPSIDE breakout.

http://img.photobucket.com/albums/v361/limegreenz/mft21aug06.gif

However, if you plot MFT over a shorter time period on a linear axis, then you could have some mild concern. However, it *still* looks like an ascending triangle. I think the most likely scenario is that MFT will break through 6.10, but there is some chance that it might retreat back toward 5.50, but I don't think that will concern long term holders of this stock.

http://img.photobucket.com/albums/v361/limegreenz/mft21aug06_b.gif

[limegreen]

Chickens. Hatching. Must. Resist. Urge.

[Snow Leopard]

quote:Originally posted by Paper Tiger

Yes k1w1, you have done rather well in the few months you have been aboard.

The question is where to after this slendid rise?
Although my figures are notoriously inacurrate and subject to rapid restatement I will go on the record that I believe the full year for 05-06 will be:
NPAT $27m
NPATA $32.5m
and that a share price of $4.64 is my mid-point for the value of MFT at the end of this month.

A year out I hope NPATA will be $37.3, representing 15% growth, and the SP around $5.40.

Still happy and though I think the spectacular growth in SP of the last three years is coming to an end, I do not see it slouching around either.

Done a bit of revision and my current thinking is that NPATA for 2007 will be about 40cps which is about 15% growth. I believe that growth is sustainable moving towards 2008.
So pick your P/E and determine your price, personally I think that this would be trading at a fair value today of $5.51 rising to $6.00 (P/E = 15) for the end of the financial year.
The market has been more enthusiastic than me about MFT and I am the MFT fanatic around here.
I have not actually bought any MFT for ages, I loaded up big time a while ago at an average buy of $1.92 and the damn thing has grown so fast that it keeps going overweight in my long-term porfolio :(.

Anyway fundamentally Mainfreight will continue to grow and improve it financial profits, technically it is still in favour.

[Ttops]

I have not actually bought any MFT for ages, I loaded up big time a while ago at an average buy of $1.92 and the damn thing has grown so fast that it keeps going overweight in my long-term porfolio :(.

Anyway fundamentally Mainfreight will continue to grow and improve it financial profits, technically it is still in favour.

[/quote]
Apparently just like Fisher funds. FF Last bought late 2004 and sold back a bit during 2005. No ramping by FF then? ;) Thanks for the analysis PT [^]
TT

[Snow Leopard]

I have never sold a single MFT share from the long-term portfolio (why sell something while you believe that it has a good future?) and have tried to balance it up by buying other shares. However it still makes up more than up a third of the portfolio.

[Ttops]

quote:Originally posted by Paper Tiger

I have never sold a single MFT share from the long-term portfolio (why sell something while you believe that it has a good future?) and have tried to balance it up by buying other shares. However it still makes up more than up a third of the portfolio.

Glad to hear that you have confidence in MFT. I agree entirely with that principle above. A mere slip of the monkey's tongue to say you were just like FF! [:I] I mean't you bought at the same price/time. Shame they sold even 2% foregoing a much greater profit.

I take from this that you have a trading portfolio as well. Do you do better or worse to trade rather than invest in general terms or is that too difficult to easily assess?

How do you decide exactly when to get out of an investment. I presume you have to have a better alternative lined up as well. With a third invested in one share you must watch it closely. Do you use a trailing stop, moving average and how do you decide? I have seen many different % trailing stops and moving day averages used. Or is fundamental value as important? Is there a principle based on volatility. It would be most helpful for us novices if you could give us some of your experience.

Thanks in advance.

Up again today I see. :)

TT

[Snow Leopard]

Oh no, not another new all time high today. ;)
Trading well above my valuation, so either me or the market is wrong. :)

Disc: MFT

[limegreen]

Yes. Having resisted the urge to count my chickens before they hatched, it would appear that we did in fact have a nice upside breakout from the ascending triangle.:)

Disc: MFT

[Snow Leopard]

quote:Originally posted by Paper Tiger

Oh no, not another new all time high today. ;)
Trading well above my valuation, so either me or the market is wrong. :)

Disc: MFT

Down to $6.46, I hope it is not because of something I said (http://*************nz.jconserv.net/viewtopic.php?t=17)

Disc: I get a virtual can of tuna fish for every click (http://*************nz.jconserv.net/viewtopic.php?t=17) on the link (http://*************nz.jconserv.net/viewtopic.php?t=17) :)

[Snow Leopard]

Mainfreight continues to truck (;)) along nicely. Technically all the indicators are nice and positive. But I find the strength rather surprising and I notice that whilst a number of brokers have upped their full year forecasts some have down graded their buy to hold and there is even one sell [:0].

Wonder what use MFT are going to make of the Hirepool sale proceeds?

Disc: hold MFT and have no intention of selling.

[Snow Leopard]

Half year is out (http://stocknessmonster.com/news-item?S=MFT&E=NZSE&N=140251) [:p]

This is a very good result from continued operations and better than I expected.

Very nice of them to do a 28cps special dividend from the Hirepool sale proceeds, now that is a real surprise.

[rmbbrave]

Up to $7.85 !!!

[Snow Leopard]

Although the Mainfreight share price has been going sideways, ignoring that very nice 35c divvy [:p], for a couple of months now I thing that I can safely say that technically it is still looking good.
Still looks over-priced to me, but I am willing to go with the flow for a while yet.

[scamper]

And ... nearly another four weeks of going sideways, but i suspect it may kick back to life soon.
today's close of 800 has been a resistance level since December, so it may become a support level.

The bollies are also starting to diverge, the macd is looking positive, the rsi's climbed and is now steady.

Parabolic stop and reverse has given the green light, and the 20- and 50-day moving averages look about to cross.

The on-balance-volume has steadily risen over the last three weeks, but is looking a bit soft over the last two days.

if one wanted to draw (dot-in in faint pencil) a downtrend from early december's peak, one could see that this faint and far-fetched downtrend has been broken.
anyway, scamper's waiting to pounce.... cheers.

[scamper]

Well! I never saw that coming!
i suppose if i had been more awake i would've known that results were due...
anyway, it has amply demonstrated that technical analysis can be thoroughly gazumphed by news of fundamental details.
silly-faced puppy.

[limegreen]

quote:Originally posted by scamper
anyway, it has amply demonstrated that technical analysis can be thoroughly gazumphed by news of fundamental details.


Or alternately that you should be a little cautious with thinly traded stocks. Today's "plunge" is on a volume that is miniscule even for this stock. I could personally have triggered a 3% plunge with my laughable holding.

MFT has been trading in a very tight range for some time now (I wouldn't call it a downtrend). Technically, when a share "gaps" up, you expect that to be an area of expected support, and it has not dropped through that yet.

http://img.photobucket.com/albums/v361/limegreenz/mft22feb07.gif

And looking more long term, there's still a rising OBV, and today's price movement is volatile for the last 6 months, but not compared to other blips in its meteoric rise.

http://img.photobucket.com/albums/v361/limegreenz/mft22feb07b.gif

I have no idea if it is over-priced, but I see no reason to believe that the dream has ended yet.

[kizame]

Excellent analysis Limegreen,it's always good to keep the medium to longterm perspective in mind,and bear in mind the overseas expansion with this stock,they are actively looking for medium size acquisitions,especially in the states.
The offshore profitability is improving,this stock will continue to surprise I'm sure.:D

Not a holder though but have been watching to see whether it broke through resistance.

[limegreen]

MFT has always been a little difficult to track with trendlines over the longer term. What is clear, is that it continues to make higher highs and higher lows. The current price drop may well just be a higher low, to be followed by a new high in a few months.

[Snow Leopard]

Mainfreight Announces Divestment (http://stocknessmonster.com/news-item?S=MFT&E=NZSE&N=145642)
It works for me :)

[Viking]

A very satisfacotory result [^][^]

MFT
30/05/2007
FLLYR

REL: 0850 HRS Mainfreight Limited

FLLYR: MFT: Mainfreight Preliminary Announcement Full Year March 2007

MAINFREIGHT GROUP LIMITED

Financial result for the twelve months ended March 2007 (Unaudited)

The Mainfreight Group is pleased to report another record net surplus after taxation before abnormals of $36.4 million for the twelve months of the 2007 financial year. This represents a $7.4 million, or 25% increase when compared to the same period last year.
A further $19.2 million of abnormal gains is added to our net surplus as previously discussed, bringing total net surplus for the year to $55.6 million.

Consolidated revenues (sales) increased to $968 million from $887 million; an increase of $81 million. Excluding foreign exchange this is an increase of 5.5%.

This is a very satisfactory performance, where all divisions in all countries contributed positively to the result.

Our global interests have performed exceptionally well, particularly
Australia and the United States. In both markets this performance will continue to strengthen as we develop market share across the supply chain.

While trading conditions in New Zealand were challenging, we have been able to improve on our last year's performance and are confident of continuing to do so.

In this past year we have been able to achieve good organic growth as well as divesting our interests in four businesses, three subsequent to balance date, which has allowed us to considerably strengthen our balance sheet, pay increased dividends to shareholders, and position ourselves for substantial future growth, assisted in the short-term by acquisition.

Net surplus earnings before abnormals from outside of New Zealand now exceed 54% of our group total, and will continue to grow in significance.

Divisional Performance
New Zealand
Trading conditions in the New Zealand economy were certainly more difficult in the past six months, where domestic freight volumes were markedly decreased and export volumes diminished on the back of the New Zealand currency appreciation.

Our Domestic contributions are satisfactory in light of trading conditions, where EBIT improved 5% on static revenue growth.

The benefits of the Owens and Mainfreight International merger and increased improvement in LEP performance saw EBIT improve 43% to $3.8 million on revenue growth of 3%. Post year end "Owens" has been removed from the brand.

In our domestic operations we continue to build our range of service
offerings utilizing the intensity of our network and warehousing capability. These will provide further opportunities for us to grow our business, increasing the range of services for our customers across the supply chain.

With our International business, our focus continues on growth in our import products and airfreight capability. This directly reflects the changing New Zealand trade patterns. Our regional presence has been strengthened and we expect to open two new branches in Hamilton and Dunedin.

During the year we significantly increased our airfreight growth in both perishable and dry products further enhancing our number one IATA ranking.

Australia
Our growth and presence in Australia continues to rise. Domestically our operations maintained their momentum of the past year, with EBIT improving in excess of 137% to $9.9 million, on a revenue increase of 25%.

In our international divisions our overall result was dampened by the lumpy performance of the projects division, Pan Orient. However EBIT still improved to $13.9 million, up 8% on a revenue increase of 11% to $309 million.
Of greater significance was the performance of Mainfreight International where EBIT improved 34% to $6.1 million and revenues increased 11% to $140 million.

Domestically, our high quality, next day transport services in the express freight market continue to attract customers. We have established a very

[Viking]

The market seem to react positively on the result announced this morning~ perhaps its time to break the side-tracking trend~

[Viking]

By the way, the 25% increase in profit is before the abnormals. If we include the abnormals, their net profit is a gain of 91% [:0]:D

[Snow Leopard]

After having a look at the provisional accounts (http://www.mainfreight.com/Files/Downloads/Preliminary-Full-Year-Report-Annoucement-2007.pdf) for last year I think that the normalised NPATA is 43.5cps, which was ahead of my expectations.
I can see no reason to consider selling any yet. :)

[Snow Leopard]

Arrived back in the nearest thing Australia has to civilisation (i.e Melbourne) today to find the Mainfreight annual report waiting for me.
If you are an existing shareholder then presumably you have read it and are suitably encouraged.
However if you are NOT an existing shareholder, Why not?
You can download the report here (http://www.mainfreight.com/Files/Downloads/AnnualReport2007.pdf) and I suggest it is well worth your monthly data allowance to do so.

Whilst I can give you no guarantee as to the future (but then who can?) I have, over the years, come to appreciate that Mainfreight is one of the few companies who tells it like it is and is definitely focussed on the long-term.

You will realise from the research you undertake after reading the above report that the current high value of the dollar is beneficial to the company from a short-term acquisitions and a future earnings point of view (if you accept the wisdom that the NZ dollar is overvalued)

So if your timeframe extends beyond the end of the year you do need to consider Mainfreight as a medium and long term investment.

On the assumption that they will meet their targets at the long end of Don's statement then you may consider the current SP a little high but I believe you want to put or keep this on the watchlist.

If you want a TA perspective then ask Phaedrus

regards
Paper Tiger

Disc: Lots and not a seller.

[scamper]

gosh PT!
strong talk after a crappy 6 months, but was very grateful for the short version -- still in a rainy french summer. cheers, Scamper

[Phaedrus]

http://h1.ripway.com/Phaedrus/MFT76.gif

[scamper]

Gee, thanks P! rainy french summer just got rainier. and tomorrow am off for a full-day tour of WW1 trenches in the Somme. [B)]
rethinking the wisdom of these 3-month absences is made easier by a haunting sense of fiscal responsibility... cheers!

[Ttops]

Hi Phaedrus
The OBV shows a strange leap or two in May on my free charting program Big Charts. I wondered what you think that meant in this context. Big investor getting in in a downtrend low hoping it was the bottom?

[Phaedrus]

Hi TT, The jumps in OBV that you noticed mark significant buying activity and as such can only be viewed as Bullish. To put these 2 days into perspective, consider this :- The average MFT daily volume is around 120,000. The first atypical step you noticed was of 3.4 million, the second 2.7 million. These were no ordinary "high volume" days and these are not buyers of our calibre, TT. A "Big investor getting in in a downtrend low hoping it was the bottom?" Maybe - we will never know their thoughts. Another view might be "Big investors with insider knowlege buying up large". Some say "Jumps in OBV should be ignored." Not me though!
The MFT OBV did not stop rising when the uptrend ended. This means that it was and is still being accumulated. If MFT had reached the highest value that insiders knew it was worth, they would be selling down, distributing their holdings to smaller players that know a lot less. This is not happening here. Technical conclusion? MFT has further to run and the current downtrend should be monitored closely with a view to buying back in.

[Ttops]

Thanks again Phaedrus for an informative reply. [^] Will be watching. I had an order in the day that big jump occurred and missed by a whisker.

[Viking]

Thank you, Master Phaedrus [^]
I am holding and with a view to bag some more~

[Snow Leopard]

Waiting for lcr@nzx.com to send me a copy of todays speeches from the AGM. I can not find them on the MFT website either.

Anyway today the announce that they have nearly bought one and maybe it will be three US freight forwarders as part of their plan for world domination.
Doing the right stuff, day after day for year after year.

[Hoop]

Agree PT.
An example to others on how to do it right.

Proud to be a shareholder is this one.

Also good to see Bruce Plested taking a pot shot at the Govt....."A growing bureaucracy at local and national levels [is] feeding off valuable GDP growth and slowing our ability to react quickly and efficiently to world markets..."
Unfortunately, I think his statements will fall on deaf ears.It has for the past 7 years or so.

[Hoop]

PT
Us praising MFT's this morning must have put a hex on it ..down 18c
:):):):(

[gravy train]

From my somewhat basic fundamental analysis of this company, MFT look like good value based on their long term prospects and strong history. I recnetly bought my first MFT shares and plan to buy more.

I notice that of late the share price has been dropping and would very much appreciate a view from the more experienced as to whether there is anything behind this.

My thoughts are:

1) An increase in exchange rate again resulting in a decrease.
2) Soem news that is about to surface (or that I have missed) - I read into an announcement today that their CFO Tim Williams is selling shares (245k down to 200k units). I'm new to this so maybe I'm interpreting this incorrectly.

any replies much aprpeciated.

Cheers
GT

Over the last week the share price has been dropping so I have bought my first shares in MFT. They are have dropped further and . Coud

[scamper]

the chart for mft is all gloom at the moment. as a TA person i would recomment staying well away. it has just broken its 3-year up trend.

there is hot debate at times on this forum about analysis of fundamentals vs technicals (charts of share price behaviour). both have their times in the sun.

but if, as you suspect, the fundamentals are good, FA lets you into this share too soon.
as i already mentioned, TA would have you standing well away from this. cheers.

[Hoop]

Welcome Gravy Train to the forum.

Scamper has said it TA wise ...this is not a good time to buy MFT at the moment, even though it had a upward flutter today.

Fundamental Analysis using PE Ratios .... a quick glance MFT looks good e.g PE Ratio 11.6 (11 is considered reasonably low compared to the market average and comparing MFT with FRE which as a PE 19 and both in the same business one would consider MFT as good buying....however looks are deceiving.

Each company has its own natural PE range (the Norm) and that PE Norm only changes if the company changes structurally/management wise...or for some other reason it gets re rated by the investment market.

MFT has had a good stable PE for many years. In 2005-06 and 2006-07 there was an abnormal growth surge, espec 2005-06 where the growth nearly doubled. With companies that have large growth rates i.e 100&#37; a PE value of 50 is seen as not unreasonable, Rakon (RAK) is a good example of that.

Now MFT at the present day.. it's growth has slowed back to nearly its "norm" so we now expect its PE values to come down back it their "norms" as well
To get what is the PE norm for MFT we go to its history

Year ending 31 March 1996 PE 9.5
1997 9.6
1998 7.9 (depressed shareprice due to Asian crisis.. time to buy!!!!)
1999 9.0
2000 9.1
2001 11.6
2002 11.9
2003 9.8
2004 29.0 (shareprice increases in anticipation of large future growth..Buy!)
2005 18.0
2006 15.3
2007 12.6
Now 11.6
So I suggest the PE norm is around 9.5 to 11.5 range

Therefore target price range as at 31-9-2007
Target price (TP) = PE x eps
Growth rate running at 6% at present
Therefore 57.65cps (31-3-07) x 6% = 61.1

TP Range = 9.5 x 61.1 = 580cents
=11.5 x 61.1 = 702cents

Latest share price 5.00pm 679cents up 12c

As there is still modest growth with MFT a PE of 9.5 seems rather low (harsh) at todays perpective..however one has to be reminded that we have had some moderate corrections rippling through the market recently and this bull market is mature and chances are that it may falter with a major correction or two.
As seen above in 1998 with the Asian crisis ..that severe correction bought MFT PE back to 7.9. So from that perpective 9.5 sounds generous.

So to be conservative I used a TP range using a PE norm range of 9.5 -11.5 for my decisions.

Therefore from a FA point of view MFT shareprice is neutral with a possible downward price bias

As there still is growth MFT's target price (TP) is increasing. If the shareprice lags behind the TP....use TA charts to time the entry to buy in.



** eps figures used differed slightly in various reference texts. The resulting PE ratios may be a couple of decimal points different depending on which reference one uses.



Disc:

Bought MFT July 2006 @ 593c
Sold 27 Aug 2007 @ 705c

The company is too good not to be on my watch list.

[scamper]

Thanks Hoop -- never really worked my way through an FA indicator with such clear points.
and, you ended up with my rule: use TA to time buys and sells, FA to pick the stock.
now, all i need to do, is follow my own rule...
Hi Gravy Train -- use the search button for posts by Phaedrus -- he outlines TA triggers with similar clarity. good luck!

[Viking]

Thank you Hoop, this is quite enlightening for me :)

[Rif-Raf]

Great analysis Hoop.

One thing you haven't mentioned is the change in the market conditions. while 11.6 looks high compared to their long run average of around 9.5, wouldn't it also be correct to suggest that the long run pe of the market is higher now than over the period you are looking at?
If the market pe is higher now by say 2-3 then perhaps the stock is undervalued.

Of course you could say the current market is overvalued or alternativey the historic market prices were undervalued, however what is a fair p/e for a market may also be heavily influenced such things as interest rates etc.

[Hoop]

Great analysis Hoop.

One thing you haven't mentioned is the change in the market conditions. while 11.6 looks high compared to their long run average of around 9.5, wouldn't it also be correct to suggest that the long run pe of the market is higher now than over the period you are looking at?
If the market pe is higher now by say 2-3 then perhaps the stock is undervalued.

Of course you could say the current market is overvalued or alternativey the historic market prices were undervalued, however what is a fair p/e for a market may also be heavily influenced such things as interest rates etc.

Thanks Guys. Rif Raf yes a higher market PE may influence the PE of a company, I know a lower market PE does affect a company PE ,the Asian crises was proof to that.
I would say that there are many mathematical equations floating around accessing the short term company values in relation with it's market, however when it gets too complicated I give up :) that is why I tend to be a long term investor by nature, its easier.

I have noticed that an overall PE for a market has its "norms" as well.... may work on one for the NZX one rainy day.
I think I read somewhere that the Hang Seng has an average PE of over 26, this may seem high in relation to NZX but they have high growth so is that market overpriced? maybe not.

[Rif-Raf]

I think you'll find that the average pe for NZ companies was extremely low through the 90's compared to overseas bourses. This is because the NZX was hit so hard in the '87 crash that it took many years to properly recover lost market confidence. In short the NZ market went from one xtreme to the other. Only in the last 3-4 years have we actually properly caught up and in some cases overtaken others in terms of valuing companies without applying a discount (because it is an NZX company).

I guess what I'm saying is that if MFT was trading at a PE of around 10 in the late 90's when perhaps the market pe was averaging say 12, then as the market pe is now possibly around 15, then all other things equal MFT should be at say 13.
I'm just guessing these numbers to illustrate the point. At a pe of 11.6 I wouldn't be losing too much sleep if I owned this stock.

[Snow Leopard]

You all seem to be basing the current PE for good old Mainfreight on last years total profit of $55m6. However that included a significant abnormal (one-off) gains of $19m2 mainly from the sale of the Hirepool stake.
Mainfreight themselves were very keen to make this clear in their results announcment (http://stocknessmonster.com/news-item?S=MFT&E=NZSE&N=148365).
So a better EPS to work with would be the 41.1 from continuing operations which at todays close equates to a PE of 16.4. [Note this is based on NPAT under GAAP]

Further more in the first quarter of this year we have a nice little abnormal of $61m2 from the sale of LEP and Pan Orient.

So the headline end of year profit for the 2008 year should be north of $100m0, but the profit from the every day business of logistics and stuff is very likely to be less than of this headline figure and the forward PE is possibly 15.

This in my book means MFT is currently fairly priced.

best wishes
Paper Tiger

[gravy train]

Thanks to all for the views & pointers.

While I'd read the annual report enough to share Paper Tigers view of a current PE of 16.4, I wasn't aware of the Pan Orient Abnormal (thanks PT), I hadn't considered the natural PE range (thanks Hoop), or the market PE (thanks Rif-Raf), or in fact using (proper) TA to time my buy (thanks scamper).

All good things to be aware of I'm sure, as I find an investment approach that works for / suits me.

Again, as I'm looking to learn by doing - with training wheels on (exit strategies), and greatly appreciate the input from the experienced.

I guess time will tell for MFT.

Cheers
GT