HGH - Heartland Group Holdings

[percy]

Good one

So Kerry was really saying rainy day money in the bottom drawer should really be in shareholders pockets .....hmmmmm

You may well think that.
However, I would think Kerry would rather have had it in his pocket.!..lol.

[winner69]

https://www.heartland.co.nz/Uploads/Documents%20and%20Forms/Heartland%20Account%20Application%20Form%20-%20Individuals.pdf

I decided I've had enough of the "so called" Bank of New Zealand with their pitiful 0.1% on call accounts....so I finally got around to doing something about it. Was pain free, took me less than 10 minutes at home to fill out the forms and get copies of relevant identification documents. Heartland staff at Newmarket were very courteous, professional and friendly and all done in less than 10 minutes there. Heartland will be happy to pay you 2.75% at call. Ideal for those that want full flexibility with their finances and a fair return on call.

Jeez, you went to a branch. Naughty dog, they wantbyounto do digital things.

Mind you I opened account up in person at a branch finding it easier than doing things digitally.

Because their 'digital systems' are so crap easier to ring a real person to do term deposit thingies

Maybe they need to revert back to being a people's bank with personal service

Looking forward to the day when they insist I self declare under FACTA or whatever it is - what a minefield if ANZ is anything to go by.

[mfd]

I was very pleased with their term deposit process - send a message with term, deposit, interest payment and maturity preferences etc via messaging in online banking, accounts setup the next day and backdated to the day I applied (at about 5:30). 5 minute job to open a new term deposit and PIE.

[trader_jackson]

share price going down today... we need to start talking more, that should make the price smash through the $1.80 mark...

I'll re-kick things off: winner, 60.1m is far to conservative, surely 61 minimum...

[suse]

I had a bit of a problem getting my internet banking sorted out when I opened an account, (I suspect it was because they had just had a big IT change) but it's amazing if you copy Jeff into an email how quickly things get sorted :)

Happy to be getting a pile more interest with HBL than I was at ANZ. Looking forward to seeing the SP go to $2. '

Happy holder.

[Beagle]

Jeez, you went to a branch. Naughty dog, they wantbyounto do digital things.

Mind you I opened account up in person at a branch finding it easier than doing things digitally.

Because their 'digital systems' are so crap easier to ring a real person to do term deposit thingies

Maybe they need to revert back to being a people's bank with personal service

Looking forward to the day when they insist I self declare under FACTA or whatever it is - what a minefield if ANZ is anything to go by.

Thought it would be a good opportunity to see what the staff are like and see how professional they were.

[ziggy415]

share price going down today... we need to start talking more, that should make the price smash through the $1.80 mark...

I'll re-kick things off: winner, 60.1m is far to conservative, surely 61 minimum...
Too much talking...everytime winner makes his predictions, bang, down it goes...happened with1.60...1.80 and now 2.00:p

[pierre]

Jeez, you went to a branch. Naughty dog, they wantbyounto do digital things.

Mind you I opened account up in person at a branch finding it easier than doing things digitally.

Because their 'digital systems' are so crap easier to ring a real person to do term deposit thingies

Maybe they need to revert back to being a people's bank with personal service

Looking forward to the day when they insist I self declare under FACTA or whatever it is - what a minefield if ANZ is anything to go by.

I've just had to complete a declaration to RaboDirect (my company uses them) to prove who I am. I've only been using the account for the past five years but the law requires me to go through the whole palaver once again. What a pain in the arse this whole AML law is.

Feel sorry for the people at the banks (all of them) who probably cop it in the neck from customers each time.

[winner69]

I've just had to complete a declaration to RaboDirect (my company uses them) to prove who I am. I've only been using the account for the past five years but the law requires me to go through the whole palaver once again. What a pain in the arse this whole AML law is.

Feel sorry for the people at the banks (all of them) who probably cop it in the neck from customers each time.

That Rabo thing is just the start

Wait until you get into FATCA - column here is a good overview
http://www.chrislee.co.nz/market-news


The ANZ form for a trust is 5 pages long with reference to that 92 page IRD document. Goodness knows what it's going to be like for a company.

[winner69]

Too much talking...everytime winner makes his predictions, bang, down it goes...happened with1.60...1.80 and now 2.00:p

Remember when it was 140 odd two and a half years ago (Feb 2015)

I said 200 then ......and it went down to about 110 (and some backed the truck up eh)

I'll get it right one day - still say over 200 by end of August

See dairy prices up over night - that's good.

[Brain]

I remember when these were 76 c in March 2013. Heartland has been a very good investment for me and I am hopeful that it will continue to be so.

[Beagle]

Why its worth more.
1. We cannot ignore the fact that HBL has grown its EPS faster in recent years than the Aussie banks.
2. This trend is set to continue, see below therefore a PE premium is warranted compared to its peer group.
3. The following are the forecast PE's for its peer group for FY17, FY18 and FY19 followed by average analyst expected EPS growth in percentage terms bolded from FY17 to FY19 All data off average analysis forecast off 4 traders
Bendigo BEN 13.2, 13.1, 13.3, EPS growth expected -1%
NAB 13.6, 13.4, 13 4%
WBC 14.5, 14, 13.6 6%
ANZ 13.4, 13.2 12.5 7%
Bank of Queensland BOQ 12.9, 12.6 12.3 4.5%
HBL 13.8 12.6 11.9 14%

The average FY19 PE which takes into account average forecasted growth to FY19 is 12.77

4. Even if you make the case, (which I don't) that HBL will only enjoy two more years of abnormal growth before reverting to the very modest rates the Australian banks are "enjoying" for HBL to be trading at the average of its peer group the SP is likely to outperform its peer group by 12.77 / 11.9 = 7.3% over the next two years.

5. Even now based on average estimated 2017 earnings the peer group is trading at an average PE of 13.56 and HBL at 13.8 represents only a tiny premium which taking into account its historical growth outperformance and projected stronger growth and I think the current market PE premium is not properly recognizing this superior growth.

6. I think given the distinct possibility that HBL's growth will continue to outperform its peers post FY19 I think that a minimum further 7.3% rerating will happen over the foreseeable future, probably this year.

7. Relative to its peer group I therefore value HBL at 1.64 + 7.3% = $1.76.

8. I think you can easily make the case that relative to its peer group given its considerably stronger historical and projected growth a PE premium of 1 on FY17 projected earnings is warranted.
Average FY 17 PE for Aussie banks excl HBL is 13.52.
HBL's current PE 13.8 HBL should be trading on a FY17 PE premium of at least 1 = 14.52 14.52 / 13.8 = 5.2% increase from here = $1.73

9. Investment case summary: I therefore think fair value for HBL is between $1.73 and $1.76 on an ex dividend basis and note it currently trades on a theoretical ex dividend price of $1.60.5 ($1.64- 0.035) so we have another ~ 10% rerating to go and then from there the price should continue to drift up in line with the 14% earnings growth to FY 19. My 2 year target price is therefore 1.76 x 1.14 = $2.01 and in the meantime based on 8.5 cps in annual fully imputed dividends we will be enjoying a gross dividend yield of 7.36% (8.5 / 160.5) / 0.72.
Disc: Hold and fully subscribed to dividend reinvestment plan. Beagle posted 20 March 2017. SP has tracked in line with my expectations and I continue to believe its a $2.00 stock but the question is when ? In this post I called it as $2.00 in two years time (March 2019), and I am inclined toward sticking with that point of view but will have another look at this after the annual result announcement and update my thinking.

[winner69]

Beagle posted 20 March 2017. SP has tracked in line with my expectations and I continue to believe its a $2.00 stock but the question is when ? In this post I called it as $2.00 in two years time (March 2019), and I am inclined toward sticking with that point of view but will have another look at this after the annual result announcement and update my thinking.

No - will go over $2 end of August when Jeff says F18 will be $66m to $70m

Yippee

[percy]

No - will go over $2 end of August when Jeff says F18 will be $66m to $70m

Yippee

We are "well positioned."
I note www.4-traders have $60.1 mil for 2017 ,$67.5mil for 2018, and $71.9mil for 2019.
Therefore, we await with Jeff's figure, with a sense of heightened arousal.

[Beagle]

No - will go over $2 end of August when Jeff says F18 will be $66m to $70m

Yippee
I love your enthusiasm mate :t_up:


We are "well positioned."

Goes for your well positioned comment too mate...like a daily morning coffee, need a pick up sometimes :)

I am however a little more cautious than you well regarded gentlemen. On a trailing PE now of over 15 we will indeed need some good solid guidance for FY18 to get over the 2 hurdle. Great hold in the meantime, couldn't agree more with that sentiment.

[percy]

I love your enthusiasm mate :t_up:



Goes for your well positioned comment too mate...like a daily morning coffee, need a pick up sometimes :)

I am however a little more cautious than you well regarded gentlemen. On a trailing PE now of over 15 we will indeed need some good solid guidance for FY18 to get over the 2 hurdle. Great hold in the meantime, couldn't agree more with that sentiment.

$2.00 this year,next year or the year after.???
Does not really matter to me,as all the time I am enjoying the increasing dividends.
www.4-traders.com..... 2017 ..8.87 cents per share ..2018.. 9.6 cps......2019..10.2cps.ie a steady 7% increase per year.

[Beagle]

$2.00 this year,next year or the year after.???
Does not really matter to me,as all the time I am enjoying the increasing dividends.
www.4-traders.com..... 2017 ..8.87 cents per share ..2018.. 9.6 cps......2019..10.2cps.ie a steady 7% increase per year.

Fair comment mate and no argument from me, I'm enjoying them too. $67.5m for FY8 gives 13.07 cps. At $1.79 that puts HBL on a 2018 PE of 13.7. SP seems fair and reasonable to me at the current level, a good hold for excellent fully imputed dividend yield and steadily increasing earnings and dividends. Based on average broker forecast for FY18 HBL provides a gross dividend yield inclusive of full imputation credits of 7.45% at $1.79 and in addition trades cum a circa 5 cps dividend due soon after the forthcoming annual result. This together with dividend growth going forward makes for a very sound case for a long term hold, in my opinion.

[iceman]

$2.00 this year,next year or the year after.???
Does not really matter to me,as all the time I am enjoying the increasing dividends.
www.4-traders.com..... 2017 ..8.87 cents per share ..2018.. 9.6 cps......2019..10.2cps.ie a steady 7% increase per year.

And that's what it is all about. Steady increases in profits, ROE and dividends. 9 months announcement confirmed 11-13% growth so clearly we will continue receiving increased dividends. As you said, the SP matters not so much on a short term basis while the business successfully motors ahead

[ziggy415]

Bank of America Corp. (https://www.bloomberg.com/quote/BAC:US) has told investment bankers to stop working on transactions with HNA Group Co. for now amid growing concerns about the acquisitive Chinese conglomerate’s debt levels and ownership structure, according to people familiar with the matter.
The U.S. investment bank joins other Wall Street firms, including Citigroup Inc. and Morgan Stanley, that are largely steering clear of advising and financing the group on deals (https://www.bloomberg.com/quote/HNAGRZ:CH) because they are unable to get internal approvals from “know your customer” committees, the people said, asking not to be identified because the information is private.
Udc finance buyers

[Beagle]

And that's what it is all about. Steady increases in profits, ROE and dividends. 9 months announcement confirmed 11-13% growth so clearly we will continue receiving increased dividends. As you said, the SP matters not so much on a short term basis while the business successfully motors ahead

$1.80 got cleaned out today...for what its worth I helped in that process. That's what happens when a silly dog talks himself into buying more as per post #9536.
PE seems very reasonable for the steady growth of HBL.

[Baa_Baa]

$1.80 got cleaned out today...for what its worth I helped in that process. That's what happens when a silly dog talks himself into buying more as per post #9536.
PE seems very reasonable for the steady growth of HBL.

Do you wonder why you sold thereabouts 1.30 if I recall correctly then missed the divis and the .50 cap upside? Summer 2014/15 was a ramping doozy, then the diary crisis a down ramping doozy, that wasn't sustained. We need to be careful of the devil on one shoulder while the angel on the other is saying something else but we've stopped listening to the bright side.

[Beagle]

Do you wonder why you sold thereabouts 1.30 if I recall correctly then missed the divis and the .50 cap upside? Summer 2014/15 was a ramping doozy, then the diary crisis a down ramping doozy, that wasn't sustained. We need to be careful of the devil on one shoulder while the angel on the other is saying something else but we've stopped listening to the bright side. I sat out just over two years of the dairy crisis that was an extremely risky period of time for the N.Z. banking industry. The dairy collapse was a cancer that could have very seriously impacted the N.Z. banking sector. By taking a carefully measured approach to exposing myself to risk in this sector I missed just on only 15 cents in the rise from 85 cps when I first invested after the credit rating upgrade to the current price of $1.80. $1.32 - $1.47 was all I missed, yesterday's top up was just that. FYI I made more than the return I missed in this sector while invested in other sectors. Risk mitigation is an essential approach to any investment strategy in my opinion. Things could have gone terribly wrong for HBL and all other banks exposed to the dairy sector but thankfully they all dodged a bullet and we are now onward and upward again.
As posted above with a forward estimated PE in the mid 13's for FY18 taking into account the excellent fully imputed dividend yield, the forecast growth in EPS and dividends I think the forward PE on a risk adjusted basis, (yes pretty benign trading conditions now) is fair - good value.

[winner69]

Beagle - I think it's good that you can change your view as circumstances change. A good attribute you have even if the eyes of some it makes you appear to be a bit flighty but thats their problem I reckon

You might even see FBU as a good punt one day

[Beagle]

Beagle - I think it's good that you can change your view as circumstances change. A good attribute you have even if the eyes of some it makes you appear to be a bit flighty but thats their problem I reckon

You might even see FBU as a good punt one day

Thanks Winner I think one is sometimes best to take an adaptive and nimble approach, especially with stocks like PPH ! but please don't hold your breath on FBU :)

[Beagle]

New all time high of $1.82...Percy would you like to do the honours and complete this phrase that I "vaguely" remember. We are well .......... ? :)

[percy]

New all time high of $1.82...Percy would you like to do the honours and complete this phrase that I "vaguely" remember. We are well .......... ? :)

It may have been well....... "positioned" ,"poised" for another good result, which Peat would possibly comment, that "the fragance [of growth] is becoming stonger."
A lot of runs now on the board.

[Under Surveillance]

It may have been well....... "positioned" ,"poised" for another good result, which Peat would possibly comment, that "the fragance [of growth] is becoming stonger."
A lot of runs now on the board.
Spare a thought for Snoopy, who bagged HBL all the way down to 43. While some discern pleasant fragrances, he is probably still overwhelmed by foul odours.

[percy]

Spare a thought for Snoopy, who bagged HBL all the way down to 43. While some discern pleasant fragrances, he is probably still overwhelmed by foul odours.

While all the time praising ARI [asx] from 38 cents to .000000000.
Och..!

[Snoopy]

Spare a thought for Snoopy, who bagged HBL all the way down to 43. While some discern pleasant fragrances, he is probably still overwhelmed by foul odours.



While all the time praising ARI [asx] from 38 cents to .000000000.
Och..!

A hindsight view of history decouples the period risk factors from what was has happened to the share price since.

For those who have forgotten, there were serious problems with the 'non-core' (sic) property portfolio at the time Heartland was at 43c. It wasn't just management skill that got HBL out of their difficulties either. Sometimes when a company gets into trouble you bet and win. Other times you bet and lose (as happened to me with Arrium). At the time of any investment, the final result is not determined.

I am happy with the risk I took in upping my Arrium shareholding at the time, although I am obviously not happy with the hindsight result. No doubt many here are happy with the risk they took in investing in Heartland. Good on those who have done well in Heartland. We need risk taking investors as well as boring investors. But don't let the rise in share price from 43c to '$1.80 odd' blind anyone that the ride was not a little bumpy along the way. And don't think the share price going up on no news means your investment risk is getting lower, when in actual fact the contrary is true.

SNOOPY

[Snow Leopard]

A hindsight view of history decouples the period risk factors from what was has happened to the share price since.

For those who have forgotten, there were serious problems with the 'non-core' (sic) property portfolio at the time Heartland was at 43c. It wasn't just management skill that got HBL out of their difficulties either. Sometimes when a company gets into trouble you bet and win. Other times you bet and lose (as happened to me with Arrium). At the time of any investment, the final result is not determined.

I am happy with the risk I took in upping my Arrium shareholding at the time, although I am obviously not happy with the hindsight result. No doubt many here are happy with the risk they took in investing in Heartland. Good on those who have done well in Heartland. We need risk taking investors as well as boring investors. But don't let the rise in share price from 43c to '$1.80 odd' blind anyone that the ride was not a little bumpy along the way. And don't think the share price going up on no news means your investment risk is getting lower, when in actual fact the contrary is true.

SNOOPY

One does have to wonder at the current share price given the consensus earnings forecasts for the next few years.

Surely, one can say that, currently, it is fundamentally 'over-priced' using any sensible metrics.

Best Wishes
Paper Tiger

[ziggy415]

Wonder if HNA group have got funding in place for there buy of udc finance seeing as their funding lines are getting tighter

[percy]

Yes it is satisfying to see Heartland approaching NZ's greatest over priced shares.
Still some way to go I think?.

..........................PE................Yield. .........eps growth 1st year.....eps growth 2nd year.
AIA.....................28.98...........2.71%..... ..............7.5%.....................6.5%
EBO....................21.03...........3.42%...... .............9.49%...................5.8%
FPH.....................37...............1.76%.... ...............18%......................12.8%
FRE.....................22.28...........3.41%..... ..............3.5%.....................8%
MFT.....................23.56...........1.72%..... ..............11.4%...................13.3%
POT.....................39.44...........3.43%..... ...............7.3%.....................8.4%
HBL.....................15.94...........4.67%..... ...............8.2%.....................6.9%
NB HBL have a record of beating analysts eps growth figures.

[Snow Leopard]

Yes it is satisfying to see Heartland approaching NZ's greatest over priced shares.
Still some way to go I think?.

..........................PE................Yield. .........eps growth 1st year.....eps growth 2nd year.
AIA.....................28.98...........2.71%..... ..............7.5%.....................6.5%
EBO....................21.03...........3.42%...... .............9.49%...................5.8%
FPH.....................37...............1.76%.... ...............18%......................12.8%
FRE.....................22.28...........3.41%..... ..............3.5%.....................8%
MFT.....................23.56...........1.72%..... ..............11.4%...................13.3%
POT.....................39.44...........3.43%..... ...............7.3%.....................8.4%
HBL.....................15.94...........4.67%..... ...............8.2%.....................6.9%
NB HBL have a record of beating analysts eps growth figures.

Yes EBO - there is another over-priced share for you.

That and HBL make up over 30% of my NZX portfolio.

Best Wishes
Paper Tiger

[janner]

Yes it is satisfying to see Heartland approaching NZ's greatest over priced shares.
Still some way to go I think?.

..........................PE................Yield. .........eps growth 1st year.....eps growth 2nd year.
AIA.....................28.98...........2.71%..... ..............7.5%.....................6.5%
EBO....................21.03...........3.42%...... .............9.49%...................5.8%
FPH.....................37...............1.76%.... ...............18%......................12.8%
FRE.....................22.28...........3.41%..... ..............3.5%.....................8%
MFT.....................23.56...........1.72%..... ..............11.4%...................13.3%
POT.....................39.44...........3.43%..... ...............7.3%.....................8.4%
HBL.....................15.94...........4.67%..... ...............8.2%.....................6.9%
NB HBL have a record of beating analysts eps growth figures.

All very good perc..

However I think that I would prefer a slightly lower price.
The higher the price the lower the amount of shares via the DRP..

Love the DRP.. Compound interest and all that :-))

[percy]

Yes EBO - there is another over-priced share for you.

That and HBL make up over 30% of my NZX portfolio.

Best Wishes
Paper Tiger

What.........no POT.?...........PE is still under 40....!!!.................lol.

[percy]

All very good perc..

However I think that I would prefer a slightly lower price.
The higher the price the lower the amount of shares via the DRP..

Love the DRP.. Compound interest and all that :-))

I am happy either way.
Heads we win,Tails we win.!!.......You could say we are "well positioned,"and I would agree with you...lol

[winner69]

While all the time praising ARI [asx] from 38 cents to .000000000.
Och..!

So its bag Snoopy season again - most unfair and below the belt stuff .....are you guys so superior?

Complacency and the mood of 'nothing can go wrong' is a sure sign of a market top (or stock specific) before the crash.

What do they say - pride comes before the fall.

[kizame]

So its bag Snoopy season again - most unfair and below the belt stuff .....are you guys so superior?

Complacency and the mood of 'nothing can go wrong' is a sure sign of a market top (or stock specific) before the crash.

What do they say - pride comes before the fall.

Wow very good post! Yep humble pie can be eaten by all of us.

[percy]

Wow very good post! Yep humble pie can be eaten by all of us.

I have always owned up to my mistakes very quickly on Sharetrader.
I have always been honest with all my posts.
It is a fact I do not bet or gamble on stocks.
I do a great deal of research BEFORE I buy into a stock,and only buy more of that stock, if my research gets proved to be correct.ie Companies do what they will do.
The more research I do the better the results I get.
I make few mistakes.
My post #14 on 02-10-2014 on ASX thread ARI [Arrium] I did say "I would be very careful with your NTA." A warning foolishly ignored as were other posters warnings.

[kizame]

I have always owned up to my mistakes very quickly on Sharetrader.
I have always been honest with all my posts.
It is a fact I do not bet or gamble on stocks.
I do a great deal of research BEFORE I buy into a stock,and only buy more of that stock, if my research gets proved to be correct.ie Companies do what they will do.
The more research I do the better the results I get.
I make few mistakes.
My post #14 on 02-10-2014 on ASX thread ARI [Arrium] I did say "I would be very careful with your NTA." A warning foolishly ignored as were other posters warnings.

Percy that was not particularly directed at you,the main gist was I liked the post and that we all need to be pretty humble in this game as anything can happen,I am no angel and nothing a good dose of the pie doesn't fix.

[percy]

Some great "Winston" quotes in Scoop Business article headed ;UDC Finance's Chinese sale built on a house of Renminbi.
"The parlous state of proposed UDC Finance purchaser China's HNA Group,means the Overseas Investment Office should reject its application forthwith."
"HNA owes so much money that its interest payments exceed revenue."

[percy]

If Carl Boberg was still alive today he could have found inspiration on here to come up with another great poem

Be nothing compared to our Winston's quotes.

[iceman]

Some great "Winston" quotes in Scoop Business article headed ;UDC Finance's Chinese sale built on a house of Renminbi.
"The parlous state of proposed UDC Finance purchaser China's HNA Group,means the Overseas Investment Office should reject its application forthwith."
"HNA owes so much money that its interest payments exceed revenue."

The more one reads about the pressure HNA Group and a couple of other large Chiese companies that have gone on huge overseas sending sprees are coming under from the Chinese authorities point towards this deal not going through. Should the deal not be completed, it will be very interesting to see what will happen with UDC.

[Joshuatree]

That is one interesting piece of news, thanks.Heartland to pick up the pieces a possibility?
"Oh lord its hard to be humble when you're percy in every way" ,:D couldn't resist it percy:p

[Joshuatree]

$50 billion shopping spree since 2015
Chinese conglomerate HNA Group reveals ownership structure (https://www.google.co.nz/url?sa=t&rct=j&q=&esrc=s&source=web&cd=4&ved=0ahUKEwiXv7ChnqnVAhXLx7wKHR4RCGEQFggyMAM&url=http%3A%2F%2Fwww.cnbc.com%2F2017%2F07%2F25%2Fc hinese-conglomerate-hna-group-reveals-ownership-structure.html&usg=AFQjCNFs_KoByLI09qGBFR8R4aplDW3etA)

[Beagle]

The more one reads about the pressure HNA Group and a couple of other large Chiese companies that have gone on huge overseas sending sprees are coming under from the Chinese authorities point towards this deal not going through. Should the deal not be completed, it will be very interesting to see what will happen with UDC.

If the sale doesn't go through I can't see ANZ giving it away mate, they're not desperate sellers and its a pretty big company for HBL to consider buying but I agree that we live in interesting times and we are of course, "well positioned" :)

[janner]

If the sale doesn't go through I can't see ANZ giving it away mate, they're not desperate sellers and its a pretty big company for HBL to consider buying but I agree that we live in interesting times and we are of course, "well positioned" :)

Agree with your statement " its a pretty big company " .. Also " we live in interesting times "..

Which I am sure most on here would know that as being an ancient Chinese curse..

Maybe better to be left well alone....

[percy]

It would be well worth HBL buying it.
HBL would need to raise a lot of capital to do it,but that would be well supported, because it makes sense.
HBL would not do the deal if ANZ were looking to get the same price HNA Group were looking to pay.
ANZ have stated they will sell UDC,so yes we live in interesting times.
All the time, we must remember Greenslade worked at UDC, and other HBL staff are ex UDC, so they know the UDC business .

[janner]

It would be well worth HBL buying it.
HBL would need to raise a lot of capital to do it,but that would be well supported, because it makes sense.
HBL would not do the deal if ANZ were looking to get the same price HNA Group were looking to pay.
ANZ have stated they will sell UDC,so yes we live in interesting times.
All the time, we must remember Greenslade worked at UDC, and other HBL staff are ex UDC, so they know the UDC business .


:-))))))))))

[Beagle]

Disc: BBB - Beagle busy buying.

[janner]

:-))))))))))

DYOR ... No.. Just wind percy up and you get all the info ... :-))))))

[Snoopy]

My post #14 on 02-10-2014 on ASX thread ARI [Arrium] I did say "I would be very careful with your NTA." A warning foolishly ignored as were other posters warnings.


I hesitate to reply to this post at the risk of going too far off topic. But I do want to say something about 'asset values' which applies to banks in general and Heartland being a financial institution.

A commodity asset that has 'earning power', has its value determined by the commodity price (and that includes the iron ore price or the milk price as examples). That asset will go up and down in value depending on the open market value of that commodity. If you borrow a lot of money when commodity prices peak to buy such an asset, then you are likely in for a hiding (i.e. the bank may want to repossess your asset and sell it off as the market plunges to allow recovery of the bank loan used to buy it) should the underlying commodity price fall. This means that if you buy into a 'commodity asset', be it a herd of cows or an iron ore deposit, you need to be aware of the likely fluctuations in the future of that commodity and the flow on effect that may have for your investment. If you guess the price path of your underlying commodity wrongly, then you can get cleaned out. If you guess right , then you can make big dollars while everyone else is running around like a headless chicken screaming the sky is falling.

The failure of my investment in Arrium was not because I guessed the iron ore price path wrongly. In fact shortly after receivership (receivership occurred while all loan payments had been made up to date and on time and when the company was in full compliance with their banking covenants) , the iron ore price recovered. IMO, with the support of the banks, Arrium could (should?) have traded out of its difficulties. The problem was that Arrium was tipped into receivership because the board thought that if the iron ore price stayed low, then the company would break its banking covenants. The receivership was triggered by a scenario that might have happened but never did. It turned out that the board was unnecessarily pessimistic in their iron ore price forecasts, but by then the die was cast. The board severely pissed off all of the big four banks in their banking syndicate (Rule 1 in business: you can get away with pissing off a banker, but not every banker in town). As a result no banker was prepared to refinance the company out of its (short term?) difficulties.

In short, buying Arrium shares at a price that looked like a too good to be true discount to asset backing was not the problem. The problem was that the humans at the top of each corporate tree lost respect for each other and went down a path that saw the banks lose a lot and Arrium shareholders lose everything. Endless studying of the NTA or other financial figures could never have predicted or saved shareholders from such an outcome. Arrium was a punt I lost. But it was at no time as reckless a punt as some on this forum seem to think.

SNOOPY

[percy]

Serious investors do not bet,gamble , take punts,or go on gut feelings.
As you have proved,with ARI it does not work.
Investment rules;
No.1.Do not loose capital.........Failed.
No2.Refer No,1.......................Failed.
No.3.Refer No.2......................Failed.

[iceman]

If the sale doesn't go through I can't see ANZ giving it away mate, they're not desperate sellers and its a pretty big company for HBL to consider buying but I agree that we live in interesting times and we are of course, "well positioned" :)

Agree. Didn't suggest HBL would by them, just that it will be interesting to see what happens. But it is a possibility :-)

[Joshuatree]

Serious investors do not bet,gamble , take punts,or go on gut feelings.
As you have proved,with ARI it does not work.
Investment rules;
No.1.Do not loose capital.........Failed.
No2.Refer No,1.......................Failed.
No.3.Refer No.2......................Failed.

"Oh Lord its hard to be humble when your'e percy in every way"

[Snoopy]

Serious investors do not bet, gamble , take punts, or go on gut feelings.


Actually serious investors do all of the above. No doubt Heartland goes through exactly a process like this when they draw up loan agreements with customers. With the rider that 'bet' 'gamble' or 'take a punt' is not akin to spinning the roulette wheel. Taking an investment bet is all about:

1/ looking at the possible outcomes. I usually simplify it down to an 'if it goes wrong scenario'. An 'if things carry on as usual scenario' and an 'if growth plans come to fruition scenario.'
2/ looking at the payoff of those outcomes in dollars. Let's call them D1, D2 and D3
3/ looking at the likelihood of these outcomes. Let's call the probability of each event 'p1, p2 and p3.

Then you do the sum:

(p1 x D1) + (p2 x D2) + (p3 x D3) =

And if you like the result (i.e. it comes out positive enough), you invest. Sometimes the actual result can come out negative, despite your best research. You can't be sure what will happen at the time you do invest. To claim you only invest in successful investments is just disingenuous.



As you have proved,with ARI it does not work.
Investment rules;
No.1.Do not lose capital.........Failed.
No2.Refer No,1.......................Failed.
No.3.Refer No.2......................Failed.


Investment results are not predetermined, and in general the result are not of binary importance (i.e whether you have 'a win' or 'a loss' is not important in itself). What matters is if the overall strategy works. While I am in broad agreement with your point Percy, I always manage my investments at a portfolio level. I have already recovered all of my Arrium losses on other investments. So overall I haven't lost any capital as you claim.

SNOOPY

[themadhatter]

Actually serious investors do all of the above. No doubt Heartland goes through exactly a process like this when they draw up loan agreements with customers. With the rider that 'bet' 'gamble' or 'take a punt' is not akin to spinning the roulette wheel. Taking an investment bet is all about:

1/ looking at the possible outcomes. I usually simplify it down to an 'if it goes wrong scenario'. An 'if things carry on as usual scenario' and an 'if growth plans come to fruition scenario.'
2/ looking at the payoff of those outcomes in dollars. Let's call them D1, D2 and D3
3/ looking at the likelihood of these outcomes. Let's call the probability of each event 'p1, p2 and p3.

Then you do the sum:

(p1 x D1) + (p2 x D2) + (p3 x D3) =

And if you like the result (i.e. it comes out positive enough), you invest. Sometimes the actual result can come out negative, despite your best research. You can't be sure what will happen at the time you do invest. To claim you only invest in successful investments is just disingenuous.

SNOOPY

Spot on. Thats 200-level finance learnings right there.

[percy]

Actually serious investors do all of the above. No doubt Heartland goes through exactly a process like this when they draw up loan agreements with customers. With the rider that 'bet' 'gamble' or 'take a punt' is not akin to spinning the roulette wheel. Taking an investment bet is all about:

1/ looking at the possible outcomes. I usually simplify it down to an 'if it goes wrong scenario'. An 'if things carry on as usual scenario' and an 'if growth plans come to fruition scenario.'
2/ looking at the payoff of those outcomes in dollars. Let's call them D1, D2 and D3
3/ looking at the likelihood of these outcomes. Let's call the probability of each event 'p1, p2 and p3.

Then you do the sum:

(p1 x D1) + (p2 x D2) + (p3 x D3) =

And if you like the result (i.e. it comes out positive enough), you invest. Sometimes the actual result can come out negative, despite your best research. You can't be sure what will happen at the time you do invest. To claim you only invest in successful investments is just disingenuous.



Investment results are not predetermined, and in general the result are not of binary importance (i.e whether you have 'a win' or 'a loss' is not important in itself). What matters is if the overall strategy works. While I am in broad agreement with your point Percy, I always manage my investments at a portfolio level. I have already recovered all of my Arrium losses on other investments. So overall I haven't lost any capital as you claim.

SNOOPY

Sounds a great theory.?
However my usual solid research meant the following.
1] Made heaps investing in HBL, and kept increasing my investment each time they added more runs to the board,
2] Did not loose any capital in ARI,because I did not buy any,as its chances of survival were slim.Left them to the punters.
So $10,000 punted in ARI is $10,000 of capital lost.Gone.!
The same $10,000 invested in HBL is worth well over $30,000 today.ie $30,000 difference.
So "solid: research has again beaten "theory."
No surprises there.!
NB. I did share my research with everyone here on Sharetrader.All the meetings I went to,all the presentations I attended,all the phone calls I made to HBL directors and management.
Did any of the percy HBL knockers do the same.? No, they relied on theory?.Tough.!
Did I get lucky? Funny, the more reasearch I do the luckier I get.

[Felonius]

You are wonderful Snoopy. I admire the way you respond to ongoing rudeness & put-downs by Percy and others without responding in kind.
Sharetrader provides the opportunity for followers to hear different points of view, and surely that is the nature of share-trading - one person makes a decision to sell whilst another is buying !

Your contributions to Sharetrader are appreciated by many.
Thank you.

[percy]

You are wonderful Snoopy. I admire the way you respond to ongoing rudeness & put-downs by Percy and others without responding in kind.
Sharetrader provides the opportunity for followers to hear different points of view, and surely that is the nature of share-trading - one person makes a decision to sell whilst another is buying !

Your contributions to Sharetrader are appreciated by many.
Thank you.

I am sure everone here on Sharetrader, who prefers fiction to non-fiction reading, would agree with you...lol.

l

[winner69]

I am sure everone here on Sharetrader, who prefers fiction to non-fiction reading, would agree with you...lol.

l

c'mon percy - some want you to cool it with your ongoing put downs of snoops

are you that awesome? oops forgot you are, sorry mate

[percy]

c'mon percy - some want you to cool it with your ongoing put downs of snoops

are you that awesome? oops forgot you are, sorry mate

Yes my record is pretty awesome.

[Joshuatree]

Must be some good Qtrlys coming out for percy.

:t_up:Images for scrooge mcduck diving into gold (https://www.google.co.nz/search?q=scrooge+mcduck+diving+into+gold&client=safari&rls=en&tbm=isch&tbo=u&source=univ&sa=X&ved=0ahUKEwjl15eBsrLVAhVFm5QKHR3GC70QsAQIJA&biw=1359&bih=789)

[Felonius]

Thanks Jtree,
We are all hoping for a share of Scrooge's loot.

[Ggcc]

He who laughs last laughs longest!! We can't tell what the future brings. I am a shareholder of this company, but keeping cautious is great after losing a substantial amount of money on Wynyard. Yes Wynyard was a speculative stock, but had I listened I could have saved myself thousands. Thanks both Snoopy and Percy.

[percy]

Thanks Jtree,
We are all hoping for a share of Scrooge's loot.

Steadily increasing loot.....Very nice.....
Being fully imputated is the icing on the cake...
Love icing...lol.

[Beagle]

Closed July at an all time record high of $1.82. Yippee ! My 2 cents is those that have done their research and due diligence and have held have received their just rewards and those that haven't understood or misconstrued the situation even taking into account all the valuable posts and insights shared on here have missed out so the principle's of natural justice have played out fairly nicely in my view. All posters views are valuable and no need to squabble, all seems a fair and reasonable outcome to me.

P.S. Sometimes, and this is a good example in my opinion, its refreshing to have a new page for a thread.

[Baa_Baa]

Closed July at an all time record high of $1.82. Yippee ! My 2 cents is those that have done their research and due diligence and have held have received their just rewards and those that haven't understood or misconstrued the situation even taking into account all the valuable posts and insights shared on here have missed out so the principle's of natural justice have played out fairly nicely in my view. All posters views are valuable and no need to squabble, all seems a fair and reasonable outcome to me.

P.S. Sometimes, and this is a good example in my opinion, its refreshing to have a new page for a thread.

Some simple TA and active capital management has done a great deal better than acting on three years of conflicting views here.

Trouble is that frequent posters, be they advocates or detractors never post in real-time what they're actually doing on the market. So while it is helpful and interesting to hear various views, this place is no help for the hapless and often unhelpful synthesising all those messages into a coherent trading strategy.

At the end of the day it's all down to individual choice, and the chatter here is interesting and informative, but it is no substitute for ones own research and taking personal responsibility for their trading or investment decisions.

Tomorrow there could be world war three, or a global fiscal calamity and all the blow hard up themselves commentators on numerous share threads will be proven inept unless they sell, which if they do they won't disclose here for weeks or months later, because it takes time to formulate a contrary reason for buying or holding, then for selling when for months or years one has been an advocate pumping the stock.

Lots of reputation goes down the toilet quickly when the smelly stuff hits the fan and all the big mouths simultaneously stop talking, until they figure it out and come back with their bravery stories that saved them from certain fiscal death.

Or it could all romp on in benign economic circumstances and make the noisy few look like gurus, for the meantime.

The further away from the last painful experience that we get, the more emboldened and self assured we become, until one day when we least expect it we experience and have to re-learn the lessons that we thought we had learnt a long time ago.

Two-bit finance companies dressed up in banking drag will be not only the first to be slaughtered, they will also be the deepest cut.

Heartland is a great share right now, sort of like the pied piper with many happy followers. It is however also best owned by those who have the skills to move very very quickly when circumstances change, which they inevitably will regardless of the underlying FA.

[percy]

Six years.
This thread was started on 01-06-2011.And was the follow on from BSH thread.
I also agree with your comments,and feel they are appropriate for all list companies,and all sharemarkets.
As Warren Buffett said :"Only when the tide goes out do you discover who's been swimming naked."

[winner69]

Some simple TA and active capital management has done a great deal better than acting on three years of conflicting views here.

Trouble is that frequent posters, be they advocates or detractors never post in real-time what they're actually doing on the market. So while it is helpful and interesting to hear various views, this place is no help for the hapless and often unhelpful synthesising all those messages into a coherent trading strategy.

At the end of the day it's all down to individual choice, and the chatter here is interesting and informative, but it is no substitute for ones own research and taking personal responsibility for their trading or investment decisions.

Tomorrow there could be world war three, or a global fiscal calamity and all the blow hard up themselves commentators on numerous share threads will be proven inept unless they sell, which if they do they won't disclose here for weeks or months later, because it takes time to formulate a contrary reason for buying or holding, then for selling when for months or years one has been an advocate pumping the stock.

Lots of reputation goes down the toilet quickly when the smelly stuff hits the fan and all the big mouths simultaneously stop talking, until they figure it out and come back with their bravery stories that saved them from certain fiscal death.

Or it could all romp on in benign economic circumstances and make the noisy few look like gurus, for the meantime.

The further away from the last painful experience that we get, the more emboldened and self assured we become, until one day when we least expect it we experience and have to re-learn the lessons that we thought we had learnt a long time ago.

Two-bit finance companies dressed up in banking drag will be not only the first to be slaughtered, they will also be the deepest cut.

Heartland is a great share right now, sort of like the pied piper with many happy followers. It is however also best owned by those who have the skills to move very very quickly when circumstances change, which they inevitably will regardless of the underlying FA.

Awesome post baa_baa ....sort of agree




awesome is the word of the day today

[Beagle]

Baa Baa The thrust of your post is to suggest risk is everywhere and anything can happen and you allude to the fact that HBL is a two bit finance company dressed up as a bank.
I agree with the first assertion which is why I take an active approach to risk mitigation and am prepared to sit out (permanently or for years) from holding a stock in times of high risk, (sat out the dairy crisis for over 2 years on this stock for example).

I disagree strongly with the two bit finance company comment. Their capital ratio to the best of my knowledge is superior to all the Australian banks and I think you'll find that those grannies and orphans who continue to predominantly invest in term deposits are taking FAR more risk than they realise with the RBNZ's powers under the open banking resolution. They could easily get a haircut of 30-40% or even more in the event of a major exogenous shock to the banking system.

You infer that the Australian banks would be much stronger in a tremendous shock situation. I suggest you consider the state of the Australian and New Zealand housing markets and mining companies in Australia and look at the capital ratio of those banks. Just as much risk there as in any other bank in my opinion and on a skinnier capital base.

As Percy quite correctly alluded too yesterday, the N.Z. imputation system and no meaningful imputation credits on Australian banks makes HBL a compelling investment in this sector for Kiwi's as does its superior earnings growth rate.

P.S. Some posters post in real time what they're doing some of the time, for example I posted the other day I was BBB (Beagle busy buying) HBL in real time while I was doing it.

[percy]

A year or two ago I pointed out Australian banks faced the following issues which Heartland Bank did not.
Potential wholesale funding.
Slow down in mining.
Slow down in manufacturing particulary the motor assembly sector.
Slow down in retail,with many small towns seeing store closures.
Over exposure to housing market,both in Australia and NZ.
Large exposure to NZ dairying.
Issues closing unprofitable branches.
Need for more capital that would slow down eps growth.
I pointed out Heartland Bank faced none of these issues.
I therefore would think the Australian banks may be best left to Australian investors.

[Beagle]

I therefore would think the Australian banks may be best left to Australian investors. agree and note Australian investors are able to take advantage of Australian franking credits while generally Kiwi's cannot.

[percy]

agree and note Australian investors are able to take advantage of Australian franking credits while generally Kiwi's cannot.

And that really shows us the Australian attitude to New Zealanders.

[Joshuatree]

Yes John key accepting his award from Aus is an insult to us all.

[Bjauck]

And that really shows us the Australian attitude to New Zealanders.
Australia offers NZers a special category visa. An easy entry option that it gives to no other country. Nobody forces Kiwis to go to Oz on those terms.

When unemployment is is high in NZ, I wonder how many governments have been pleased to have the backdoor to Oz? Why shouldn't the NZ govt contribute to social welfare needs of Special category visa Kiwis in Oz?

[percy]

Australia offers NZers a special category visa. An easy entry option that it gives to no other country. Nobody forces Kiwis to go to Oz on those terms.

Yet NZ offers Australians better terms.
In fact we welcome them.
Fairer terms with imputation credits and fairer terms on welfare,including retirement super.
We also accept Australian professional qualifications.
Only time we screw them is on the Rugby field.

[Beagle]

Yet NZ offers Australians better terms.
In fact we welcome them.
Fairer terms with imputation credits and fairer terms on welfare,including retirement super.
Only time we screw them is on the Rugby field.

Agree...many of their policies are now iniquitous and the spirit of so called closer economic relations is adhered too in a most disingenuous manner in many respects.
Wish the N.Z. pollies would grow a spine and do something about it but in the meantime I am doing what I can and shifting most of my banking business to the TRUE Bank of New Zealand, Heartland.

[Bjauck]

Yet NZ offers Australians better terms.
In fact we welcome them.
Fairer terms with imputation credits and fairer terms on welfare,including retirement super.
Only time we screw them is on the Rugby field.

I didn't say Oz treated Kiwis as well as we treat Aussies!

Nz needs Australian commercial investment more than vice-versa. (Kiwis put so much of their money into housing!)

Many more Kiwis go to Australia than vice-versa (Although recently it has been more equal) and for kiwi politicians Oz can act as a valve when policies Fail! .

[Bjauck]

N.Z. pollies would grow a spine and do something about it but in the meantime I am doing what I can and shifting most of my banking business to the TRUE Bank of New Zealand, Heartland.
There are so many things too that the pollies should do for the Kiwis who have stayed in NZ!
I have now moved half of my business to HBL too. The new website is a nightmare though, although I find the phonebanking staff helpful.

[percy]

I didn't say Oz treated Kiwis as well as we treat Aussies!



Many more Kiwis go to Australia than vice-versa (Although recently it has been more equal) and for kiwi politicians Oz can act as a valve when policies Fail! .

Recent history has been the other way round.with Aussie politicians showing their short sightedness..

[Beagle]

There are so many things too that the pollies should do for the Kiwis who have stayed in NZ!
I have now moved half of my business to HBL too. The new website is a nightmare though, although I find the phonebanking staff helpful.

I have been with the so called Bank of New Zealand for nearly 40 years so its a HUGE step for a creature of habit hound to make this change but its my way of pushing back against the Australian's and their banking empire which strips billions of dollars of profits from the N.Z. economy every year.

[macduffy]

And that really shows us the Australian attitude to New Zealanders.

To be fair, percy, it works the other way around too. Australian investors can't take advantage of NZ imputation credits - not that they (probably) don't hold many NZ equities.

[winner69]

Back on topic - Heartland holding over 180 and still on track for 2 bucks by end of month after the $70m guidance for F18 comes out

Awesome stuff

[Bjauck]

I have been with the so called Bank of New Zealand for nearly 40 years so its a HUGE step for a creature of habit hound to make this change but its my way of pushing back against the Australian's and their banking empire which strips billions of dollars of profits from the N.Z. economy every year. I used to be happily with the the National Bank of NZ, when it was riding the Lloyds horse, before it was subsumed by ANZ. The designs and colour schemes of Heartland seem familiar and comforting!

[Beagle]

Back on topic - Heartland holding over 180 and still on track for 2 bucks by end of month after the $70m guidance for F18 comes out

Awesome stuff

Now that Kiwisaver is well and truly into full swing there's new money coming to the market every single month that needs to find a home somewhere and where better than a bank with solid growth !

[winner69]

Now that Kiwisaver is well and truly into full swing there's new money coming to the market every single month that needs to find a home somewhere and where better than a bank with solid growth !

You're awesome mate - good thinking

[Food4Thought]

You're awesome mate - good thinking

I💙HBL ...caps, shirts, mugs and bumper stickers...

[trader_jackson]

https://nzx.com/companies/HBL/announcements/304880

No upgrade? (again)
Hmm must be good, but too good

[winner69]

https://nzx.com/companies/HBL/announcements/304880

No upgrade? (again)
Hmm must be good, but too good

awesome eh ....keeping heaps in the bottom drawer for a rainy day

[pierre]

I used to be happily with the the National Bank of NZ, when it was riding the Lloyds horse, before it was subsumed by ANZ. The designs and colour schemes of Heartland seem familiar and comforting!

Yes all good - apart from HBL's bloody abominable new web site.

ANZ adopted much of the National Bank's technology platform and they have a great web site that's so easy to navigate. Pity HBL didn't study their site before heading down the tunnels and mazes they've created in their current nightmare. I've commented on this before but even their staff find it horrendous. One staffer told me it took him months to get his head around it - and he uses it every day. I have to use it occasionally for business purposes - and I dread going near it every time.

[janner]

https://nzx.com/companies/HBL/announcements/304880

No upgrade? (again)
Hmm must be good, but too good

I am happy not to have an upgrade.. Just keep the price low for the DRP..

Bottom drawer ???.. Not for me.. Top shelf... :-)))))

[Bjauck]

Yes all good - apart from HBL's bloody abominable new web site. .. I agree. The old site was not the best but easier to navigate than the latest incarnation.

[winner69]

Yes all good - apart from HBL's bloody abominable new web site.

ANZ adopted much of the National Bank's technology platform and they have a great web site that's so easy to navigate. Pity HBL didn't study their site before heading down the tunnels and mazes they've created in their current nightmare. I've commented on this before but even their staff find it horrendous. One staffer told me it took him months to get his head around it - and he uses it every day. I have to use it occasionally for business purposes - and I dread going near it every time.

Heartland leaders in the digital space I'm told

Agree with every word pierre - really bad. Maybe designed for Beagles (now he switched over)

[Snoopy]

The further away from the last painful experience that we get, the more emboldened and self assured we become, until one day when we least expect it we experience and have to re-learn the lessons that we thought we had learnt a long time ago.

Two-bit finance companies dressed up in banking drag will be not only the first to be slaughtered, they will also be the deepest cut.

Heartland is a great share right now, sort of like the pied piper with many happy followers. It is however also best owned by those who have the skills to move very very quickly when circumstances change, which they inevitably will regardless of the underlying FA.


If I summarize your post correctly Baa-Baa, you are saying that if you own Heartland you should be very nervous and as soon as the tide looks like turning, race for the exit. Or maybe you should not own Heartland at all? This seems to me a very uncomfortable way to go about share investing: A recipe for remaining glued to a screen all day, to catch the earliest whiff of sentiment change.

While I agree that finance companies are are at heightened risk from an economic downturn, I would suggest an alternative risk minimization strategy.

1/ Make sure finance companies like Heartland are only a small part of your portfolio, say 10% at most.
2/ Check the 'stressed scenario' health of Heartland via some representative banking covenants on an at least annual basis.
3/ Use as a measuring stick, the relevant financial statistics of finance companies of equivalent size and risk profile to get an idea of 'comparative company health'.

SNOOPY

[Beagle]

Heartland leaders in the digital space I'm told

Agree with every word pierre - really bad. Maybe designed for Beagles (now he switched over)

Took me 10 minutes to get used too, just stuck my snout in there and sniffed around for a while and followed my nose, bit unusual I would agree but I'm not sure what all the fuss is about ?

Harmoney seems to be gaining traction. https://www.nbr.co.nz/article/harmoney-more-halves-annual-loss-revenue-climbs-63-b-205951?utm_source=ST&utm_medium=email&utm_campaign=ShareTrader+AM+Update+for+Wednesday+2 +August+2017

[winner69]

Unemployment rate falls to 8 year low ....... Heartland share price at 8 year high (guessing it is)

Prob means people feel quite secure in their jobs - borrow more ....or keep paying back what they owe Heartland

Awesome news - even more awesome when share price gets to 2 bucks

[Beagle]

One on here claims people very seldom post in real time what they're doing so I am topping up with some more today...just sayin, (in real time).
Actually not quite real time, posted before the market opened but after placing my order.
I know Percy and Winner are with me in spirit but have already backed the truck up and are overloaded with these awesome shares.

[Beagle]

Closed the week at a fresh all time high of $1.85 ! Shareholders are well positioned.

[percy]

One on here claims people very seldom post in real time what they're doing so I am topping up with some more today...just sayin, (in real time).
Actually not quite real time, posted before the market opened but after placing my order.
I know Percy and Winner are with me in spirit but have already backed the truck up and are overloaded with these awesome shares.

Real time.Sometimes posting in real time is not in your own best interests.Yesterday I sold down EBO in a thin market.The trust I help out on had a big holding.I emailed another trustee in Australia, sugesting the trust sold down. This was agreed, and the trust's broker was instructed accordingly.Once the trust shares were sold, I then posted my actions on EBO thread.
So real time has to be often delayed time.
So back to HBL.Well done team Beagle.$1.85 has meant you have raised the barrier.!!.
Can't ask for more from you.
Now that pie in the sky $2 .00 only requires HBL's sp to rise another 8.1%.Incredible.Who would have thought ???
And you are right,I am rather too "well positioned",nice position to be in...lol.

[Joshuatree]

If you joined together you would make a Team Pergle or Beaper, a Perbea or a Gleper:D

[percy]

If you joined together you would make a Team Pergle or Beaper, a Perbea or a Gleper:D

Yeah right.!!!...lol.
Do you think another .............you know who's " fail" posts will get us up to $2.00.??

[Beagle]

Percy - I thought I was pretty brave topping-up yesterday at $1.82...had to take a deep breath and think long term, five years down the track to pay that but when you start thinking long term the current price is still a compelling opportunity on a sensible PE compared to the vast majority of other stocks on the NZX. Steady growth is the key here. Yes agreed, I don't often post what I am doing in real time for exactly the reason you pointed out.

[winner69]

All time high ........awesome

Even more awesome when it hits 2 bucks ....before the end of the month ......before the announcement? Or after?

[percy]

Percy - I thought I was pretty brave topping-up yesterday at $1.82...had to take a deep breath and think long term, five years down the track to pay that but when you start thinking long term the current price is still a compelling opportunity on a sensible PE compared to the vast majority of other stocks on the NZX. Steady growth is the key here. Yes agreed, I don't often post what I am doing in real time for exactly the reason you pointed out.

Yes thinking five to ten years out,makes you see things a bit differently.
Over the past 10 years we have seen outstanding performances of companies "doing what they say they will do."
OK the likes of AIA and POT have huge moats around them,but others such as,,EBO FPH,FRE, MFT,and RYM have succeeded by having outstanding leadership,and directors with a lot of "skin in the game.".When MFT listed it was just another trucking firm.EBO was just a very small medical supply firm.Yet we now see them trading on PEs of between 21[EBO] and 24 {MFT].RYM were bringing a new approach to a very poorly rated sector?!!!
So although today we may think HBL is fully priced,the market appears to be looking further ahead than us.
ps.In real time I am neither a buyer or seller,just a happy dividend collector.

[Snow Leopard]

Percy - I thought I was pretty brave topping-up yesterday at $1.82...had to take a deep breath and think long term, five years down the track to pay that but when you start thinking long term the current price is still a compelling opportunity on a sensible PE compared to the vast majority of other stocks on the NZX. Steady growth is the key here...

This is a dangerous mind-state to fall into.

Those that do valuations properly have looked in the future, determined likely growth, made allowance for different possible scenarios and come up with a value which is less than the current market price.

Buying at a price now because you hope that value will catch up in a few years is not an astute purchase.

It is nearly as bad as coming up with 'novel' valuation techniques to try and justify over paying for a stock.

Meanwhile the share price continues the relentless climb and long may it continue, except for a sudden dramatic, but temporary, drop during DRiP price calculation time.

:)

Best Wishes
Paper Tiger

[Beagle]

Yes thinking five to ten years out,makes you see things a bit differently.
Over the past 10 years we have seen outstanding performances of companies "doing what they say they will do."
OK the likes of AIA and POT have huge moats around them,but others such as,,EBO FPH,FRE, MFT,and RYM have succeeded by having outstanding leadership,and directors with a lot of "skin in the game.".When MFT listed it was just another trucking firm.EBO was just a very small medical supply firm.Yet we now see them trading on PEs of between 21[EBO] and 24 {MFT].RYM were bringing a new approach to a very poorly rated sector?!!!
So although today we may think HBL is fully priced,the market appears to be looking further ahead than us.
ps.In real time I am neither a buyer or seller,just a happy dividend collector.

Yes mate you pay BIG BIG money for moat's on the NZX with the likes of AIA and POT trading well over a PE of 30 last time I looked....too rich for my liking as is FPH.
Better off combing through the quality well managed companies trading on a sensible PE with their own niche, lots more upside potential over the years ahead.
Last time I crunched the numbers HBL trading on a FY18 prospective PE in the late 13's seems very reasonably priced by comparison to the market overall and to its peer group by virtue of its superior growth rate and of course we know the Australian Govt in its "infinite wisdom" has just handed the Australian banks a special tax.

[beetills]

Just looking at an add for a Holden Colorado with finance at 1% from HBL.
Establishment fees of $656.That fee appears to be the highest that i have seen from various financing options.
Some ones making money somewhere.

[suse]

anyone have any thoughts on what is likely to happen re the share price around the election?

HBL makes up 80% of my portfolio and I will need to cash it in soon to help fund something else, although realistically I probably dont need it until early next year. If I could hang on to all my shares I'd be quite happy to be honest as the divvies are good (no DRP for me, I like cold hard cash :) )

[BlackPeter]

anyone have any thoughts on what is likely to happen re the share price around the election?

HBL makes up 80% of my portfolio and I will need to cash it in soon to help fund something else, although realistically I probably dont need it until early next year. If I could hang on to all my shares I'd be quite happy to be honest as the divvies are good (no DRP for me, I like cold hard cash :) )

Not sure I'd expect the election (no matter which way it goes) to make a big dent into HBL's share price - unless we draw the alleged link to the dairy market (not sure I am convinced, but some are) and assume that an all out victory for Green would crash our dairy industry.

Obviously - if the election outcome is leading into long negotiations and an unstable minority government (which is a distinct possibility), than all NZX shares (including HBL) are likely to suffer.

Independent from elections and HBL's specific expected performance - if you know that you need the money at a specified point in time (and that's months, not years), than I know what I would do: sell out soon and put the money you need early next year into a bank account. Sure - you might miss out on a 10% appreciation, but you might as well miss out on a 20% drop. Could you live with the latter?

[percy]

anyone have any thoughts on what is likely to happen re the share price around the election?

HBL makes up 80% of my portfolio and I will need to cash it in soon to help fund something else, although realistically I probably dont need it until early next year. If I could hang on to all my shares I'd be quite happy to be honest as the divvies are good (no DRP for me, I like cold hard cash :) )

I am an ex retailer.Both toys and books.Retail was usually better under Labour governments.So HBL will continue to prosper under which ever party wins the election.
NZ has had very stable governments under Helen Clark,John Key/Bill English,so I don't see either party would change things a great deal.
Now 80% of your portfolio in HBL is too greater risk in my opinion, espicially when you will be requiring that money shortly.
If it were me I would sell half now.

[silu]

I am an ex retailer.Both toys and books.Retail was usually better under Labour governments.So HBL will continue to prosper under which ever party wins the election.
NZ has had very stable governments under Helen Clark,John Key/Bill English,so I don't see either party would change things a great deal.
Now 80% of your portfolio in HBL is too greater risk in my opinion, espicially when you will be requiring that money shortly.
If it were me I would sell half now.

I have had a hospitality business for several years and I also found that we did better under a Labour government. Our customers were the type that "earn a dollar, spend a dollar" which spread our customer base far wider than it did over the last few years.

[suse]

If it were me I would sell half now.

Yes I have to admit to leaning towards dropping down on half of my HBL l and just putting in my Heartland bank account. When I first got my share account I was 99% in Heartland Percy. I've since diversified a little bit! :)



Sure - you might miss out on a 10% appreciation, but you might as well miss out on a 20% drop. Could you live with the latter?
I will wait to see what next monday brings probably. I have a good tolerance for risk and while I'd hate to see the share price shaved by 20% it wouldnt stress me majorly... (it would make me kick myself though) Yes, I am rather foolhardy.

[Beagle]

VIX in the U.S. is at an all time low or very close too that. U.S. markets seem to be in a sweet spot with the recent round of profit reporting on an average basis being comfortably ahead of analyst expectations and economy growing at a nice steady pace of 2-2.5% which is good for the economy and doesn't put any untoward inflation risks or pressure into the system, (similar conditions here). Interest rates both long and short term remain at or very close to generational lows in the U.S., N.Z. and in many other parts of the world.
HBL on a FY18 forward PE of approx. 14 against a market average of circa 20. It would take a really major exogenous shock to wipe 20% of HBL's SP in my opinion and while you can never say never and there is no such thing as risk free I think the risk of that happening is VERY VERY low. The path of least resistance appears to be a slow and steady melt upwards and I expect that to continue for the foreseeable future. HBL now about fair value in my opinion but compared to many parts of the rest of the market much of which is VERY fully priced it remains a compelling long term hold. It wouldn't surprise me if it did get to $2 a lot sooner than I had anticipated a little earlier in this thread.

[Baa_Baa]

VIX in the U.S. is at an all time low or very close too that. U.S. markets seem to be in a sweet spot with the recent round of profit reporting on an average basis being comfortably ahead of analyst expectations and economy growing at a nice steady pace of 2-2.5% which is good for the economy and doesn't put any untoward inflation risks or pressure into the system, (similar conditions here). Interest rates both long and short term remain at or very close to generational lows in the U.S., N.Z. and in many other parts of the world.
HBL on a FY18 forward PE of approx. 14 against a market average of circa 20. It would take a really major exogenous shock to wipe 20% of HBL's SP in my opinion and while you can never say never and there is no such thing as risk free I think the risk of that happening is VERY VERY low. The path of least resistance appears to be a slow and steady melt upwards and I expect that to continue for the foreseeable future. HBL now about fair value in my opinion but compared to many parts of the rest of the market much of which is VERY fully priced it remains a compelling long term hold. It wouldn't surprise me if it did get to $2 a lot sooner than I had anticipated a little earlier in this thread.

Now that's an interesting post Roger and a bit 'out there' for you. It says you look at the macro global situation and extrapolate that to local circumstances. Nice, as they unfortunately are inextricably interlinked. I reckon the whole house of cards is more vulnerable than at any time in history, and with our house on the vulnerable end of the whipping hose it's likely that the macro effect will be excentuated here more than most elsewhere. I wouldn't go anywhere near a bank in a topping market, let alone a second tier bank or a finance company in this environment (being nice). 20% downside is a heartbeat away when it turns to custard, you and we already know that, like many of our over priced companies, this is as vulnerable as it had ever been to a reversal in sentiment - and as you say connected to international sentiment, not just local. Well positioned, yeah right, positioned for what outcome?

[Beagle]

I was topping up as recently as last Thursday at $1.82 so I am sure it won't come as a surprise to you Baa Baa that I completely disagree with you and am more than happy to back my own judgement of the risks and rewards.

[iceman]

VIX in the U.S. is at an all time low or very close too that. U.S. markets seem to be in a sweet spot with the recent round of profit reporting on an average basis being comfortably ahead of analyst expectations and economy growing at a nice steady pace of 2-2.5% which is good for the economy and doesn't put any untoward inflation risks or pressure into the system, (similar conditions here). Interest rates both long and short term remain at or very close to generational lows in the U.S., N.Z. and in many other parts of the world.
HBL on a FY18 forward PE of approx. 14 against a market average of circa 20. It would take a really major exogenous shock to wipe 20% of HBL's SP in my opinion and while you can never say never and there is no such thing as risk free I think the risk of that happening is VERY VERY low. The path of least resistance appears to be a slow and steady melt upwards and I expect that to continue for the foreseeable future. HBL now about fair value in my opinion but compared to many parts of the rest of the market much of which is VERY fully priced it remains a compelling long term hold. It wouldn't surprise me if it did get to $2 a lot sooner than I had anticipated a little earlier in this thread.

Interesting Beagle. So is this from Financial Times https://www.ft.com/content/95808118-662e-11e7-9a66-93fb352ba1fe

Sorry this has little to do with HBL but thought I'd post it anyway.

[mfd]

HBL on a FY18 forward PE of approx. 14 against a market average of circa 20. It would take a really major exogenous shock to wipe 20% of HBL's SP in my opinion and while you can never say never and there is no such thing as risk free I think the risk of that happening is VERY VERY low. The path of least resistance appears to be a slow and steady melt upwards and I expect that to continue for the foreseeable future. HBL now about fair value in my opinion but compared to many parts of the rest of the market much of which is VERY fully priced it remains a compelling long term hold. It wouldn't surprise me if it did get to $2 a lot sooner than I had anticipated a little earlier in this thread.

HBL dropped 20% 2 years ago without a major shock. Sure, dairy prices were low but the bank consistently reported increasing profits throughout. I wouldn't consider it particularly unlikely for there to be another 20% drawback in the next few months personally and certainly wouldn't stick 80% of a portfolio I expected to need to take money from shortly in a single stock.

disc: I sold out at 1.78 back in May and the rest of my portfolio has performed better than HBL in the meantime.

[Snow Leopard]

Now that's an interesting post Roger and a bit 'out there' for you. It says you look at the macro global situation and extrapolate that to local circumstances. Nice, as they unfortunately are inextricably interlinked. I reckon the whole house of cards is more vulnerable than at any time in history, and with our house on the vulnerable end of the whipping hose it's likely that the macro effect will be excentuated here more than most elsewhere. I wouldn't go anywhere near a bank in a topping market, let alone a second tier bank or a finance company in this environment (being nice). 20% downside is a heartbeat away when it turns to custard, you and we already know that, like many of our over priced companies, this is as vulnerable as it had ever been to a reversal in sentiment - and as you say connected to international sentiment, not just local. Well positioned, yeah right, positioned for what outcome?

You seem to be a bit of a sour sheep these days BB.

I thought you were one of the trendy sheeps who would be happy as what with the SP going up and up and up.
Surely all we all have to do is sell on the break without shedding wool over the when, why & how?
Easy peasy and the only way to do it.

The DRiP looks less enticing by the day.

BW
PT (hyt)

[Beagle]

Everyone is entitled to their own opinion. I sat out the dairy crisis as my perception was that those two years or so were a period of time when the systemic risks from that sector to the HBL balance sheet were too high. I don't see anything like the risk that existed at that time.

[RTM]

Everyone is entitled to their own opinion. I sat out the dairy crisis as my perception was that those two years or so were a period of time when the systemic risks from that sector to the HBL balance sheet were too high. I don't see anything like the risk that existed at that time.

Interesting, I see the Global Geopolitical risks, Trump, and our own internal elections creating a lot more uncertainty and risk at the moment. Clearly I'm wrong, as the markets all going well. But for those reasons I am largely sitting on my hands....and losing...at the moment.

[Beagle]

Interesting, I see the Global Geopolitical risks, Trump, and our own internal elections creating a lot more uncertainty and risk at the moment. Clearly I'm wrong, as the markets all going well. But for those reasons I am largely sitting on my hands....and losing...at the moment.

Fair enough, at least unlike others you admit this is a losing strategy at present whereas some others are in denial. Global markets don't seem concerned by the sabre rattling over North Korea, Trump fiasco will go on and on and probably a relief rally if he eventually gets impeached and the Greens thanks to the considerable "talents" of their co-leader are ostensibly in self-destruct. http://www.msn.com/en-nz/news/national/comment-metiria-is-causing-the-greens-to-self-destruct/ar-AApBevd?ocid=spartandhp

Can't rule out the possibility of some sort of unholy left wing alliance incorporating Winston Peter's but I'm prepared to bet he's more likely to jump into bed with the Nat's. Not sure any of that impacts HBL to any material degree. That's as clear as I can polish up my opaque crystal ball :)
P.S. I sat on my hands after Trump was elected (because I thought it would have a dramatic negative effect on world equity markets) for about a month or so, cost me plenty and not something I want to repeat.

[percy]

Interesting, I see the Global Geopolitical risks, Trump, and our own internal elections creating a lot more uncertainty and risk at the moment. Clearly I'm wrong, as the markets all going well. But for those reasons I am largely sitting on my hands....and losing...at the moment.

Life goes on.
I have enjoyed watching the young couple who moved into an oldish house, across the road from us.
No cares about Trump,or anything else.Just too busy with the baby,tidying up their section,building a lovely new fence,a garage,and new concete drive.In the short term they appear to be positive too,as they have planted plants.
I get the same positive vibes each time I deliver my books to primary schools.Hundreds of bright, full of life young people.

[Beagle]

Life goes on.
I have enjoyed watching the young couple who moved into an oldish house, across the road from us.
No cares about Trump,or anything else.Just too busy with the baby,tidying up their section,building a lovely new fence,a garage,and new concete drive.In the short term they appear to be positive too,as they have planted plants.
I get the same positive vibes each time I deliver my books to primary schools.Hundreds of bright, full of life young people.

I think that's why you keep working your business at your young age. You enjoy the people contact, (don't need the money). All the reason you need :)

[Bjauck]

Interesting, I see the Global Geopolitical risks, Trump, and our own internal elections creating a lot more uncertainty and risk at the moment. Clearly I'm wrong, as the markets all been going well. But for those reasons I am largely sitting on my hands....and losing...at the moment. Not a professional analyst's approach, but as the markets have had some good years, I have been gradually reducing some of my holdings (not HBL however) now. I got seller's remorse almost immediately when I reduced my ATM holding :( but it had become my largest shareholding.

[t.rexjr]

Life goes on.
I have enjoyed watching the young couple who moved into an oldish house, across the road from us.
No cares about Trump,or anything else.Just too busy with the baby,tidying up their section,building a lovely new fence,a garage,and new concete drive.In the short term they appear to be positive too,as they have planted plants.
I get the same positive vibes each time I deliver my books to primary schools.Hundreds of bright, full of life young people.

It's a sentiment that people tend to forget when they're absorbed in the political and financial world. For a large percentage of the population life does indeed go on. Same thing different day...

I also kind of think the world is becoming a little immune to the shocks of the world so the impact they have are decreasing... possibly

[janner]

The DRiP looks less enticing by the day.

BW
PT (hyt)

Of course it doe's .. Common sense tells you the money can possibly be used better some where else..

However !!.. Will you ever spend SO little buying HBL shares again ???.. At a discount.. Minus brokerage ??

HBL. Is IMO. A good company for any one's portfolio..

Disc. Looooong time happy holder..

[winner69]

Fundamentals win out at the end of the day

All the talk about politics and wars and other things are just a distraction .....some call it noise. Best forgotten unless you are playing the game of punting on short term movements in the share price.

[janner]

Fundamentals win out at the end of the day

All the talk about politics and wars and other things are just a distraction .....some call it noise. Best forgotten unless you are playing the game of punting on short term movements in the share price.

So what are you saying ???

[Beagle]

So what are you saying ???

I'll take a stab....just relax, put your feet up and enjoy the ride to $2 and beyond :t_up:

[janner]

I'll take a stab....just relax, put your feet up and enjoy the ride to $2 and beyond :t_up:

Inevitable the way it is going.. How ever .. Please let it just happen.. We really do not need ALL HANDS TO THE PUMP..

[Beagle]

Inevitable the way it is going.. How ever .. Please let it just happen.. We really do not need ALL HANDS TO THE PUMP..

Roger that, had my 3 cents already and busy anyway.

[janner]

Roger that, had my 3 cents already and busy anyway.

Land of nod for me... Hopefully not another few cents up when I awake.. DRP...DRP...DRP...

[suse]

when and how is the DRP calculated?

[winner69]

when and how is the DRP calculated?

Wednesday night just after 8pm

[suse]

Wednesday night just after 8pm
LOL, only in my dreams

[pierre]

Land of nod for me... Hopefully not another few cents up when I awake.. DRP...DRP...DRP...

If the SP heads to the magical SP of $2.00, HBL will climb to over 25% of my total share portfolio, so I've just cancelled my participation in the DRP.

I think HBL is a great business and Mr Market seems to love it too. it's grown to be my largest single holding and has more than doubled in value over my average cost price. However, I don't think it's wise to let it go much higher as a percentage of my holdings so I really don't want to own any more HBL - but I can't pluck up the courage to sell any right now either.

Apart from a couple of holdings at 11% and 15% the remainder of my funds are spread over 18 other companies so I'm pretty well diversified.

I think the whole market is pretty "toppy" at the moment so I'm taking all my upcoming dividends in cash and accumulating a few bucks in case there is a bit of a correction and some buying opportunities appear.

[winner69]

If the SP heads to the magical SP of $2.00, HBL will climb to over 25% of my total share portfolio, so I've just cancelled my participation in the DRP.

I think HBL is a great business and Mr Market seems to love it too. it's grown to be my largest single holding and has more than doubled in value over my average cost price. However, I don't think it's wise to let it go much higher as a percentage of my holdings so I really don't want to own any more HBL - but I can't pluck up the courage to sell any right now either.

Apart from a couple of holdings at 11% and 15% the remainder of my funds are spread over 18 other companies so I'm pretty well diversified.

I think the whole market is pretty "toppy" at the moment so I'm taking all my upcoming dividends in cash and accumulating a few bucks in case there is a bit of a correction and some buying opportunities appear.

It will be evena greater proportion when share price reaches $2.50 early next year (maybe even by Christmas)

[percy]

It will be evena greater proportion when share price reaches $2.50 early next year (maybe even by Christmas)

I concur........................lol.

[pierre]

It will be evena greater proportion when share price reaches $2.50 early next year (maybe even by Christmas)

I love your eternal optimism Winner - and I presume you mean this Christmas!

It will be a real struggle to deal with the challenge of a $2.50 SP, but I'm sure I will cope - with help from both you and Percy!

[horus1]

I always calculate the % on how much I put in . Otherwise I sell my best shares. I have about 20% in them on market value but 10% on cost ,I'm happy to go to 15-20% on cost. Every dividend I put 50 % back in.

[iceman]

when and how is the DRP calculated?

Like this and they normally apply 2.5% discount:
" The strike price is the volume weighted average sale price in New Zealand
dollars (expressed in cents and fractions of cents) for a
Share calculated on all trades of Shares which took place
through the NZX Main Board over the period of 5 trading
days immediately following the Record Date."

[Baa_Baa]

Surely all we all have to do is sell on the break without shedding wool over the when, why & how?
Easy peasy and the only way to do it

Good question, without refuting the supposition that financial stocks are the first to be hammered and the worst hit in a reversal of global markets sentiment.

It is a long bow to draw suggesting all have the wherewithal to make timely decisions on when to exit. Most here are in it for the FA, the encouragement and the relentless SP appreciation, or some or all of the above

What many may not realise is those same few rampers are adept at being first in the exit queue when the sh1t inevitably hits the fan. And they won't tell until weeks or months afterwards, about their miraculously timely exit. Talk the book, just the book and only the book. All good when it's relentless upwards which we all know doesn't go on forever.

This isn't a school of hard knocks, it's a school of buyer beware.

If that's being a sour sheep, we'll excuse me for pointing out the obvious.

[Joshuatree]

i agree buyer beware ; If you are easily influenced you could get the dump from the pumper.

[percy]

I often worry about the influence Sharetrader has.
I would guess Sharetrader members/guests hold over $15mil worth of Heartland stock.
There are a great number of people who are not posters,but read Sharetrader.
These people do not know who posts drivel,and who knows what they are talking about.
No one bothers to read a whole thread, so they can find out for themselves.
The only way to be successful in the sharemarket, is to put in the hard work doing your own research.
No internet discussion forum is a "magic bullet".It is just a discussion forum,where we discuss shares.
Therefore "cavaet emptor."

[winner69]

HBL has been rerated over the last year or so to the extent that is now outrageously overvalued (see previous posts)

But ever mind the world is such a happy place at the moment - even the S&P500 is now trading on price:sales ration never ever been seen before (even 2000/2001)

So don't worry about a outrageous valuation of HBL - sentiment will take it much higher. They can do no wrong and that's enough

HBL will be $2 at announcement time and when Jeff mentions $70m profit for F18 the share price could go anywhere. HBL has as much appeal as that awesome Jacinda has so what can go wrong.

Did Percy say $2.50 next year

[percy]

It will be evena greater proportion when share price reaches $2.50 early next year (maybe even by Christmas)

Was only agreeing with you.
Will be on record you had the foresight to predict $2.50 first.
At that time, the in hindsighters will be moaning they did not top up under $1.90.

[Beagle]

Is a FY18 PE of ~ 14.5 really overpriced given their track record of steady growth and especially relative to a market trading on average at over 20 times FY18 earnings ?
Maybe the stock has been mispriced in the past trading on 12.5 - 13.5 times forward earnings ?
Talk of $2.50 seems a little presumptuous to me but then again we have some quality companies trading on multiples well into the 30's so maybe a mid-late teens forward PE is possible ? One thing for sure, I will not be selling when it hits $2.

[Hectorplains]

Is a FY18 PE of ~ 14.5 really overpriced given their track record of steady growth and especially relative to a market trading on average at over 20 times FY18 earnings ?
Maybe the stock has been mispriced in the past trading on 12.5 - 13.5 times forward earnings ?
Talk of $2.50 seems a little presumptuous to me but then again we have some quality companies trading on multiples well into the 30's so maybe a mid-late teens forward PE is possible ? One thing for sure, I will not be selling when it hits $2.

Sold out of my position completely today. I'm happy to move on and likely to do so with energy stocks too. For mine, forward PE of 14+ is fully priced (and some more) even with their recent track record yadda yadda. Comparison to 20x wider market may be relative but most of my relatives are awful... and financially illiterate. Good luck with $2.50...

[Beagle]

Sold out of my position completely today. I'm happy to move on and likely to do so with energy stocks too. For mine, forward PE of 14+ is fully priced (and some more) even with their recent track record yadda yadda. Comparison to 20x wider market may be relative but most of my relatives are awful... and financially illiterate. Good luck with $2.50...

Fair enough but what's the alternative ?, we agree the whole market is priced "up there" FWIW I had another look at my forward estimates on this one the other day and assuming fair / reasonable market / economic conditions I don't see $2.50 until 2019, (probably late that year). Interestingly based on average 4trader forward earnings estimates this stock shows a 4-5% superior growth rate compared to the average of its peer banks in Australia, HBL estimated earnings growth 7-8% over the FY18 and FY19 years vs average of WBC, NAB, ANZ BOQ and BEN 2-3% earnings growth outlook.

HBL currently trades on a PE premium of 1.6 extra (14.6) on FY 18 estimated EPS of 12.9 cps compared to an average of 13 for its peers for the same year but to my mind that premium plus potentially a little bit more is certainly warranted based on their superior track record and forecast growth in EPS. My fair value for the stock is currently $1.83-$1.90 as of Friday this week based on estimated EPS for FY18 and FY19 but I'll know more tomorrow. I would lighten my position somewhat if it got to more than 115% of where I see fair value.

[Snow Leopard]

https://youtu.be/0KhTk7uD16U

Hoping for 12c EPS, a choice dividend & a forecast of good EPS growth.


Salam Hangat
Paper (Java) Tiger

[winner69]

Bugger - Jeff didn't mention $70m for F18

Playing games with us again is Jeff - leaving that to next Feb / March

[silu]

HEARTLAND POSTS FULL YEAR PROFIT OF $60.8M

14 August 2017

Heartland Bank Limited (Heartland) (NZX: HBL) achieved a net profit after tax
(NPAT) of $60.8m for the full year ended 30 June 2017 (FY2017), an increase
of 12% from the previous financial year ended 30 June 2016 (FY2016). The
increase in profitability was driven primarily by growth in receivables
across all divisions - Household, Business and Rural.

Achievements for the year ended 30 June 2017

o Increase in profitability of 12%
o Strong growth in receivables of 14%
o Return on equity (ROE) of 11.6%
o Launch of multiple digital platforms
o Implementation of new core banking system

[winner69]

https://youtu.be/0KhTk7uD16U

Hoping for 12c EPS, a choice dividend & a forecast of good EPS growth.


Salam Hangat
Paper (Java) Tiger

Spot on PT ....they published 12 cents .....on a weighted average number of shares

[winner69]

Result almost as awesome as Jacinda's awesomeness

[Beagle]

Awesome result, very very pleased.
Highlights for me.
Final Dividend 5.5 cps, my expectation was 5 cps.
EPS was 12.33 cps on weighted average number of shares v 11.44 cps last year = 7.8% growth in EPS
Forecast at mid point of $66.5m on current number of issued shares = 13.39 cps next year which suggest growth accelerating on an EPS basis to 8.6%, slightly above my expectation of 7.5% EPS growth for FY18.
Growth in reverse mortgages in Australia to over $500m, growth in receivables of 19% !
My expectation is fully imputed dividend of 10 cps next year and on $1.86 this gives (10 / 186) / 0.72 = 7.5% gross yield.
Revised target price for early 2018 $2.08.

[silu]

Good result. Very pleased to still hold a big chunk for the foreseeable future although happy that I was able to lock in some profit at $1.89 last week.

[BlackPeter]

YAWN - quite boring if the actual data exactly hit predictions and the official outlook is what the analysts in 4-traders predicted a long time ago, isn't it?

But than - in the investment game I tend to like predictability, particularly if it comes with 10+% growth :).

I like boring stocks - could we have another helping?

[RTM]

Awesome result, very very pleased.
Highlights for me.
Final Dividend 5.5 cps, my expectation was 5 cps.
EPS was 12.33 cps on weighted average number of shares v 11.44 cps last year = 7.8% growth in EPS
Forecast at mid point of $66.5m on current number of issued shares = 13.39 cps next year which suggest growth accelerating on an EPS basis to 8.6%, slightly above my expectation of 7.5% EPS growth for FY18.
Growth in reverse mortgages in Australia to over $500m, growth in receivables of 19% !
My expectation is fully imputed dividend of 10 cps next year and on $1.86 this gives (10 / 186) / 0.72 = 7.5% gross yield.
Revised target price for early 2018 $2.08.

Roger...is this of any concern ? Any idea what this looks like going back say 5 years ?

"Heartland’s Net Interest Margin (NIM) for FY2017 was 4.46% compared to 4.50% for FY2016. The reduction results primarily from changes in the asset mix."

To my simple way of thinking....this is how they make their (our) money, loaning out our deposits.

[McGinty]

Hi all,

Just been looking through the results and was wondering what advantage there is for us shareholders for a company to use a 'weighted average number of share" vs the total number of share at the reporting date?

On the surface it looks as if the 'weighted average' helps paint a prettier picture of the earnings per share (and EPS growth rate), yet in reality the number of shareholders entitled to a share of the profits is in fact the number of shareholders at report dating.

Any clarity on this will be gratefully appreciated :)

[Beagle]

Roger...is this of any concern ? Any idea what this looks like going back say 5 years ?

"Heartland’s Net Interest Margin (NIM) for FY2017 was 4.46% compared to 4.50% for FY2016. The reduction results primarily from changes in the asset mix."

To my simple way of thinking....this is how they make their (our) money, loaning out our deposits.

NIM is best of breed mate and a small change like that is not of any concern. Probably reflects the strong growth in reverse home equity loans which are at the lower risk end of the lending spectrum.

Almost all companies use weighted average number of shares on issue McGinty, HBL have been doing this for years as it more accurately reflects the EPS situation.

[Oliver Mander]

Have to admit, I always use the "current" number of shares in my analysis, for the reasons you outline.
So 516.2m shares...EPS of 11.8cps. Still a good result though.

Always nervous at EPS dilution activities...good to issue new shares for divvies or acquisition, but we should be ensuring that it stilla dds up to value for individual shareholders...

[winner69]

Hi all,

Just been looking through the results and was wondering what advantage there is for us shareholders for a company to use a 'weighted average number of share" vs the total number of share at the reporting date?

On the surface it looks as if the 'weighted average' helps paint a prettier picture of the earnings per share (and EPS growth rate), yet in reality the number of shareholders entitled to a share of the profits is in fact the number of shareholders at report dating.

Any clarity on this will be gratefully appreciated :)

Theory says it reflects the actual performance of the company relative to its capital over the full year.Think they didn't have all that new capital to play with for the full year (implies if they did they did they would have made more ..yeah right)

[BlackPeter]

Average 4traders EPS forecast for FY18 12.9 cps. Company forecast at mid-point, 13.4 cps.
4Traders expected growth in EPS for FY18 7%, actual forecast EPS growth 8.6%.

I hate to contest your statement, however:
company forecast for 2018 is a NPAT of 65 to 68m. Right?
Divide this through the number of currently issued shares (516.9m - not some average balanced mumbo jumbo for FY 2017) and you end up with 12.57 to 13.16 cents per share EPS, medium being 12.87 cents / share. 4-traders predicted for 2018 12.9 cents per share - I think this is close enough ;);

and yes - and my comment re growth rates was referring to the 2017 growth rates: 12.5% CAGR ... sorry for not being specific enough for you :p

[Beagle]

Have to admit, I always use the "current" number of shares in my analysis, for the reasons you outline.
So 516.2m shares...EPS of 11.8cps. Still a good result though.

Always nervous at EPS dilution activities...good to issue new shares for divvies or acquisition, but we should be ensuring that it stilla dds up to value for individual shareholders...

Fair enough and each to their own.
Checking through, yes forecast of $66.5m on 516.7m shares = 12.9 cps this year v 11.8 cps = 9.4% profit growth expected in EPS this year. Solid numbers and good outlook for EPS growth no matter how you slice and dice it, in my opinion.

[winner69]

Heartland reports EPS on round numbers

Using their stated weighted average number of shares and assuming no new shares in F18 (even though Jeff will get some free/cheap ones and then there's a couple of DRIPS as well) EPS comparisons are

F16 EPS 11.44 cents
F17 EPS 12.33 cents - plus 7.7%
F18 EPS at $68m 13.17 cents - plus 6.8%
F18 EPS at $65m 12.59 cents - plus 2.1%

EPS growth (on reported numbers) slowing even at likely high case

EPS growth much less than current PE .........hmmmmmm

[silu]

Article of interest:
Heartland Bank goes live on Oracle core banking platform as Kiwibank struggles
Heartland Bank chief financial officer David Macrell says delays were out of caution rather than any significant issues.

https://www.reseller.co.nz/article/623485/heartland-bank-goes-live-oracle-core-banking-platform-kiwibank-struggles/

[percy]

Absolute cracker.
Well done Heartland Bank team,you have done yourselves and shareholders proud, yet again..
Will enjoy the incresed divie.
Wonder what size the bond issue will be.?

[winner69]

Article of interest:
Heartland Bank goes live on Oracle core banking platform as Kiwibank struggles
Heartland Bank chief financial officer David Macrell says delays were out of caution rather than any significant issues.

https://www.reseller.co.nz/article/623485/heartland-bank-goes-live-oracle-core-banking-platform-kiwibank-struggles/

Made an (embarrassing) mistake calculating interest on Term Deposits last month (at least I think that's what the letter they sent me said)

[McGinty]

Have to admit, I always use the "current" number of shares in my analysis, for the reasons you outline.
So 516.2m shares...EPS of 11.8cps. Still a good result though.

Always nervous at EPS dilution activities...good to issue new shares for divvies or acquisition, but we should be ensuring that it stilla dds up to value for individual shareholders...

Yes my EPS growth rate on "current" shares is 3.43% on pcp

FY17: $60.8m / 516.68m = EPS of 11.76
FY16: $54.2m / 476.5m = EPS of 11.37

And looking back at last years announcements, the number of share increases further prior to Ex-div from 476.5 at report date to 481m (LTI options plan) at Ex-date.

[Oliver Mander]

Fair enough and each to their own.
Checking through, yes forecast of $66.5m on 516.7m shares = 12.9 cps this year v 11.8 cps = 9.4% profit growth expected in EPS this year. Solid numbers and good outlook for EPS growth no matter how you slice and dice it, in my opinion.

Agree. Even at the low end of the stated range ($65m) its still 12.6 cps (6.8%).
Since I've joined ST, I notice the phrase "well-positioned" seems to be used a lot in relation to HBL. I also feel well-positioned...:-)

[Beagle]

Aussie banks forecast to grow at 3.6% and 2% respectively in EPS for FY18 and FY19 according to 4 traders. Average of ANZ, WBC NAB, BEN and BOQ
Using my version of Ben Graham's formula where PE is 8.5 for no growth plus 1 x g Aussie banks should be on 12.1 average, current average 13.
Depending on how you slice and dice the numbers for HBL you get 8.5 + 1g where G is approx. 7-9% = PE of ~ 16.5
16.5 x 12.9 cps = $2.13 = no worries plus the stock currently trades cum a 5.5 cps fully imputed dividend.
Can't see Winner69 and Percy getting their $2.50 anytime soon unless there's a takeover :eek2:

[Snoopy]

Hi all,

Just been looking through the results and was wondering what advantage there is for us shareholders for a company to use a 'weighted average number of share" vs the total number of share at the reporting date?

On the surface it looks as if the 'weighted average' helps paint a prettier picture of the earnings per share (and EPS growth rate), yet in reality the number of shareholders entitled to a share of the profits is in fact the number of shareholders at report dating.

Any clarity on this will be gratefully appreciated :)

I always use the number of shares at the end of the year to calculate my 'eps' figures McGinty.

One reason is that the number of shares on issue at the end of the year is easy to find, whereas shareholders actually have no easy way to calculate the 'weighted average number of shares.' on issue over a year. The other reason is that for the current year looking forwards the 'weighted average number of shares' becomes an historical irrelevance. We all know that earnings for the coming year must be spread over (at least) the current number of shares on issue. So using the current number of shares provides a better measuring stick as to whether the the coming year results are really an improvement.

There is an argument that if new capital via new shares has been raised during the year, that this new capital has not been available to the company all year. So the new shares, representing this new capital, should not be counted. There is nothing wrong with this argument. Yet for dividend hounds, the dividend is always paid on the current number of shares on issue when the dividend is declared. So once again the 'weighted average number of historical shares' has no relevance.

Using the current number of shares on issue will yield either neutral or conservative projections. There is no bad thing in building a little conservatism into your projected investment returns.

SNOOPY

[Oliver Mander]

Yes my EPS growth rate on "current" shares is 3.43% on pcp

FY17: $60.8m / 516.68m = EPS of 11.76
FY16: $54.2m / 476.5m = EPS of 11.37

And looking back at last years announcements, the number of share increases further prior to Ex-div from 476.5 at report date to 481m (LTI options plan) at Ex-date.

Yes, hence my comments on earnings dilution posted above, and using the "actual" number of shares rather than the weighted average. I like the share and i like the result, but will always try to factor in some EPS dilution due to share issue on this one.

[Beagle]

No mention of the expected quantum of the capital notes issue or their intended purpose. Capital adequacy looks good at 13.6%. Modest share buy-back to boost EPS ?

[McGinty]

Thanks for your thoughts fellow members :)

It's one thing I've been wondering for a while and was interested in how others view it.

As Snoopy mentioned above "the current number of share provides a better measuring stick", as look forward to the upcoming year.

So my opinion on the upcoming year will be that HBL achieve the higher end of their guidance ($68m) and would possibly dilute the shares down by another 23m shares (LTI and two DRP's) Total FY18 shares approx 540m

FY18: $68m/540m = EPS 12.6
FY17: $60.8/516.68 = EPS 11.76

est FY18 EPS growth = 7.14%

[trader_jackson]

The results are as expected, a fraction ahead of guidance.
We all know next year will be $68.9 million, worst case.
Still seems pretty expensive, but no doubt HBL will continue to defy gravity and we'll see $2 before next years result announcement.
(disclosure: no longer a holder, but keeping a close eye)

[winner69]

Book Value is $1.10 a share - June 2016 it was $1.05 so up about 5%

Share price up about 50% in the meantime

WOW - that's some rerating ....P/B now over 1.7. That's pretty high

No doubt the rerating will continue -- maybe Heartland (Jeff) is more awesome than the awesome Jacinda

Come 2 bucks by weeks end

[Beagle]

You won't think Jacinda so awesome if they get in and as stated on the weekend introduce a capital gains tax, Jeff still be awesome though :)

[couta1]

Funny thing the old market, CEN up 13c on a poor result and HBL unchanged. Disc-Not holding either.

[winner69]

Share price turned turtle after hitting 190

Hope not start of a downtrend.

[percy]

Share price turned turtle after hitting 190

Hope not start of a downtrend.

It is just Janner and Iceman manipulating the market so they get more shares via DRP........lol.

[winner69]

Interesting line in cash flow reconciliation is 'Capitalised Interest'

Amounts have gone from $2m in F15 to $25m in F16 to $32m in F17

I assume this is the interest charged on the home equity stuff waiting for the oldies to die (or move out)

An ever increasing amount .....and needing funding at ever increasing rates

Good eh

[beetills]

Poster on ''interest.co.nz'' says that'''profitablity in the 2017 financial year was driven primarily by growth in receivables,and impaired expenses increased'''
Not being financially intelligent is he right,wrong or just upset he doesn't have shares in HBL.

[winner69]

Talking if reverse mortgages

They increased by $39m in F16 (heartland preso)

And increased by $126m in F17

Wow - all that advertising paying off.

[percy]

Poster on ''interest.co.nz'' says that'''profitablity in the 2017 financial year was driven primarily by growth in receivables,and impaired expenses increased'''
Not being financially intelligent is he right,wrong or just upset he doesn't have shares in HBL.

Yes,and yes and no.
Yes big growth in receivables.
Yes impairements increased.
No,Impairements as a % of total reveivables decreased.
Business as usual.

[percy]

Talking if reverse mortgages

They increased by $39m in F16 (heartland preso)

And increased by $126m in F17

Wow - all that advertising paying off.
The huge increase was in Australia via brokers.
To get the same sort of increases in NZ they really need a big competitor to grow the market.
The reverse mortgage sector is a very sound /secure sector for HBL to be big in.

[Beagle]

Agree that the serious traction in the Australian reverse equity lending book was a standout feature of the results presentation. Highly impressive gains in a very large market and its a niche area that's poorly served by the Australian banks. I'm thinking this will be a very lucrative high growth area going forward.
No worries, $2.00 in due course.

[winner69]

Yes,and yes and no.
Yes big growth in receivables.
Yes impairements increased.
No,Impairements as a % of total reveivables decreased.
Business as usual.

Wrote back some of the rainy day money in rural that wasn't needed

That helped

[Beagle]

Wrote back some of the rainy day money in rural that wasn't needed

That helped

I'm starting to wonder if those huge net interest margins might be simply too tempting for one of the big Australian banks or BEN or BOQ especially with the huge momentum in the reverse home equity business in Australia. Can't rule out the possibility of a takeover. All those shiny new digital platforms with almost unlimited scalability for the larger banks...hmmm I imagine they could integrate HBL into their existing operations with little or no addition to overhead and get massive synergies from the combined operation and massive new business utilizing HBL's systems and architecture.... You'd be a brave person to short this stock that's for sure !

[Snow Leopard]

Poster on ''interest.co.nz'' says that'''profitablity in the 2017 financial year was driven primarily by growth in receivables,and impaired expenses increased'''
Not being financially intelligent is he right,wrong or just upset he doesn't have shares in HBL.

The interest.co.nz comment just reinforces my belief that some people should not be allowed near keyboards.

But the unacknowledged elephant in the room is, of course, that of the $61M profit over half comes from capitalising interest :scared:. [Note: do not panic]

I am happy, not ecstatic, but happy, with the result :mellow:.
It is OK.

Best Wishes
Paper Tiger

[ziggy415]

Just wondering how big the capital notes raising is going to be...seems to be a lot of lead brokers and sub lead brokers etc....seems a lot if it's only 20 mill......raising is just before HNA group due to buy UDC finance unless chinese govt stops it.......

[Snow Leopard]

Wrote back some of the rainy day money in rural that wasn't needed

That helped

We will leave Snoopy to worry about 19(b) then shall we?
Nearly doubled!

and Other Corporate, I hardly dare look again!

Still, overall, it is OK isn't it?

Best Wishes
Paper Tiger

[Snoopy]

I'm starting to wonder if those huge net interest margins might be simply too tempting for one of the big Australian banks or BEN or BOQ especially with the huge momentum in the reverse home equity business in Australia.


The Heartland net interest margins may be high for a bank. But they are low for a finance company. And when you apply the 'duck test' to Heartland, you can see into what category the Aussies will park it.



Can't rule out the possibility of a takeover. All those shiny new digital platforms with almost unlimited scalability for the larger banks...hmmm I imagine they could integrate HBL into their existing operations with little or no addition to overhead and get massive synergies from the combined operation and massive new business utilizing HBL's systems and architecture.... You'd be a brave person to short this stock that's for sure !


The problem is Heartland has generated a big fat zero of cash if you add everything up post inception (my post 9366). For a takeover to be a success the one doing the takeover uses the positive cashflow from what it acquires to finance the deal. The problem is, over the long term, Heartland doesn't generate positive cashflow. So such a takeover would not be attractive.

SNOOPY

P.S. The Heartland digital platforms are not as good as the Auusie bank's own digital platforms. So nothing of interest to acquire there either!

[horus1]

I love heartland. Bought more today

[Beagle]

http://www.sharechat.co.nz/article/14c0f1fb/heartland-s-digital-focus-gaining-traction-among-small-businesses.html?utm_medium=email&utm_campaign=Heartlands%20digital%20focus%20gainin g%20traction%20among%20small%20businesses&utm_content=Heartlands%20digital%20focus%20gaining %20traction%20among%20small%20businesses+CID_efe2f e4aa8f9e2aacaf9066b79e8ebc4&utm_source=Email%20marketing%20software&utm_term=httpwwwsharechatconzarticle14c0f1fbheartl and-s-digital-focus-gaining-traction-among-small-businesseshtml

https://www.nzx.com/files/attachments/263330.pdf

Page 17 - SP graph relative to NZX50 is quite an eye-opener !

[Oliver Mander]

late rally...close at 190. Was that another "resistance point" from a chartist perspective? (as in, a genuine question - would love to know!)

[winner69]

We will leave Snoopy to worry about 19(b) then shall we?
Nearly doubled!

and Other Corporate, I hardly dare look again!

Still, overall, it is OK isn't it?

Best Wishes
Paper Tiger

Holy ****

I'd stay away from looking at that as well

[winner69]

That Note 19b sort of suggests that the modus operandi for Open for Business is working capital in minutes ......but take ages to pay.

Just a thought

[Baa_Baa]

19b is no worries until the cheer leaders become apologists. Ain't happening on their watch, that's for sure. Caveat emptor as one emboldened investor recently ventured. Rejoice in success of the moment, but don't look too closely under the covers as it's uncomfortable pointing out stretched market valuations and contrived company numbers in climates of increasing uncertainty. Looks like a good scalp if you can bank the capital gains and the divi, but medium term there are vulnerabilities which few wish to acknowledge. Long term who really knows?

[bullfrog]

Bought in when I saw their link to harmoney, thought it showed foresight and courage underpinned by some solid numbers. However, got my fingers, toes and arms crossed with the implementation of oracle. Never underestimate the disruption upgrading core systems cause, just hope they don't get too distracted by doing business with themselves rather than growing the business with others.

[artemis]

Bought in when I saw their link to harmoney, thought it showed foresight and courage underpinned by some solid numbers. However, got my fingers, toes and arms crossed with the implementation of oracle. Never underestimate the disruption upgrading core systems cause, just hope they don't get too distracted by doing business with themselves rather than growing the business with others.

Very true about core banking systems. Kiwibank SAP implementation CoreMod is behind schedule and over budget. Budget blowouts in core banking have a lot of zeroes.

[percy]

Retail Bond issue.....most probably between $100mil and $120 mil.This will add diversity and some strength to HBL's borrowings.
Note 19b.When when talk of 6% unemployed ,we forget that it is 94% full employment.
Same here.98.2% of receivables are not 90 days or impaired.

[Onion]

P.S. The Heartland digital platforms are not as good as the Auusie bank's own digital platforms. So nothing of interest to acquire there either!

I agree Snoopy. While it is good that Heartland are investing in their digital platforms (absolutely needed to reach enough customers without a lot of bricks and mortar), they will never be able to match the IT investment of the bigger banks.

Having recently opened a new Heartland account I would say it wasn't the smoothest digital experience and required two phone calls and the submission of forms three times.

[BlackPeter]

I agree Snoopy. While it is good that Heartland are investing in their digital platforms (absolutely needed to reach enough customers without a lot of bricks and mortar), they will never be able to match the IT investment of the bigger banks.

Having recently opened a new Heartland account I would say it wasn't the smoothest digital experience and required two phone calls and the submission of forms three times.

Just wondering - its not just you reporting a mediocre digital experience with Heartland. On the other hand - they said that they only completed the upgrade of their IT systems in May. Is it possible that we are seeing here just teething problems of a new system or the aftermath of a painful handover, or is the new digital experience really that bad?

Maybe I need to start a trial run myself ;); I hear their on call interest rates are tempting ....

[suse]

I opened an on call account with them in May just as they changed over, and it was a bit nightmarish getting access to internet banking but it was really just a timing issue - although customer service could have been improved as part of that. Nonetheless I am happy that my money is now earning 2.75% instead of next to nothing with ANZ. Comparing the online banking between ANZ and Heartland though is like comparing an apple with a fish.

What was interesting though was how quickly ANZ was on the phone to me to "review" my banking requirements when I took that big chunk of money out. :)

[peat]

Retail Bond issue.....most probably between $100mil and $120 mil.

How are you making this estimation Percy ?

[percy]

How are you making this estimation Percy ?

Undisclosed reliable source.!!

[winner69]

So $78m through Harmoney ....that's good

Harmoney hardly Peer to Peer is it - been hijacked by finance companies ...but who gives a stuff if Heartland have another shopfront

[peat]

Undisclosed reliable source.!!

thank you, I was just wondering whether you were guessing or not.

quite a small issue then....

[winner69]

How are you making this estimation Percy ?

Percy uses the old dog and bone to find these things out

[Beagle]

Just wondering - its not just you reporting a mediocre digital experience with Heartland. On the other hand - they said that they only completed the upgrade of their IT systems in May. Is it possible that we are seeing here just teething problems of a new system or the aftermath of a painful handover, or is the new digital experience really that bad?

Maybe I need to start a trial run myself ;); I hear their on call interest rates are tempting ....

I opened a call account with them very recently, (less than a month ago) and found it a pleasant and pain free experience. I am old fashioned though. Simply filled out the application form I downloaded off their website and took it into Heartland's head office in Newmarket with the appropriate identification and all done. I like doing it in person to see what the staff are like. Very pleasant experience as is earning 2.75% on call instead of 0.1% with the so called Bank of New Zealand..

[BJ1]

Me too, Beagle.

[Beagle]

Me too, Beagle.
Mrs Beagle wants to open an account with them now too. She says the Australian banks are effectively stealing off Kiwi's only giving them 0.1% on call !
(Mr and Mrs Beagle run separate accounts to avoid fighting over dog food.)

[Onion]

I opened a call account with them very recently, (less than a month ago) and found it a pleasant and pain free experience. I am old fashioned though. Simply filled out the application form I downloaded off their website and took it into Heartland's head office in Newmarket with the appropriate identification and all done. I like doing it in person to see what the staff are like. Very pleasant experience as is earning 2.75% on call instead of 0.1% with the so called Bank of New Zealand..

Doing it in person is fine and dandy (and dogs benefit from a walk), but it isn't "digital".


Heartland is an established New Zealand bank working at the forefront of this change. Our digital platforms (such as Open for Business (https://www.openforbusiness.co.nz)) are designed to deliver a better customer experience based on speed and simplicity.

The criticism is for their "digital" service. Heartland accounts should be easily accessible to people that don't live or work within easy strolling distance of a Heartland branch. I couldn't find a list of branches on their web site incidentally so don't know how many there are.

An advantage of Heartland is that they do not have the expense of a large bricks and mortar branch network. But to succeed without a large physical presence the online channel must work well.

PS. Can beagles do digital? After all they don't have digits! :t_down:

[Fatboyj]

Just a little off topic. Is it worth joining SBS Bank in the hope they float some time in the future?

[winner69]

I opened a call account with them very recently, (less than a month ago) and found it a pleasant and pain free experience. I am old fashioned though. Simply filled out the application form I downloaded off their website and took it into Heartland's head office in Newmarket with the appropriate identification and all done. I like doing it in person to see what the staff are like. Very pleasant experience as is earning 2.75% on call instead of 0.1% with the so called Bank of New Zealand..

Did you catch up with Jeff at HQ

[Beagle]

Did you catch up with Jeff at HQ

No but a nice guy Andrew showed me into the boardroom of all places to review my account application. The hound got to sit in the hallowed hall of power !
He told me I was a clever dog, had filled the application form out correctly, gave me a pat and sent me on my way.

[winner69]

No but a nice guy Andrew showed me into the boardroom of all places to review my account application. The hound got to sit in the hallowed hall of power !
He told me I was a clever dog, had filled the application form out correctly, gave me a pat and sent me on my way.

Did he read your microchip as ID and accept your paw print as a signature

[Beagle]

Did he read your microchip as ID and accept your paw print as a signature

LOL too funny :)

[winner69]

LOL too funny :)

Microchip is sort of digital

[winner69]

Good for HBL outlook - homeowners will continue to borrow

just says guidance should mention $70m plus

From interest.co.nz
ANZ CONSUMER CONFIDENCE
The ANZ-Roy Morgan NZ Consumer Confidence Index released today show the index at 126.2, up from 125.4 last month and well above its average of 119. When adjusted for seasonality, the index rose 2 points to its highest level since July 2014. Consumers are feeling wealthier and a net 38% believe that it is a good time to buy major household items. Perceptions on the economic outlook remain buoyant.

[beetills]

Tim Hunter headline in NBR says''Time to release the TSB hound onto the NZX'''
Another bank listing or just an idea.

[percy]

Would be a good idea as they have an excellent reputaion.

[Fatboyj]

Would it be a good idea to be a TSB(and SBS) customer prior to a float? Any idea if they would offer free shares to customers(back in UK the old building societies gave 100 shares per customer at time of float, A&L and Halifax)

[trader_jackson]

Would be a great idea... good for investors and great for the NZX... although can't see it happening anytime soon (ie this year), maybe sometime in the next 5 years.
Would likely give HBL, and others more competition.

[percy]

Would it be a good idea to be a TSB(and SBS) customer prior to a float? Any idea if they would offer free shares to customers(back in UK the old building societies gave 100 shares per customer at time of float, A&L and Halifax)

Not sure whether they would give customers shares or not,but they would surely give customers priority into any float.

[beetills]

How about TSB taking over Heartland,which would become their UDC,while TSB carry on with the traditional bank work.

[Fatboyj]

Not sure whether they would give customers shares or not,but they would surely give customers priority into any float.

Yes I can see that happening. My task for the rest of the day is to open accounts at both. If anyone knows of any other institutes like this please pass on.

[percy]

How about TSB taking over Heartland,which would become their UDC,while TSB carry on with the traditional bank work.

Now that would be interesting.

[winner69]

Love it how fast Jeff and his team work

Last Monday just considering a debt offer

Week later all signed and sealed including Waivers and underway

Shareholders won't be tempted though - better off owning the bank then lending to them

https://www.nzx.com/files/attachments/263797.pdf

[percy]

Love it how fast Jeff and his team work

Last Monday just considering a debt offer

Week later all signed and sealed including Waivers and underway

Shareholders won't be tempted though - better off owning the bank then lending to them

https://www.nzx.com/files/attachments/263797.pdf

Certainly Jeff and the team are very fast on their feet.
$100mil with the right to accept a further $50mil in over subsriptions is pleasing, and will delay them having to raise more capital from shareholders.
And yes shareholder owners will be more than happy owing the bank,while others will welcome lending to the bank.

[Oliver Mander]

Certainly Jeff and the team are very fast on their feet.
$100mil with the right to accept a further $50mil in over subsriptions is pleasing, and will delay them having to raise more capital from shareholders.
And yes shareholder owners will be more than happy owing the bank,while others will welcome lending to the bank.

The big takeaway for me is that the risk of further EPS dilution has just gone down...if the capital need is debt-funded, that preserves existing EPS value in the shares.
That should help share price also...

[ziggy415]

The big takeaway for me is that the risk of further EPS dilution has just gone down...if the capital need is debt-funded, that preserves existing EPS value in the shares.
That should help share price also...
But what are they going to use the money for....day to day lending or something else..matbe in aussie

[percy]

The big takeaway for me is that the risk of further EPS dilution has just gone down...if the capital need is debt-funded, that preserves existing EPS value in the shares.
That should help share price also...

Exactly.Very positive.
Ziggy415.I don't know,however they are enjoying very strong organic growth in all sectors.

[Beagle]

Certainly Jeff and the team are very fast on their feet.
$100mil with the right to accept a further $50mil in over subsriptions is pleasing, and will delay them having to raise more capital from shareholders.
And yes shareholder owners will be more than happy owing the bank,while others will welcome lending to the bank.

You could say that's a win-win situation and investors are well positioned. Some investors don't like shares and will be perfectly happy getting circa 4.5 - 5.0% and see that as an attractive return relative to term deposits.

[Bjauck]

You could say that's a win-win situation and investors are well positioned. Some investors don't like shares and will be perfectly happy getting circa 4.5 - 5.0% and see that as an attractive return relative to term deposits. I am contemplating reducing some shareholdings and am considering investing in HBL notes. If I do, I would have HBL shares, notes as well as fixed interest deposits! Good company that it may be, I would have to be careful not to become Over-exposed...

[fish]

I am contemplating reducing some shareholdings and am considering investing in HBL notes. If I do, I would have HBL shares, notes as well as fixed interest deposits! Good company that it may be, I would have to be careful not to become Over-exposed...
If doing so reduce your holdings in the shares.
When I retire this would make sense

[winner69]

But what are they going to use the money for....day to day lending or something else..matbe in aussie

Lending, lending and more lending

Strong growth in reverse mortgages need lots of cash up front - some years before the get any cash back eh

[fish]

Lending, lending and more lending

Strong growth in reverse mortgages need lots of cash up front - some years before the get any cash back eh

Hope there is the same growth in home loans-I notice their rates are high so with low expenses should be good cashflow

[janner]

$1.93. Not looking good for the DRP.

I suppose I will just have to grin and bear it ...

[RTM]

$1.93. Not looking good for the DRP.

I suppose I will just have to grin and bear it ...

Pleased I opted out....they were getting to be to big a proportion of my portfolio.... >15% !
There are some tough choices and big problems with this company !;)

[Puriri Pete]

$1bn market cap. - a nice milestone.

[Beagle]

Heartland complete book build and raises the full $150m at the minimum guaranteed rate of 4.50%. Significant oversubscriptions so obviously they could have raised even more which augers well for the ongoing funding of the lucrative reverse equity mortgage book.


HBL
29/08/2017 15:57
OFFER
NOT PRICE SENSITIVE
REL: 1557 HRS Heartland Bank Limited

OFFER: HBL: Heartland sets offer size and rate on retail note offer

Heartland Bank Limited sets offer size and rate on retail note offer
Date 29 August 2017
Release Immediate

Heartland Bank Limited ("Issuer") today announced that it had successfully
closed the bookbuild for the five year, unsecured, unsubordinated, medium
term, fixed rate notes ("Notes" or "Offer"). The Offer size has been set at
$150 million. The Issuer has decided to proceed with the full offer amount
following the successful bookbuild, which saw a significant degree of
oversubscription.

The Offer opens on 30 August 2017 and is expected to close on 18 September
2017. There is no public pool available.

The interest rate for the Notes has been set at 4.50% p.a. This reflects a
margin of 1.88% p.a. over the underlying five year swap rate. The Notes will
be issued on 21 September 2017 and will mature on 21 September 2022. The
Notes are expected to be quoted on the NZX Debt Market.

The Notes are expected to have a credit rating of BBB from Fitch Ratings.

The full details of the offer are contained in the Limited Disclose Document
and in the Register Entry for the Offer, both available at
https://www.companiesoffice.govt.nz/disclose. Summarised terms of the Offer
are contained in the updated Terms Sheet attached.

[winner69]

$1bn market cap. - a nice milestone.


pretty good for a company whose book value is $570m

[peat]

Heartland complete book build and raises the full $150m at the minimum guaranteed rate of 4.50%. Significant oversubscriptions so obviously they could have raised even more which augers well for the ongoing funding of the lucrative reverse equity mortgage book.

i heard 3x oversubscribed. dont know how many I got yet.......

[percy]

i heard 3x oversubscribed. dont know how many I got yet.......

Very pleasing for shareholders that bond investors rate Heartland Bank so highly.

[Beagle]

i heard 3x oversubscribed. dont know how many I got yet.......

Wow impressive stuff. No problem funding the huge ongoing growth in the high margin low risk lucrative reverse mortgage book then.
4.5% great for shareholders. I'm sure this won't be the last issue of this type by HBL.

[777]

Is it that great though

4.5% less 33c tax is a net return of 3.015%

Put it is the bank for 5 year Term Fund (PIE)

4.2% less 28c is a net return of 3.024% (ASB)
4.3% less 28c is a net return of 3.096 (ANZ)

[iceman]

Is it that great though

4.5% less 33c tax is a net return of 3.015%

Put it is the bank for 5 year Term Fund (PIE)

4.2% less 28c is a net return of 3.024% (ASB)
4.3% less 28c is a net return of 3.096 (ANZ)

Yes great for us SH that HBL could fund its big growth so easily and relatively cheaply :-)