HGH - Heartland Group Holdings

[Muse]

Good work FM but Heartland ratios might be a bit light

I reckon Heartland P/B is 1.59 at the moment -- like 210/132

Calanderisation?

We are talking different time periods.

HGH's spot marketcap divided by its most recent (31Dec21) book is 1.59 (being $1.239b mcap/0.778b book).

However the analysis I've done uses forward consensus book estimates rather than historical / last actual. It doesn't really matter if you use forward or last actual as long as everything is consistent and the point of the exercise is to demonstrate the classic pairing of P/B and ROE and where HGH sits within the line of best fit. There may be some benefit to using forward estimates as expectations of future growth can clearly have an impact on valuation multiples.


The rest comes down to calendarisation. Heartland trades at 1.39 FY22 book and 1.27 FY23 book. HGH operates a June financial year where most of its peers are September, so I did 1 yr forward calalandarisation calc for all to align balance dates. IE, for heartland, (30% x FY22) + (70% x FY23). same for all the others. Calendarisation is pretty standard when doing comps with a wide range of balance dates.

That's why I labeled it '1 year forward' multiples (and calendarised). Multiples lose some of their utility if the time period they correspond to isn't provided.

Consensus I'm using consistent with what is coming out of marketscreener. It also shows 1.59 on a historic basis.
https://www.marketscreener.com/quote/stock/HEARTLAND-GROUP-HOLDINGS-47041144/financials/

[Rawz]

Good stuff FM. Love your work

[Beagle]

I don't know why Forbar have their nickers in such a twist re Heartland. Sure it's price to book is at a slight premium to most of the Australian banks, but its well known that the single biggest driver of price to book is return on equity, where Heartland shines. It's PE is below its peers and has a superior dividend yield.

See heartland valuation (red dot) vs. its Australian peers below:


If anything the analysis suggests Heartland is undervalued relative to its peers (heartland consistently below trendline on a price to book and PE basis). I'd say some discount is warranted given Heartlands smaller size, its evolution from an amalgamation of non bank lenders and eventual registered bank status, and mix of receivables but I certainly don't agree with Forbar that it is overvalued relative to its peers.

They have consistently been negative on HGH and they have consistently been wrong. I stopped dealing with Forbar over a decade ago because of the poor caliber of their analysis. Input flawed assumptions into any DCF model and your get garbage answers coming out. The answers are only as good as the intellect of the analyst doing the work. Jarden have the best analysts.

[percy]

With an excellent ROE ,a huge NIM,plus fully imputed divies, HGH is my choice of the banks to invest in.

[Beagle]

With an excellent ROE ,a huge NIM,plus fully imputed divies, HGH is my choice of the banks to invest in.

Agreed + solid ongoing growth in earnings and dividends from the Reverse mortgages. Discover Freedom https://www.heartland.co.nz/reverse-mortgage

[winner69]

Thanks FM for explaining in more detail my query.

So if HGH spot P/B today is 1.59 and marketscreener forecasts come true and HGH retains its 1.59 P/B (deserves to because of its high ROE) then sometime in a calendarised F23 year the HGH share price will reach $2.62

That's a 24% increase in share price in next year and a bit ...PLUS 8% pa divie yield ..... no wonder Beagle is buying more and more

[alokdhir]

Thanks FM for explaining in more detail my query.

So if HGH spot P/B today is 1.59 and marketscreener forecasts come true and HGH retains its 1.59 P/B (deserves to because of its high ROE) then sometime in a calendarised F23 year the HGH share price will reach $2.62

That's a 24% increase in share price in next year and a bit ...PLUS 8% pa divie yield ..... no wonder Beagle is buying more and more

Beagle bought lots of OCA too ...not bad buy but market may not think that way ...Hopefully HGH is more appealing to more market participants ..

I wonder when it reached $ 2.59 on retail exuberance over Broker's picks publicity what did holders do ...trim positions as it got overvalued or kept holding for the original purpose of Dividends ?

[Rawz]

Beagle bought lots of OCA too ...not bad buy but market may not think that way ...Hopefully HGH is more appealing to more market participants ..

I wonder when it reached $ 2.59 on retail exuberance over Broker's picks publicity what did holders do ...trim positions as it got overvalued or kept holding for the original purpose of Dividends ?

Traders trimmed and long term investors went for a swim and read the news paper

[Bjauck]

Traders trimmed and long term investors went for a swim and read the news paper It would result in some very soggy paper? Reading the news too much makes for such depressing reading at the moment. It could lead to stocking up on gold stocks, rare metals miners and fixed interest.

[percy]

Thanks FM for explaining in more detail my query.

So if HGH spot P/B today is 1.59 and marketscreener forecasts come true and HGH retains its 1.59 P/B (deserves to because of its high ROE) then sometime in a calendarised F23 year the HGH share price will reach $2.62

That's a 24% increase in share price in next year and a bit ...PLUS 8% pa divie yield ..... no wonder Beagle is buying more and more

.
So not just price/book and ROE but NIM as well.
HGH's NIM is far superior to the other banks,by a country mile,or two.!!

[winner69]

.
So not just price/book and ROE but NIM as well.
HGH's NIM is far superior to the other banks,by a country mile,or two.!!

And Harmoney has a far superior NIM than Heartland

[percy]

And Harmoney has a far superior NIM than Heartland

As does TRA.
However neither have RELs,which are a fantastic secure form of lending.

[Muse]

As does TRA.
However neither have RELs,which are a fantastic secure form of lending.

yes and what a long term demographic boom behind it. It's a nascent industry here, filled to the brim with asset rich cash poor homeowners rapidly reaching their golden years where it makes sense to do a reverse mortgage. Reverse mortgages are big businesses in other parts of the world where NZ lags, particularly the United States.

[Beagle]

Sssshhhh...you guys are on to it but lets keep it quiet and hope HGH gets down to $1.94 so they're on a 10% gross prospective yield for FY23 and we can all back the truck and trailer up.

[Rawz]

yes and what a long term demographic boom behind it. It's a nascent industry here, filled to the brim with asset rich cash poor homeowners rapidly reaching their golden years where it makes sense to do a reverse mortgage. Reverse mortgages are big businesses in other parts of the world where NZ lags, particularly the United States.

I agree. I was talking to a mate the other day who's mum needed $100k to do up the kitchen and provide other comforts.
Freehold property worth $1.4m. Went to ANZ bank and asked for interest only. ANZ wanted to know how they would pay back the loan. Son said the intention was to only pay the interest only and why would they pay principal..? ANZ couldnt get their heads around the deal.

Went to HGH who approved a reverse mortgage same day. Only problem was the rate was in the 6% range.

HGH making heaps on this product and the main banks don't want to compete. Amazing situation

[Muse]

does anyone happen to have any lending statistics on reverse mortgage/equity release mortgages for NZ and AU? Like a time series showing total lending by year?

[percy]

does anyone happen to have any lending statistics on reverse mortgage/equity release mortgages for NZ and AU? Like a time series showing total lending by year?

Ask Chris Flood.
chris.flood@heartland.co.nz

[pierre]

I wonder when it reached $ 2.59 on retail exuberance over Broker's picks publicity what did holders do ...trim positions as it got overvalued or kept holding for the original purpose of Dividends ?

Very happy long term holder here.

Topped up 18 months ago and have an average holding cost of ~$1.30.

Looking forward to receiving a very nice 5.5 cps dividend in the bank tomorrow, an even larger one in September (probably at least 7.0cps) - and so on! Gross dividend yield on cost of ~13%. A very nice contribution to my now completely passive income.

HGH is 17% of my portfolio as at today and like Percy, I ain't selling any now or in the foreseeable future.

[Rawz]

Very happy long term holder here.

Topped up 18 months ago and have an average holding cost of ~$1.30.

Looking forward to receiving a very nice 5.5 cps dividend in the bank tomorrow, an even larger one in September (probably at least 7.0cps) - and so on! Gross dividend yield on cost of ~13%. A very nice contribution to my now completely passive income.

HGH is 17% of my portfolio as at today and like Percy, I ain't selling any now or in the foreseeable future.

Good stuff. 13% yield on investment is gold!

[newbieinvestor]

Sssshhhh...you guys are on to it but lets keep it quiet and hope HGH gets down to $1.94 so they're on a 10% gross prospective yield for FY23 and we can all back the truck and trailer up.


Hmmm...not sure if it will got down to $1.94... seems to have gone back to $2.10+....

[pierre]

Good stuff. 13% yield on investment is gold!
That lovely divvie just landed in the bank account - and the SP up 5c to 215 atm. All is good.

[alokdhir]

Whats the buzz on HGH ...almost 6% up on low volumes as no sellers ...

[Grimy]

Great company, good results. Why would you sell?

[Rawz]

Whats the buzz on HGH ...almost 6% up on low volumes as no sellers ...

Didnt you hear? All the worries of the markets are over and there is now a mad rush back into equities.
Those poor sods that went into cash are tripping over themselves trying to buy back in before inflation taxes them

HGH will be at $2.60 by the end of the year

[Beagle]

Hmmm...not sure if it will got down to $1.94... seems to have gone back to $2.10+....

Agreed. $1.94 was always a pipe dream. Bought all I could get on the open this morning at $2.18. 8.9% gross yield for FY23 at that price assuming 14 cps fully imputed dividends = 19.44 cps gross plus this will grow nicely in the years ahead.

US financials up nicely overnight....can't think of a better investment on the NZX at present. Low risk reverse mortgage lending will grow very strongly in the years ahead.

[alokdhir]

Didnt you hear? All the worries of the markets are over and there is now a mad rush back into equities.
Those poor sods that went into cash are tripping over themselves trying to buy back in before inflation taxes them

HGH will be at $2.60 by the end of the year

Like your positivity ...But why only mad rush for HGH ...I know it was trading below its intrinsic value at present ...Now its almost fairly priced in just one day ...I agree with all here ...its a stock to hold super long term ...if they keep doing what they have been doing then all good for it ahead ....long path of growth and dividends ...best inflation hedge

[percy]

Like your positivity ...But why only mad rush for HGH ...I know it was trading below its intrinsic value at present ...Now its almost fairly priced in just one day ...I agree with all here ...its a stock to hold super long term ...if they keep doing what they have been doing then all good for it ahead ....long path of growth and dividends ...best inflation hedge

Bit like a Briscoes one day sale.?

[percy]

Agreed. $1.94 was always a pipe dream. Bought all I could get on the open this morning at $2.18. 8.9% gross yield for FY23 at that price assuming 14 cps fully imputed dividends = 19.44 cps gross plus this will grow nicely in the years ahead.

US financials up nicely overnight....can't think of a better investment on the NZX at present. Low risk reverse mortgage lending will grow very strongly in the years ahead.

Great buying.

[percy]

https://business.scoop.co.nz/2022/03/21/heartland-home-loans-highlights-big-savings-and-commits-to-decisioning-applications-within-48-hours-of-receiving-info/#more-221591

[thegreatestben]

I went through an application again recently and they ask for current online banking log in details.

Not in a million years!

[Ferg]

I went through an application again recently and they ask for current online banking log in details.

Not in a million years!

I'm with you on that one...as in that will NEVER happen on my watch. But I am curious how a financial institution can ask for your ID and password knowing that is in breach of the T&C's of the other financial institution?

[thegreatestben]

Same, I’ll happily crank out my statements in full detail for any period they want but I’m not giving them the keys to door.

If this is becoming a requirement I’d suggest banks should look to create guest log ins that we can control access of with audit logs and some kind of assurance those using the log in have approval.

[Ferg]

Same, I’ll happily crank out my statements in full detail for any period they want but I’m not giving them the keys to door.

If this is becoming a requirement I’d suggest banks should look to create guest log ins that we can control access of with audit logs and some kind of assurance those using the log in have approval.

Same plus you raise a good point/solution. I also suggest we should know the full name, home address, position, employment tenure, work and personal e-mail addresses, contact numbers, date of birth and criminal record for all persons who wants such audit access as set up by the user per your suggestion. It might sound over the top, but I would want to know who is poking around my financial records and their trustworthiness. I don't see that an unreasonable in light of what is being requested by the lender, which IMO is equally invasive.

P.S. And an indemnity against disclosing any personal information and/or any financial loss plus costs.

[Rawz]

Take your tin foil hats off..

Anyone that has ever worked for a financier will tell you that you are just boring numbers on a screen and they really don’t care much for you or your personal information.

They want to be able to lend a much money as they can to you whilst being compliant under the relevant legislation

[thegreatestben]

That's a pretty rediculous argument, "All care and no responsibility".
How many times a year do you see news stories about people in positions of trust who end up taking advantage over time.

Many banks also offer document vaults as part of their internet banking service, I don't personally make use of these but some may and it could contain highly sensitive information.
No-one would have any sympathy for any "victims" if it was determined their credentials were shared against the recommendations or policy of your bank.

I'd say there would be a good proportion of applicants who don't want to be sharing this info either but feel they have no choice, it also flies in the face of all the work done in this industry to educate the less tech savvy.

Obviously I'm not against sharing the information, in fact I'm very pro-enablement for data sharing but there has to be safeguards such as read only access.

[percy]

So I give my banking details to another financial business so as I may borrow money from them.
Then one of their staff use my banking details to help themselves to my funds.
What would the out come be.?
I would guess the bank whose employee stole my funds would pretty quickly want to reimburse me.
The law would see the thief would spend a good amount of time in jail.
Lets face it all banks have a lot more funds than I do,so I do not see I would be out of pocket.
The business asking for my banking details would surely have to guarantee i would not suffer any losses from giving them my banking details.

[Rawz]

So I give my banking details to another financial business so as I may borrow money from them.
Then one of their staff use my banking details to help themselves to my funds.
What would the out come be.?
I would guess the bank whose employee stole my funds would pretty quickly want to reimburse me.
The law would see the thief would spend a good amount of time in jail.
Lets face it all banks have a lot more funds than I do,so I do not see I would be out of pocket.
The business asking for my banking details would surely have to guarantee i would not suffer any losses from giving them my banking details.

Exactly..

People happy for bank 1 to have all their info and people trust bank 1 100%.
Bank 2 asks for the info and suddenly there is a huge amount of risk from bank 2 that apparently doesn't exist at bank 1

[676767]

So I give my banking details to another financial business so as I may borrow money from them.
Then one of their staff use my banking details to help themselves to my funds.
What would the out come be.?
I would guess the bank whose employee stole my funds would pretty quickly want to reimburse me.
The law would see the thief would spend a good amount of time in jail.
Lets face it all banks have a lot more funds than I do,so I do not see I would be out of pocket.
The business asking for my banking details would surely have to guarantee i would not suffer any losses from giving them my banking details.

The problem is that there isn't a unique identifier saying someone from that bank took your details. From your current banks perspective someone logged in with your password and took your funds and its your responsibility to be in charge of your accounts login details. Most banks also specifically state in their T&C's that any loss as a result of someone else having access to your password, they are not responsible for

NZ is behind the times with banking API's, Most of the banks in the UK now have fantastic interbank functionality and allow for finance providers and proper budgeting apps to have "Read-only" access your data (with your permission)

There is no reason Heartland needs full access to your bank account to give you lending, its incredibly insecure in today's world...

[thegreatestben]

The business asking for my banking details would surely have to guarantee i would not suffer any losses from giving them my banking details.

Guess most of your points are subjective depending on individual perspective, but to this point quoted I couldn't see anythign of the sort from HGH on the application when it asked for the details which is red flag and should be to anyone initially.

[mike2020]

I don't believe anything is secure these days. The bank recently sent me a new credit card because mine had been compromised but I'm sure it wasn't my fault and I saw no clue as to what actually happened. I don't shop online much either just the majors TM and occasionally Briscoes. Another guy with my email address keeps asking for bitcoin otherwise he's going to release vids of me ****ing on cam. I'm not sure which bank he works for but he's obviously never dealt with me personally because he feels the need to teach me about bitcoin along the way. Should I tell him it's an unstable investment with no intrinsic value?
I guess the point is the banks save loads with internet tech so they have been prepared to cover losses as far as I've been aware.

[percy]

I don't believe anything is secure these days. The bank recently sent me a new credit card because mine had been compromised but I'm sure it wasn't my fault and I saw no clue as to what actually happened. I don't shop online much either just the majors TM and occasionally Briscoes. Another guy with my email address keeps asking for bitcoin otherwise he's going to release vids of me ****ing on cam. I'm not sure which bank he works for but he's obviously never dealt with me personally because he feels the need to teach me about bitcoin along the way. Should I tell him it's an unstable investment with no intrinsic value?
I guess the point is the banks save loads with internet tech so they have been prepared to cover losses as far as I've been aware.

Great to know I am not the only one being asked to send Bitcoin to stop vids of me ......ing being released.
Pity I can not contact him, as I would pay him double to release them.....
Rotten sod has so far not released them,[as far as I know]......lol.

[dobby41]

Great to know I am not the only one being asked to send Bitcoin to stop vids of me ......ing being released.
Pity I can not contact him, as I would pay him double to release them.....
Rotten sod has so far not released them,[as far as I know]......lol.

I get them too even without a camera.

[Beagle]

Is this the HGH thread or the thread where people humiliate themselves lol

[mike2020]

Its probably both. Ive been emailed a few times and I dont even watch porn. Public service announcement.

[Muse]

I get them too even without a camera.

Well this is ruining my self esteem. I turn my webcam on, turn my firewall off, and stretch out in bed everynight at a time I publicise on the darkweb - and never once has a hacker stayed to record.

Starting to hurt my feelings.

[Beagle]

Well this is ruining my self esteem. I turn my webcam on, turn my firewall off, and stretch out in bed everynight at a time I publicise on the darkweb - and never once has a hacker stayed to record.

Starting to hurt my feelings.

:lol: :lol:

[dabsman]

This is funnier than talk about boring old HGH making me rich

[mike2020]

Bereft of inspiration there FM. Have you read about the Russian kid that got 10s of millions for her parents blog about her road to recovery from cancer? Also has her own brands and other websites now. Id suggest you start with an only fans page, people have all sorts of cravings waiting to be sated.

[alokdhir]

Well this is ruining my self esteem. I turn my webcam on, turn my firewall off, and stretch out in bed everynight at a time I publicise on the darkweb - and never once has a hacker stayed to record.

Starting to hurt my feelings.

Wow ...seeing so many people getting that email of video release has totally ruined my mood ...I thought I maybe the only few they thought to be fit enough to practice that kind of workouts ...lol

But they do are getting smarter and they try to be as convincing as possible ....

[Muse]

Bereft of inspiration there FM. Have you read about the Russian kid that got 10s of millions for her parents blog about her road to recovery from cancer? Also has her own brands and other websites now. Id suggest you start with an only fans page, people have all sorts of cravings waiting to be sated.

nice idea.

I'll set up an only fans page- but to stay on topic - i'll only accept heartland shares for payment.

[mike2020]

Way better than Bitcoin. You could include a link to HMY and drum us up some business.

[percy]

https://www.nzx.com/announcements/389893

Looks interesting.

[iceman]

https://www.nzx.com/announcements/389893

Looks interesting.

That's an interesting development !

[Rawz]

Yes, best word to describe is definitely- interesting!

Paying 13x earnings

This is a good way for HGH to get into asset finance in Aus. Provide cashflow lending to the farmer for their stock then fund the tractor and ute once they get the profile and payment history going

This excellent GARP stock can continue on its run for another decade by expanding in Aus

[nztx]

https://www.nzx.com/announcements/389893

Heartland to acquire livestock business in Australia


Minnow Alfred (ALF) are in the game of financing moomoos & sheeps too - aren't they ? ;)

[Beagle]

Yes, best word to describe is definitely- interesting!

Paying 13x earnings

This is a good way for HGH to get into asset finance in Aus. Provide cashflow lending to the farmer for their stock then fund the tractor and ute once they get the profile and payment history going

This excellent GARP stock can continue on its run for another decade by expanding in Aus

I am sure you meant it has many decades of growth ahead of it. Yes that's an interesting acquisition and gives them a foothold for expansion with rural lending in Australia. HGH itself has a current year PE of 14.0 (eps of 16 cps forecast) and when one considers the steady growth and excellent net interest margins they enjoy as well as strong growth from reverse equity mortgages this looks like a compelling hold and is indeed a fine example of a classic GARP stock (Growth at a reasonable price).

[nztx]

Wonder if HGH have thoughts on taking out ALF ? ;)

[winner69]

just as well this Stockco only lends to asset rich farmers and don't get involved in the riff raff that we hear about that are driven off their farms in tough times by those distardly big Aussie banks

[winner69]

Did OK buying PGG Wrightson Finance 10 years ago

Interesting latest move

[winner69]

Say $12m extra profit = 2 cents per share

Should add 25 cents or more to share price in due course

[winner69]

Heartland not buying Stockco NZ?

This article says Heartland been funding Stockco NZ -- Heartland Bank also understands and has a relationship with StockCo through financing the operations of StockCo New Zealand for over 10 years.


https://www.beefcentral.com/news/nz-banking-group-to-buy-stockco-australia/

[Beagle]

Heartland not buying Stockco NZ?

This article says Heartland been funding Stockco NZ -- Heartland Bank also understands and has a relationship with StockCo through financing the operations of StockCo New Zealand for over 10 years.


https://www.beefcentral.com/news/nz-banking-group-to-buy-stockco-australia/

Thanks for the link mate. This bit is really interesting The transaction is expected to contribute additional annual net profit after tax of A$10 million to A$12 million, before any ongoing cost of acquisition debt funding. At this stage, given timing of the acquisition and the transaction costs, there is no change to Heartland’s market guidance for the financial year ending 30 June 2022 (FY2022).

Suppose they fund that acquisition at 4% before tax, about 3% after tax that suggests a funding cost of about $A5m and this acquisition could be earnings accretive by between $A5m - $A7M per annum, say $A6m = approx N.Z$6.4m = ~ 0.9 cps annual earnings. Applying HGH's very reasonable current year PE of 14 to that this suggests this is value accretive to HGH to the tune of 12.6 cps.
Upgraded my view on HGH to BUY on the back on this acquisition.

[winner69]

Thanks for the link mate. This bit is really interesting The transaction is expected to contribute additional annual net profit after tax of A$10 million to A$12 million, before any ongoing cost of acquisition debt funding. At this stage, given timing of the acquisition and the transaction costs, there is no change to Heartland’s market guidance for the financial year ending 30 June 2022 (FY2022).

Suppose they fund that acquisition at 4% before tax, about 3% after tax that suggests a funding cost of about $A5m and this acquisition could be earnings accretive by between $A5m - $A7M per annum, say $A6m = approx N.Z$6.4m = ~ 0.9 cps annual earnings. Applying HGH's very reasonable current year PE of 14 to that this suggests this is value accretive to HGH to the tune of 12.6 cps.
Upgraded my view on HGH to BUY on the back on this acquisition.

My guess of 2 cents and 25 cents plus to share price a bit wrong eh

[Beagle]

My guess of 2 cents and 25 cents plus to share price a bit wrong eh

Sorry mate, I wasn't trying to undermine you, I didn't see your post before I posted. Could be a bit more depending on the price of funding and how it grows going forward and any operational synergies they can extract. Maybe ~ 20 cents extra value to HGH is not out of the question ?
Any way you slice and dice this its meaningfully earnings and value accretive for HGH shareholders.

[winner69]

Sorry mate, I wasn't trying to undermine you, I didn't see your post before I posted. Could be a bit more depending on the price of funding and how it grows going forward and any operational synergies they can extract. Maybe ~ 20 cents extra value to HGH is not out of the question ?

Whether its an extra 10 cents or 20 cents or maybe even 30 cents it is going to add a reasonable chunk to HGH share price

And Jeff will ensure its a success

[Waltzing]

"And Jeff will ensure its a success"

is that before or after a BIG DRY event....

suppose there is always insurance ...

why not buy an insurance firm?

Livestock?

oh dear ....

https://nullarborroadhouse.com.au/creatures-middle-nowhere-wildlife-nullarbor-plain/

[percy]

"And Jeff will ensure its a success"

is that before or after a BIG DRY event....

suppose there is always insurance ...

why not buy an insurance firm?

Livestock?

oh dear ....

https://nullarborroadhouse.com.au/creatures-middle-nowhere-wildlife-nullarbor-plain/

About StockCo Australia
StockCo Australia was founded in Australia in 2014, but has origins in New Zealand dating back to
1995. The company provides livestock finance for cattle and sheep farmers across Australia,
primarily through its direct channel.
Like Heartland’s livestock lending solutions in New Zealand, StockCo Australia provides cashflow
solutions to customers who are typically asset rich, allowing them to purchase livestock, maximise
returns, and run their business more effectively.

[Waltzing]

" typically asset rich"

the economic farm surveys in NZ were a great stat report in the early 80's . Havnt read the Aussi version if there is one still published on the state of Aussi farming.

suppose one should seek it out and come up to speed.

Certainly HGH has performed. Sadly the PGC days have always stayed in the mind but not MR P's.

MR P has thus profited.

[Beagle]

Whether its an extra 10 cents or 20 cents or maybe even 30 cents it is going to add a reasonable chunk to HGH share price

And Jeff will ensure its a success

No doubt we're both already very well positioned :t_up:

[Beagle]

Whether its an extra 10 cents or 20 cents or maybe even 30 cents it is going to add a reasonable chunk to HGH share price

And Jeff will ensure its a success

Managed to "hound up" a few more at the close today at $2.25. In the circumstances, what a gift !

[newbieinvestor]

Managed to "hound up" a few more at the close today at $2.25. In the circumstances, what a gift !


Dont you think Mr B it might fall a bit more .... :)..

[Beagle]

Up down or sideways the acquisition was about 1 cps eps accretive which has implications for enhanced future dividends. I have them on a FY23 gross forecasted yield of 8.5% and they have a long track record of steady dividend growth. To an income investor I think that's very attractive.

In answer to your tongue in cheek comment, I have a bid for more in the market at a slightly lower price so ask me if I care if they do drop a bit more :D

[percy]

Up down or sideways the acquisition was about 1 cps eps accretive which has implications for enhanced future dividends. I have them on a FY23 gross forecasted yield of 8.5% and they have a long track record of steady dividend growth. To an income investor I think that's very attractive.

In answer to your tongue in cheek comment, I have a bid for more in the market at a slightly lower price so ask me if I care if they do drop a bit more :D

Do not think you will get your 200 at $2.13............................................. .........lol.

[Beagle]

LOL I might get my 1 share as part of the herd @ $2.20 though lol

[newbieinvestor]

LOL I might get my 1 share as part of the herd @ $2.20 though lol


Good Luck :t_up: with that ...

So probably I missed some of the context as to whats changed with HGH from when it was at 2.07 and now at 2.26 ..... should refer the posts...

[thegreatestben]

Good Luck :t_up: with that ...

So probably I missed some of the context as to whats changed with HGH from when it was at 2.07 and now at 2.26 ..... should refer the posts...

Only notable update - https://www.nzx.com/announcements/389893

[newbieinvestor]

Only notable update - https://www.nzx.com/announcements/389893


Thanks! thegreatestben (https://www.sharetrader.co.nz/member.php?18074-thegreatestben) :t_up: Kiwi firms doing more business across the ditch..Interesting move\diversification!

[Beagle]

New Chief risk officer looks highly credentialed. Excellent hire. https://www.nzx.com/announcements/390180

[winner69]

New Chief risk officer looks highly credentialed. Excellent hire. https://www.nzx.com/announcements/390180

RBNZ eh .....must be one of the last pre-Orr staff to leave that place ..... hmmm

[sb9]

Strong moves today, could be on the way to 2.50 soon..

[alokdhir]

Strong moves today, could be on the way to 2.50 soon..

Looks like Forbar analyst have read the W69 and Mr B exchange here after new Australian acquisition announcement ...they both agreed to 1 cps addition to bottom line thus giving it 15-20 cents push .

$ 2.60 target now stands at $ 2.75 ....:t_up:

[winner69]

Looks like Forbar analyst have read the W69 and Mr B exchange here after new Australian acquisition announcement ...they both agreed to 1 cps addition to bottom line thus giving it 15-20 cents push .

$ 2.60 target now stands at $ 2.75 ....:t_up:

Did they comment that Jeff always does what he says he will do ....without fail

[alokdhir]

Did they comment that Jeff always does what he says he will do ....without fail

Why u think HGH is my third largest stock ? As W69 vouches for Jeff ...Have more faith in your faith in him :p

[thegreatestben]

Jeff's my #1, very happy with HGH's performance and future prospects.

[Beagle]

Looks like Forbar analyst have read the W69 and Mr B exchange here after new Australian acquisition announcement ...they both agreed to 1 cps addition to bottom line thus giving it 15-20 cents push .

$ 2.60 target now stands at $ 2.75 ....:t_up:

You can always count on Winner and I to take a "dogged approach" to finding opportunities ;)

I don't fancy my chances of nicking any more at $2.25

[percy]

https://business.scoop.co.nz/2022/04/07/heartland-hits-milestone-of-helping-20000-customers-retire-more-comfortably/#more-222116

[thegreatestben]

Good article, I like having both sides of the retiree coin covered via HGH and OCA :)

[percy]

Good article, I like having both sides of the retiree coin covered via HGH and OCA :)

Are you Gregg Tomlinson.?....................................... .....................lol

[thegreatestben]

Gregg Jr. Probably a few less zeros on my shareholding.

[percy]

https://sendy.tarawera.co.nz/l/J6oLVth2f3f6IXNYvUBQEg/CQgHB892pvhawH29JJkUT892zw/dTBX5J2y4EB5763aH8XQPH7A

[Snow Leopard]

https://sendy.tarawera.co.nz/l/J6oLVth2f3f6IXNYvUBQEg/CQgHB892pvhawH29JJkUT892zw/dTBX5J2y4EB5763aH8XQPH7A

You signed up for the ShareTrader AM Update too? :t_up:

[percy]

You signed up for the ShareTrader AM Update too? :t_up:

Have enjoyed it for some time now.
Excellent.

[newbieinvestor]

You can always count on Winner and I to take a "dogged approach" to finding opportunities ;)

I don't fancy my chances of nicking any more at $2.25

Yeah seems to be rising despite ATM & FPH falling ...remains to be seen if it will got back to 2.25....

[winner69]

Heartland raised their mortgage and other lending rates yet post OCR going up?

[stoploss]

Heartland raised their mortgage and other lending rates yet post OCR going up?
ANZ did within hours , Westpac have left them all unchanged apart from the floating rates obviously .

[Beagle]

Heartland competing harder for deposit money now. Just noticed on www.interest.co.nz 1 year term deposit now 3.0%
90 day Notice saver 2.50%, 32 day notice saver 1.9%.

[percy]

Heartland competing harder for deposit money now. Just noticed on www.interest.co.nz 1 year term deposit now 3.0%
90 day Notice saver 2.50%, 32 day notice saver 1.9%.

Always positive seeing HGH paying more for their deposits.
Leads to a higher NIM .

[Muse]

Always positive seeing HGH paying more for their deposits.
Leads to a higher NIM .

Thought this article may interest you heartland followers
https://www.afr.com/companies/financial-services/the-boon-to-the-banks-from-rising-interest-rates-20220323-p5a74o

It is AFR paywalled. But, once you click, reload the page by hitting the little circular arrow by the URL and then very very quickly hitting Esc. That stops the script from loading, and you can view the article. You may have to do it like 5 times before it works until you become a seasoned pro, or just get a subscription as I eventually did. Or you can hit the x button on your phone while it is loading does the same thing.

Jest of the article is that deposits aren't as sensitive to interest rate rises as other wholesale methods of funding, and banks may be able to claw back some of their lost marketshare from fintechs who will have higher costs of funds going forward.

[LoungeLizzard]

Thought this article may interest you heartland followers
https://www.afr.com/companies/financial-services/the-boon-to-the-banks-from-rising-interest-rates-20220323-p5a74o

It is AFR paywalled. But, once you click, reload the page by hitting the little circular arrow by the URL and then very very quickly hitting Esc. That stops the script from loading, and you can view the article. You may have to do it like 5 times before it works until you become a seasoned pro, or just get a subscription as I eventually did. Or you can hit the x button on your phone while it is loading does the same thing.

Jest of the article is that deposits aren't as sensitive to interest rate rises as other wholesale methods of funding, and banks may be able to claw back some of their lost marketshare from fintechs who will have higher costs of funds going forward.

Useful tip re. getting round the paywall. Only took me two attempts!

[ralph]

Yep well done moose ,took me six times though I was nearly ready for giving up on it .

[clearasmud]

Thought this article may interest you heartland followers
https://www.afr.com/companies/financial-services/the-boon-to-the-banks-from-rising-interest-rates-20220323-p5a74o

It is AFR paywalled. But, once you click, reload the page by hitting the little circular arrow by the URL and then very very quickly hitting Esc. That stops the script from loading, and you can view the article. You may have to do it like 5 times before it works until you become a seasoned pro, or just get a subscription as I eventually did. Or you can hit the x button on your phone while it is loading does the same thing.

Jest of the article is that deposits aren't as sensitive to interest rate rises as other wholesale methods of funding, and banks may be able to claw back some of their lost marketshare from fintechs who will have higher costs of funds going forward.
Thanks for the paywall tip Moose!

[Rawz]

I finally got it to work after 2 days and 20 try’s lol

[percy]

I finally got it to work after 2 days and 20 try’s lol

Beat you hands down..
Just two days and about 10 try's.
Absolutely amazed myself,when it worked for me..lol

[clearasmud]

Beat you hands down..
Just two days and about 10 try's.
Absolutely amazed myself,when it worked for me..lol

1st try. Did I just get lucky?

[percy]

1st try. Did i just get lucky?

awsome........................................

[Grimy]

1st try. Did I just get lucky?

Same here. Just have to hit refresh and ESC at pretty much the same time.

[Snow Leopard]

So, do all your bludgers think that [the article proposition] is good for Heartland or not?

[pierre]

I've just received an email from Heartland Bank advising that the interest rate on Call deposits is increasing next week from 1.05% to $1.50% p.a.

I'm very much happier owning part of the bank than having cash on deposit with them.

Heartland does look after a bit of spare dosh for me though - the current Call rate at my main bank - ANZ - is 0.20%. Don't know why they bother really!

[777]

I've just received an email from Heartland Bank advising that the interest rate on Call deposits is increasing next week from 1.05% to $1.50% p.a.

I'm very much happier owning part of the bank than having cash on deposit with them.

Heartland does look after a bit of spare dosh for me though - the current Call rate at my main bank - ANZ - is 0.20%. Don't know why they bother really!

Direct Broking call is giving 1.25%.

[nztx]

I've just received an email from Heartland Bank advising that the interest rate on Call deposits is increasing next week from 1.05% to $1.50% p.a.

I'm very much happier owning part of the bank than having cash on deposit with them.

Heartland does look after a bit of spare dosh for me though - the current Call rate at my main bank - ANZ - is 0.20%. Don't know why they bother really!



I'm very much happier owning part of the bank than having cash on deposit with them.

So very true - you're on to it :)

[newbieinvestor]

Managed to "hound up" a few more at the close today at $2.25. In the circumstances, what a gift !


So Mr B its currently at $2.29 and the markets are slowly crumbling .. at what level would you back up the truck?
Will be interesting to see how far it retraces...probably makes sense for the stock to fall to its lows and get in as it bounces back on the way up ...

[dabsman]

So Mr B its currently at $2.29 and the markets are slowly crumbling .. at what level would you back up the truck?
Will be interesting to see how far it retraces...probably makes sense for the dagger to fall to lows and catch it as it bounces on the way up ...

Have you ever tried bouncing a dagger?

[newbieinvestor]

Have you ever tried bouncing a dagger?


Sorry my bad.. too many trains of thoughts ...didnt word it properly but no I haven't tried to do that .. :) better edit that comment..

[Beagle]

So Mr B its currently at $2.29 and the markets are slowly crumbling .. at what level would you back up the truck?
Will be interesting to see how far it retraces...probably makes sense for the dagger to fall to lows and catch it as it bounces on the way up ...

A lot depends upon your risk tolerance and timeframe for holding. I wouldn't describe the share price as slowly crumbling, you'd expect a down day today.

The TA isn't especially clear to me at this point in time. I remain a happy holder with a significant allocation. The recent acquisition will be eps accretive.

[newbieinvestor]

A lot depends upon your risk tolerance and timeframe for holding. I wouldn't describe the share price as slowly crumbling, you'd expect a down day today.

The TA isn't especially clear to me at this point in time. I remain a happy holder with a significant allocation. The recent acquisition will be eps accretive.


Thanks Beagle! HGH is a long term hold but yeah I mentioned the overall market is crumbling so... so affecting HGH price... looking for a good entry point... will wait and watch...

[winner69]

ANZ NZ profit up 18%

Hope HGH can beat that

[newbieinvestor]

ANZ NZ profit up 18%

Hope HGH can beat that

Whens HGH result btw W69?

[pierre]

June Balance date - FY result announced late August.

[Rawz]

Had lunch with some mates that work at HGH a few weeks back. They reckon arrears across all portfolios are at record lows.

[winner69]

Had lunch with some mates that work at HGH a few weeks back. They reckon arrears across all portfolios are at record lows.

What they let slip re Harmoney .... you must have asked

[Rawz]

What they let slip re Harmoney .... you must have asked

Big Chinese wall is up. Wasnt on their radar

[newbieinvestor]

June Balance date - FY result announced late August.

Thanks Pierre!

Does anyone know why the volumes of HGH on ASX are so thin?
(Guess its not a good idea to invest in HGH on ASX given dividend imputation,etc..)

[Monarch]

Thanks Pierre!

Does anyone know why the volumes of HGH on ASX are so thin?
(Guess its not a good idea to invest in HGH on ASX given dividend imputation,etc..)

To my knowledge you get the same imputation as an NZ tax resident with both the NZX and ASX HGH shares. The Australians have many listed banks and finance companies to choose from and most pay dividends with franking credits (the aus version of imputation), HGH is probably not as compelling in comparison.

[newbieinvestor]

To my knowledge you get the same imputation as an NZ tax resident with both the NZX and ASX HGH shares. The Australians have many listed banks and finance companies to choose from and most pay dividends with franking credits (the aus version of imputation), HGH is probably not as compelling in comparison.

Thanks Monarch!:t_up:

[newbieinvestor]

A lot depends upon your risk tolerance and timeframe for holding. I wouldn't describe the share price as slowly crumbling, you'd expect a down day today.

The TA isn't especially clear to me at this point in time. I remain a happy holder with a significant allocation. The recent acquisition will be eps accretive.


2.23 hmmm... Wonder if it will go to 2.20 ...Will wait watch and see... but yeah looks like good times to back up the truck coming up for you Beagle :D

[850man]

2.23 hmmm... Wonder if it will go to 2.20 ...Will wait watch and see... but yeah looks like good times to back up the truck coming up for you Beagle :D

I bought a few yesterday, that's why it's down today. A nasty response to me purchasing that I'm hoping will go away one day soon

[Mel]

I bought a few yesterday, that's why it's down today. A nasty response to me purchasing that I'm hoping will go away one day soon
My share purchases also result in the same outcome :)

[Beagle]

2.23 hmmm... Wonder if it will go to 2.20 ...Will wait watch and see... but yeah looks like good times to back up the truck coming up for you Beagle :D

I'm already close to my self imposed maximum portfolio allocation to any one stock on this one.

[newbieinvestor]

I'm already close to my self imposed maximum portfolio allocation to any one stock on this one.


So if I may ask - do you have a fixed % of how much you allocate to one stock (similar to your signature - do you divide equally amongst each.... even if say your conviction levels are higher of some over others? )

[Beagle]

So if I may ask - do you have a fixed % of how much you allocate to one stock (similar to your signature - do you divide equally amongst each.... even if say your conviction levels are higher of some over others? )

Everyone needs to find what suits them best in terms of portfolio allocation strategies. What's appropriate for me, a few years away from retirement may not suit someone a lot younger who's prepared to take a more risky approach. A few years back in my mid 50's I would sometimes go to 15% for a really high conviction position but these days I am more comfortable with a 10% maximum allocation and only go there for very high conviction stocks. Holdings vary depending on the level of conviction, for example OCA was 3.5% but was raised to 5% yesterday. Hope that helps.

[newbieinvestor]

Everyone needs to find what suits them best in terms of portfolio allocation strategies. What's appropriate for me, a few years away from retirement may not suit someone a lot younger who's prepared to take a more risky approach. I a few years back I would sometimes go to 15% for a really high conviction position but these days I am more comfortable with a 10% maximum allocation and only go there for very high conviction stocks.
Holdings vary depending on the level of conviction, for example OCA was 3.5% but was raised to 5% yesterday.

Hope that helps.


Thanks very much Beagle! :t_up:

[newbieinvestor]

I'm already close to my self imposed maximum portfolio allocation to any one stock on this one.

Hi Beagle - Thinking of investing in some HGH & IFT for the long term via ASX. For a NZ tax resident would there any difference in the imputations via NZX vs ASX? (AUD seems like a better hedge to be in...eventhough the volumes on ASX are much thinner...) TIA!

[Beagle]

Nobody has ever asked me that before so I am not sure on that one mate, sorry. I don't think its an effective strategy anyway because the main board listing for those two is here and the Aussie price will generally track the N.Z. price adjusted for the exchange rate. I think 99.99% of people wouldn't bother with that because all other things being equal, liquidity is never a bad thing.

For example in some classic valuation models I have seen over the years a paucity of liquidity needs to be rewarded with an extra 2% per annum return vs a stock with great liquidity.

[newbieinvestor]

Nobody has ever asked me that before so I am not sure on that one mate, sorry. I don't think its an effective strategy anyway because the main board listing for those two is here and the Aussie price will generally track the N.Z. price adjusted for the exchange rate. I think 99.99% of people wouldn't bother with that because all other things being equal, liquidity is never a bad thing.

For example in some classic valuation models I have seen over the years a paucity of liquidity needs to be rewarded with an extra 2% per annum return vs a stock with great liquidity.

Thanks Beagle! Come to think of it yes - you right, it doesnt seem like an effective strategy... I guess I was just looking to stash them someplace away out of sight for a while..:D .. Thanks!

[BlackPeter]

Thanks Beagle! Come to think of it yes - you right, it doesnt seem like an effective strategy... I guess I was just looking to stash them someplace away out of sight for a while..:D .. Thanks!

Just a general clarification. Any shares of NZ companies traded as well on the ASX (or the other way around) are the same shares of the same company, i.e. the tax treatment is as well the same. However - your NZ return might look a bit different, given that you need to declare foreign dividends in a different form than domestic dividends. Bottom line (i.e. tax you need to pay) however should not change (but potentially some rounding errors due to exchange rates and similar).

You can as well transfer these shares through your broker (was for me free of charge, but it does cost you some paperwork) from ASX to NZX and vice versa. This might help to remedy any potential arbitration losses the low liquidity otherwise might cost you. Takes however time - i.e. no selling on the press of a button ... complete the form and wait some days.

Personally - I don't see any advantage of investing in the respective lower liquidity market but a possible arbitration gain (or loss) and more paper work.

[newbieinvestor]

Just a general clarification. Any shares of NZ companies traded as well on the ASX (or the other way around) are the same shares of the same company, i.e. the tax treatment is as well the same. However - your NZ return might look a bit different, given that you need to declare foreign dividends in a different form than domestic dividends. Bottom line (i.e. tax you need to pay) however should not change (but potentially some rounding errors due to exchange rates and similar).

You can as well transfer these shares through your broker (was for me free of charge, but it does cost you some paperwork) from ASX to NZX and vice versa. This might help to remedy any potential arbitration losses the low liquidity otherwise might cost you. Takes however time - i.e. no selling on the press of a button ... complete the form and wait some days.

Personally - I don't see any advantage of investing in the respective lower liquidity market but a possible arbitration gain (or loss) and more paper work.


Thanks BlackPeter! for all the inputs and also pointing out that could possibly transfer them across exchanges albeit with paperwork! (which might be worthwhile in case an investor happens to move across either side of the ditch!) ..Cheers

[Rawz]

New CEO for Heartland bank. Nabbed a Westpac exec. Good stuff.

Chris Flood moves up to group deputy CEO and will help old mate Jeff take over Aussie.

Endless growth ahead for HGH and they have a proven track record of growing. Great long term compounder. Hope to pick up a bunch sub $2 during the current storm

[percy]

New CEO for Heartland bank. Nabbed a Westpac exec. Good stuff.

Chris Flood moves up to group deputy CEO and will help old mate Jeff take over Aussie.

Endless growth ahead for HGH and they have a proven track record of growing. Great long term compounder. Hope to pick up a bunch sub $2 during the current storm

Yes all good stuff.
Flood and Greenslade work well together.

[thegreatestben]

Rawz - do you really think we'll see sub $2? I'll be buying if we do get there but I have my doubts.

[Rawz]

I have no idea. But wouldnt surprise me in this market.

During the covid crash it dropped from $1.80 to $0.90 a share.

[Old mate]

Stop it you two. It's heading to the top of the loser board today.:ohmy:

[winner69]

Stop it you two. It's heading to the top of the loser board today.:ohmy:

.....just starting to follow the global dairy prices down with the usual lag ..... dairy been down the last 5 auctions

[Rawz]

How much of their book is even related to ag sector?

[Old mate]

Yeah noticed that winner some big drops in some of those auctions too.

[winner69]

How much of their book is even related to ag sector?

You’ve got to think outside the obvious …it’s not really about whether they have ag clients but the bigger picture.

Dairy prices are one of the lead indicators for general levels of economic activity ….and as Jeff has often said Heartland’s fortunes are closely tied to GDP (and employment)

one of the most ‘accurate’ economic forecasting models I’ve seen is one run by an investment manager called his 3 C’s Model ……inputs are Commodity Prices, Climate (soil moisture deficit) and Currency. Things are going to be good when the grass grows and producers are getting good prices and currency is favourable……and vice versa ."?like you’ve probably heard about the drought induced recessions NZ has every now and again.

[Rawz]

You’ve got to think outside the obvious …it’s not really about whether they have ag clients but the bigger picture.

Dairy prices are one of the lead indicators for general levels of economic activity ….and as Jeff has often said Heartland’s fortunes are closely tied to GDP (and employment)

one of the most ‘accurate’ economic forecasting models I’ve seen is one run by an investment manager called his 3 C’s Model ……inputs are Commodity Prices, Climate (soil moisture deficit) and Currency. Things are going to be good when the grass grows and producers are getting good prices and currency is favourable……and vice versa ."?like you’ve probably heard about the drought induced recessions NZ has every now and again.

Ah yes. Thanks Master Winner

[winner69]

Conjecture over on HMY thread that Heartland might have to face up to a $5m hit on their Harmoney investment when June numbers come out

HMY share price down 40% since December 31st when Heartland last did a fair value number

[alokdhir]

Conjecture over on HMY thread that Heartland might have to face up to a $5m hit on their Harmoney investment when June numbers come out

HMY share price down 40% since December 31st when Heartland last did a fair value number

That will make HGH miss guidance I reckon ....Forbar target possible then ...:scared:

[winner69]

That will make HGH miss guidance I reckon ....Forbar target possible then ...:scared:

No worries alokdhir

Still got that Covid cover in the bottom drawer ...... anyway Jeff will just report 'normalised profit' not counting any writedown

Why show a big negative when its going to be a huge positive in a few years time

[jimdog31]

That will make HGH miss guidance I reckon ....Forbar target possible then ...:scared:

Remind me what was their target?

[alokdhir]

Remind me what was their target?

$ 1.85 ....underperform ...

[jimdog31]

$ 1.85 ....underperform ...

Ouch. What was their latest guidance?

[Beagle]

Forbar have been negative on Heartland all the way from $1.30 in Nov 2020 and been wrong all that time.
Consensus target price is $2.23 https://www.marketscreener.com/quote/stock/HEARTLAND-GROUP-HOLDINGS-47041144/consensus/

[Entrep]

Broker targets are complete bs and mainly based on companies they want to do raises for etc.

[Waltzing]

Banks did not sell off today after OCR statement and they are usually linked to the AUS market anyway.

HGH probably not so linked.

[BlackPeter]

Broker targets are complete bs and mainly based on companies they want to do raises for etc.

Any price targets are complete bs (if they are taken as a forecast) - brokers are in that regard neither better nor worse than anybody else defining a price target. Has something to do with Ben Grahams statement that NOBODY is able to predict future stock prices. This does include brokers.

[dabsman]

Banks did not sell off today after OCR statement and they are usually linked to the AUS market anyway.

HGH probably not so linked.

Why would banks sell off after a rates hike? Higher rates higher NIM usually

[Waltzing]

"Higher rates higher NIM usually"

one wonders why FOO BAR is not in favour of this stock.

NIM up, one hopes so.

But WBC, ANZ are AUS price driven.

[SCOTTY]

HGH with good long term borrowing at low rates should be in a very nice position right now especially for their reverse mortgage book :)

[newbieinvestor]

Conjecture over on HMY thread that Heartland might have to face up to a $5m hit on their Harmoney investment when June numbers come out

HMY share price down 40% since December 31st when Heartland last did a fair value number


Got some at $2.08 but not sure..... might decline further if there is a correction...

[Muse]

Got some at $2.08 but not sure..... might decline further if there is a correction...

banks invariably get caught up in the negative sentiment when the economy looks like it will deteriorate. it's just one of those things...some investors start to fret 'what happens to the bank' if a recession (or the always on the horizon depression) occurs. I wouldn't be surprised at all if that continues to happen.

recession might happen and we start to get some increased incurred credit losses and increased provisions...but between now and then at least we have all that lazy regulatory capital (that has just been chilling out earning nothing) start to earn some actual interest income as rates rise. that'll be good, and probably be a few relief rallies after earnings announcements, before the drift sets back in again.

Happy holder - but not accumulating, yet.

[alokdhir]

HGH making people nervous ....Latest is Josh's latest video on YouTube ...in which he is saying negative things about HGH ...mainly for Harmoney hit of $ 7.5 mil as per him and HGH's direct correlation with economy ...Reverse mortgage is also a worry for him ...as house prices dropping and rates going up ..so he says negative for HGH ...He switched to bigger Aussy bank !!

Is HGH in trouble ?

https://www.youtube.com/watch?v=JEi-OGW10R4

[winner69]

HGH making people nervous ....Latest is Josh's latest video on YouTube ...in which he is saying negative things about HGH ...mainly for Harmoney hit of $ 7.5 mil as per him and HGH's direct correlation with economy ...Reverse mortgage is also a worry for him ...as house prices dropping and rates going up ..so he says negative for HGH ...He switched to bigger Aussy bank !!

Is HGH in trouble ?

https://www.youtube.com/watch?v=JEi-OGW10R4

Jeff still got his covid overlay to release ….that’ll offset the temporary decline in Harmoney share price wh h no doubt will have to be adjusted in Heartlands accounts.

Yes Jeff says Heartlands fortunes tied to economic growth but also to employment levels and that’s still OK

And many say higher interest rates equals higher NIM and apparently that’s good.

[winner69]

No restrictions on bank dividends now ….. that should help a bit

[winner69]

HGH making people nervous ....Latest is Josh's latest video on YouTube ...in which he is saying negative things about HGH ...mainly for Harmoney hit of $ 7.5 mil as per him and HGH's direct correlation with economy ...Reverse mortgage is also a worry for him ...as house prices dropping and rates going up ..so he says negative for HGH ...He switched to bigger Aussy bank !!

Is HGH in trouble ?

https://www.youtube.com/watch?v=JEi-OGW10R4

Jeez besides selling Heartland he’s been selling Oceania as well

[thegreatestben]

I like Josh’s videos but he has been wrong a bit lately haha. Gonna stick with HGH and OCA.

[nztx]

With interest rates charged increasing markedly in months ahead, the range shortens between
what some companies are paying out (excluding tax credits)

At some point with higher mortgage interest rates, the equation has moved sufficiently where
the best move is to give any mortgages & borrowings the shove first .. ahead of investing

Possibly an angle some haven't considered, but grossing up Interest costs to what pre-tax
income level is needed to cover these could be a wake up call V looking at some higher Div Yielders
coming ever the more closer if not been overtaken with RBNZ's recent / upcoming OCR footwork

[Baa_Baa]

I like Josh’s videos but he has been wrong a bit lately haha. Gonna stick with HGH and OCA.

Buy high sell low. Josh has a bit to learn, it's little about the share market per se except for timing, but more about the company - whether you want it or not. Then comes the timing.

[Snow Leopard]

I like Josh’s videos but he has been wrong a bit lately haha. Gonna stick with HGH and OCA.

The video does start with "....for entertainment purposes only...."

Disc: Long-time and long-term and very happy holder. My No1 NZX stock.

[beetills]

Happy holder also.Have been a shareholder since first listed when my CBS shares were converted over.Picked up a few more when Kerr sold down and have a 50% participation in the DRP.
Along with my other mainstay share in CDI things seem to be going well .
The above are my NO 1 &2 STOCK with the 3 thru to 10 not so good.

[winner69]

Maybe us Heartlanders should feel proud that its taken something as the mighty Macquarie to seduce Jason to prefer them over Heartland .... think I'll stick to Heartland

From Direct Broking current ratios

Macquarie PE 14.47 / Div Yield 3.38% / 2.9 time NTA

Heartland PE 13.21 / Div Yield 6.2% / 1.7 time NTA

Maybe time for Beagle to update his peer group comparisons

[winner69]

HGH seems to have entered bear territory - 20% down from recent high

Did the same in 2018 and when markets went stupid with onset of Covid in 2020

Falling Global Dairy Trade prices since March don't seemed to have helped the Heartland share price ..... bit spooky GDT prices fell during 208 as well.

Jeff says Heartland fortunes dependent on GDP ..... many say we are heading into a recession .... is HGH share price a leading indicator .... or is more bad to come

[nztx]

HGH seems to have entered bear territory - 20% down from recent high

Did the same in 2018 and when markets went stupid with onset of Covid in 2020

Falling Global Dairy Trade prices since March don't seemed to have helped the Heartland share price ..... bit spooky GDT prices fell during 208 as well.

Jeff says Heartland fortunes dependent on GDP ..... many say we are heading into a recession .... is HGH share price a leading indicator .... or is more bad to come


Already well sold down here to avoid Kiwi Bears :)

Some nice big Oilers elsewhere lurking to warm things up and frazzle your whiskers on any currency woes ..

[newbieinvestor]

banks invariably get caught up in the negative sentiment when the economy looks like it will deteriorate. it's just one of those things...some investors start to fret 'what happens to the bank' if a recession (or the always on the horizon depression) occurs. I wouldn't be surprised at all if that continues to happen.

recession might happen and we start to get some increased incurred credit losses and increased provisions...but between now and then at least we have all that lazy regulatory capital (that has just been chilling out earning nothing) start to earn some actual interest income as rates rise. that'll be good, and probably be a few relief rallies after earnings announcements, before the drift sets back in again.

Happy holder - but not accumulating, yet.

Thanks Fiordland Moose! :t_up: Tried to post earlier but the website has been down...
Exited my recent small position in green on reading your post and watching Josh's video..
HGH seems to be in a bit of a bear hug now ... $2.05.. will wait for it to fall more...

[Old mate]

Global milk price up 1.5% in latest auction. First rise for 3 months winner.

[alokdhir]

HGH is really looking weak these days ...Need some help from financial engineering in upcoming results and optimistic future outlook ...

So far Forbar winning over our as well as Jarden analysts ....

[winner69]

Global milk price up 1.5% in latest auction. First rise for 3 months winner.

That's pretty good eh ...even higher in NZD

HGH share price could follow suit in a few weeks time ..... maybe a profit upgrade coming

[alokdhir]

That's pretty good eh ...even higher in NZD

HGH share price could follow suit in a few weeks time ..... maybe a profit upgrade coming

Then is it time to load up mate ??

[Old mate]

Yeah mate rip into it:t_up:

[newbieinvestor]

HGH is really looking weak these days ...Need some help from financial engineering in upcoming results and optimistic future outlook ...

So far Forbar winning over our as well as Jarden analysts ....

When is the next result expected to be made available..? Will be interesting to see how they account for HMY shares like Josh mentioned....

[alokdhir]

When is the next result expected to be made available..? Will be interesting to see how they account for HMY shares like Josh mentioned....

End August ...date TBA

[newbieinvestor]

End August ...date TBA

Thanks Alokdhir! .. Yeah HGH's holding HMY getting hammered on the ASX...

[Rawz]

Guess HGH will have to do a huge write down on HMY. Then report 'normalised earnings'. Fair enough

[winner69]

Guess HGH will have to do a huge write down on HMY. Then report 'normalised earnings'. Fair enough

Jeff says $93m to $96m which means it'll be about $95.4m

The calculation involving escrow, spreads, volatility, trading patterns etc etc will no doubt mean HMY stake will be written down a bit ..... but he has the covid overlay and a few other things in the bottom drawer so things will be OK

Anyway whatever HMY is written down buy will only mean huge gains in F23 and F24 eh

[Rawz]

Jeff says $93m to $96m which means it'll be about $95.4m

The calculation involving escrow, spreads, volatility, trading patterns etc etc will no doubt mean HMY stake will be written down a bit ..... but he has the covid overlay and a few other things in the bottom drawer so things will be OK

Anyway whatever HMY is written down buy will only mean huge gains in F23 and F24 eh

So use current bottom draw stuff to cover HMY.
Then HMY becomes next bottom draw stuff

Nice, i like it.

[newbieinvestor]

So use current bottom draw stuff to cover HMY.
Then HMY becomes next bottom draw stuff

Nice, i like it.

recycling bottom drawer stuff? :D


wonder whether when the market hears of a HMY write down, if the HGH stock will dip further :confused:....

[Rawz]

HGH hold 8518864 shares in HMY. Was valued at A$1.91 (by memory) so au$16.2m at last reported date.
HMY now au$0.895 x 8518864 shares = au$7.6m current value.

au$8.6m drop in valuation.

The covid overlay is $6.9m?

Wonder is Jeff wanted to keep some of that covid overlay for actual covid related loans in arrears. But now HMY is buggering that up

How big is the bottom draw? :ohmy:

[alokdhir]

Jeff says $93m to $96m which means it'll be about $95.4m

The calculation involving escrow, spreads, volatility, trading patterns etc etc will no doubt mean HMY stake will be written down a bit ..... but he has the covid overlay and a few other things in the bottom drawer so things will be OK

Anyway whatever HMY is written down buy will only mean huge gains in F23 and F24 eh

As long as dividends keep coming on expected track of 1 cent boost every year ...then its a great buy now ...if dividends under threat then all bets are off

W69 ...whats your take on future dividend security here ?

[winner69]

As long as dividends keep coming on expected track of 1 cent boost every year ...then its a great buy now ...if dividends under threat then all bets are off

W69 ...whats your take on future dividend security here ?

Not held back by RBNZ now so could even expect a bit of a boost / catch up this year and then back to normality

[mike2020]

I really think the issue with HMY is liquidity. It is far to easy to lower the price with the use of a little cash and it could be a very clever way to get some cheaper HGH.

[winner69]

HGH hold 8518864 shares in HMY. Was valued at A$1.91 (by memory) so au$16.2m at last reported date.
HMY now au$0.895 x 8518864 shares = au$7.6m current value.

au$8.6m drop in valuation.

The covid overlay is $6.9m?

Wonder is Jeff wanted to keep some of that covid overlay for actual covid related loans in arrears. But now HMY is buggering that up

How big is the bottom draw? :ohmy:

Not marked to market rawz …take a lot of factors into how you value them but they will be taking a hit

[Muse]

Aussie banks hammered
https://www.afr.com/companies/financial-services/big-bank-shares-fall-homeowners-eye-who-s-next-on-rates-20220608-p5arzn

re: HMY - while it has been bid down on minuscule volumes I also struggle to see how HGH will be able to convince their auditor no further impairment is necessary. RAWZ has done the math on what that could look like at PBT impact. However, the theoretical dimiunition in value to HGH is exactly that, at ~$8.6m (or the change in book value form last reporting period to next expected reporting period), not 8.6m multiplied by some multiple. When i look at heartland, I read through the npat impact from the mark to market of non operating assets both on the way up, and on the way down. Better to value the operations of heartland first (by capitalising operating earnings by an appropriate multiple), then adding surplus assets second.

to put it in context: HGH's share in HMY has decreased from the last reporting period to now by ~AU$8.6m. Translated that to NZD, divide that by shares on issue, of 592.9m, that is approx a 1.6c per share impact. that's sweet FA.

re heartlands lending to harmoney, they do have a wholesale lending line. but that is is rapid run off. From what I understand, heartland were a institutional lender to harmoney's peer to peer business (feels weird to say an institution can be a peer to peer lender, but its what happened) but they aren't a warehouse provider. I understand they aren't writing any more loans and are just receiving things as they come in, so the operational impact is quite limited given harmoney have wound down p2p, and are only lending on a warehouse or securitized basis now

HGH getting dragged down by fears of what will happen next year if there is a recession, and sentiment yesterday when the RBA surprised Aussies (but no kiwis) that a 50bps hike was warranted. Personnally, I see more downside coming from a SP/TA perspective. Not selling any shares as a long term holder, but will watch and wait and perhaps buy a bunch more sometime in 2023. My two cents, but I believe banks will get caught up in sentiment around the economy driving the SP down, there will be a few relief rallies as actual reports come in that surprise on the upside and sooth investors as households still have strong balance sheets and banks do tend to earn more interest income from regulatory capital and lending when rates rise, offset later by a capitulation when impairments rise. and for me, personally,that is when I like financial stocks...right at the top of the interest rate cycle, when recession is imminent or just starting to happen, and the outlook is weakest. same with bonds.

[alokdhir]

Aussie banks hammered
https://www.afr.com/companies/financial-services/big-bank-shares-fall-homeowners-eye-who-s-next-on-rates-20220608-p5arzn

re: HMY - while it has been bid down on minuscule volumes I also struggle to see how HGH will be able to convince their auditor no further impairment is necessary. RAWZ has done the math on what that could look like at PBT impact. However, the theoretical dimiunition in value to HGH is exactly that, at ~$8.6m (or the change in book value form last reporting period to next expected reporting period), not 8.6m multiplied by some multiple. When i look at heartland, I read through the npat impact from the mark to market of non operating assets both on the way up, and on the way down. Better to value the operations of heartland first (by capitalising operating earnings by an appropriate multiple), then adding surplus assets second.

to put it in context: HGH's share in HMY has decreased from the last reporting period to now by ~AU$8.6m. Translated that to NZD, divide that by shares on issue, of 592.9m, that is approx a 1.6c per share impact. that's sweet FA.

re heartlands lending to harmoney, they do have a wholesale lending line. but that is is rapid run off. From what I understand, heartland were a institutional lender to harmoney's peer to peer business (feels weird to say an institution can be a peer to peer lender, but its what happened) but they aren't a warehouse provider. I understand they aren't writing any more loans and are just receiving things as they come in, so the operational impact is quite limited given harmoney have wound down p2p, and are only lending on a warehouse or securitized basis now

HGH getting dragged down by fears of what will happen next year if there is a recession, and sentiment yesterday when the RBA surprised Aussies (but no kiwis) that a 50bps hike was warranted. Personnally, I see more downside coming from a SP/TA perspective. Not selling any shares as a long term holder, but will watch and wait and perhaps buy a bunch more sometime in 2023. My two cents, but I believe banks will get caught up in sentiment around the economy driving the SP down, there will be a few relief rallies as actual reports come in that surprise on the upside and sooth investors as households still have strong balance sheets and banks do tend to earn more interest income from regulatory capital and lending when rates rise, offset later by a capitulation when impairments rise. and for me, personally,that is when I like financial stocks...right at the top of the interest rate cycle, when recession is imminent or just starting to happen, and the outlook is weakest. same with bonds.

My only concern is about Dividend paying capacity ...if they can continue that on present projected track then holding HGH thru this storm is not difficult . SP wont deteriorate too much as will have Yield support ...Mr B said at $ 1.94 it becomes Gross 10% yielder which is massive provided yield not under threat . So for me all analysis should be focused on its dividend paying ability thru this storm as that will cushion the SP fall . I am told that HGH has very efficient risk management systems and they are much better managed then bigger banks by being more efficient and safer

[percy]

Having a NIM [net interest margin] nearly twice the major banks also helps.

[winner69]

you guys are overlooking the power of 'proactive provisioning'

Jeff master of that

[alokdhir]

you guys are overlooking the power of 'proactive provisioning'

Jeff master of that

As per u mate ...present day SP is an opportunity or not to act upon temptation ??

[winner69]

As per u mate ...present day SP is an opportunity or not to act upon temptation ??

It all depends on how despondent punters are alokdhir ..... mood is such that maybe 190 is on cards next week

When Jeff gives them a comforting cuddle and hugs (ie a +ve report) they might feel a bit happier

[waikare]

As well as being a share holder I also bank with then, not my main everyday account, mainly for savings / term deposits etc.

Is just me does any others have difficulty navigating around the Heartlands website. I would like to change the the date on two of my 90 Day Notice accounts, but I buggered if I can find where or how to do this. Being a gold card holder for number I years, I find it very frustrating when thing like this should a simple task, not having to ask for assistance on a simple transaction. ( Sent them a message to this effect, still awaiting a response)

[winner69]

Heartland's FY21 Real ROE was 8.6% (Nominal reported 11.9% less inflation 3.3%)

This year assuming a nominal 12.0% ROE and say 7.0% inflation the F22 Real ROE is 5.0%


If one assumes that Real PE ratios are reflective of company performance the Nominal PE (adjusted for inflation) should be lower than the Real PE

This nominal / real stuff flows through to PE ratios as well - which implies the PE of 15 HGH was trading on late last year should now be less than 10 --- meaning a share price of $1.60 is possible

Theoretical stuff so no worries ..... but ask your self why do PE ratios tend to decline in times of high inflation.

[Waltzing]

1.60 would be a great buy!!!!

[RTM]

As well as being a share holder I also bank with then, not my main everyday account, mainly for savings / term deposits etc.

Is just me does any others have difficulty navigating around the Heartlands website. I would like to change the the date on two of my 90 Day Notice accounts, but I buggered if I can find where or how to do this. Being a gold card holder for number I years, I find it very frustrating when thing like this should a simple task, not having to ask for assistance on a simple transaction. ( Sent them a message to this effect, still awaiting a response)

Yes...I have some banking with them and find the site average at best.

[Grimy]

The phone app isn't bad, but the internet banking through their web site is clunky and not user friendly/intuitive.

[777]

As well as being a share holder I also bank with then, not my main everyday account, mainly for savings / term deposits etc.

Is just me does any others have difficulty navigating around the Heartlands website. I would like to change the the date on two of my 90 Day Notice accounts, but I buggered if I can find where or how to do this. Being a gold card holder for number I years, I find it very frustrating when thing like this should a simple task, not having to ask for assistance on a simple transaction. ( Sent them a message to this effect, still awaiting a response)

If you go to "Make a Payment" and select the account you want to transfer from, the date of transfer will automatically show up to be 90 days from todays date.

[Rawz]

Heartland's FY21 Real ROE was 8.6% (Nominal reported 11.9% less inflation 3.3%)

This year assuming a nominal 12.0% ROE and say 7.0% inflation the F22 Real ROE is 5.0%


If one assumes that Real PE ratios are reflective of company performance the Nominal PE (adjusted for inflation) should be lower than the Real PE

This nominal / real stuff flows through to PE ratios as well - which implies the PE of 15 HGH was trading on late last year should now be less than 10 --- meaning a share price of $1.60 is possible

Theoretical stuff so no worries ..... but ask your self why do PE ratios tend to decline in times of high inflation.

Me oh my another thing to think about- I havnt heard about adjusting P/Es for inflation before.

Probably have to look through the 7% inflation year as unlikely to repeat in FY23, FY24, FY25...?

[Snoopy]

Me oh my another thing to think about- I havnt heard about adjusting P/Es for inflation before.

Probably have to look through the 7% inflation year as unlikely to repeat in FY23, FY24, FY25...?


I haven't heard of adjusting PEs for inflation either.

1/I have heard of adjusting PEs downward because rising interest rates reduce customer spending power.
2/ Rising interest rates also tend to elevate our currency, and that has a negative effect on our exporters that in turn might flow through to a lower PER.
3/ Rising wage demands with an uncertainty as to whether those extra costs can be recovered can have a negative effect on profits and PEs as well.

You could argue that 1,2 and 3 above are all caused by inflation. But I don't think that reducing PERs specifically because of inflation is the right thing to do. You need to look at the downstream effects of inflation to make a call on that. You might argue that from a bank point of view, for instance, that rising inflation leads to rising net interest margins. So PERs for banks should be raised.

SNOOPY

[winner69]

Quote Snoopy - You might argue that from a bank point of view, for instance, that rising inflation leads to rising net interest margins.

Inflation should lead to rising interest income .... but rising net interest margins?

[Snoopy]

Quote Snoopy - You might argue that from a bank point of view, for instance, that rising inflation leads to rising net interest margins.

Inflation should lead to rising interest income .... but rising net interest margins?

Based on the idea that interest lending rates to customers go up faster than interest term deposit rates to other customers. Hence rising NIMs.

SNOOPY

[Muse]

Quote Snoopy - You might argue that from a bank point of view, for instance, that rising inflation leads to rising net interest margins.

Inflation should lead to rising interest income .... but rising net interest margins?

inflation > higher OCR/swap rates > rising bank interest income & should leave to higher net interest margin dollars (IE a banks GP before credit losses). Perhaps not higher net interest margin as a % of book (coin toss on if those improve or compress, probably depends on individual banks strategy around marketshare and how elastic their deposit costs are

[Muse]

Based on the idea that interest lending rates to customers go up faster than interest term deposit rates to other customers. Hence rising NIMs.

SNOOPY

sorry snoop i didnt see your post as I was typing mine, beat me to it.
in addition to what you said, banks regulatory capital starts to earn some decent dollars to as rates rise. thats a lot of dough that was earning bugger all in 2020 & 2021 that starts to earn something now, bit of a silver lining

[winner69]

Based on the idea that interest lending rates to customers go up faster than interest term deposit rates to other customers. Hence rising NIMs.

SNOOPY

OK then - Current NIM (H122) was 4.30%.

Last 8 years averaged 4.40% - range 4.33% to 4.5% ...the 4.50% a bit of an outlier

So Snoops me old mate - with the recent surge in interest rates what your reckon NIM % will be for F23

[Muse]

Heartland's FY21 Real ROE was 8.6% (Nominal reported 11.9% less inflation 3.3%)

This year assuming a nominal 12.0% ROE and say 7.0% inflation the F22 Real ROE is 5.0%


If one assumes that Real PE ratios are reflective of company performance the Nominal PE (adjusted for inflation) should be lower than the Real PE

This nominal / real stuff flows through to PE ratios as well - which implies the PE of 15 HGH was trading on late last year should now be less than 10 --- meaning a share price of $1.60 is possible

Theoretical stuff so no worries ..... but ask your self why do PE ratios tend to decline in times of high inflation.

ha, top shelf theoretical stuff there winner. made my heard hurt as i tried to contemplate it

i resisted sharing this earlier in the year, but reading this and thinking through the 'doom loop' is another good way to give you a sore head
https://www.bloomberg.com/opinion/articles/2022-04-20/can-big-u-s-banks-avoid-a-european-style-doom-loop

mark to market of bonds in a rising environment errodes capital and puts divies at risk, so the theory goes.

at some point you just cant see the wood from the trees if you think too much about these things. Banks a pretty good proxy for the wider economy. On my investment horizon, I know the economy will be substantially larger in 10 and 20 years than now, and so will earnings and the SP, and stop worrying about it. Plus, HGH a pretty nifty bank, excellent NIM as percy points out, and ROE. Even better.

[Snoopy]

OK then - Current NIM (H122) was 4.30%.

Last 8 years averaged 4.40% - range 4.33% to 4.5% ...the 4.50% a bit of an outlier

So Snoops me old mate - with the recent surge in interest rates what your reckon NIM % will be for F23


I am really just parroting stuff my broker told me a few months back Winner. Using actual figures and reality to shoot down my theory? What sort of a debating tactic is that?

The key to being a top class economist is being able to spin a good yarn. And the great thing about being an economist is that a few months down the track, no-one member of the public can remember what you said. So you just spin another good yarn, to remove any temptation for your client to look back at what you actually said 'back then''. Brokers often use the same tactic. The only problem there being that, if you listened to your brokers advice at the time and acted on that advice, then you do remember what your broker said 'at the time'! Poor brokers!

Fortunately I had already built up my HGH holding at a price level significantly below what the HGH price was when it came onto my brokers 'buy' list. So these HGH price fluctuations in recent months are not of much concern to me. To be fair I am not too worried about net interest margins either. If there is any pressure on interest margins Jeff will just record it as an 'extraordinary one off' and we will all be happy shareholders again. FY23 is many broker and economist forecasts away.

SNOOPY

[alokdhir]

[QUOTE=winner69;961209]It all depends on how despondent punters are alokdhir ..... mood is such that maybe 190 is on cards next week

When Jeff gives them a comforting cuddle and hugs (ie a +ve report) they might feel a bit happier[/QUOTE

So if one is looking at a income stock for long term hold then its attractively priced now ...forget how much cheaper it can become ...then one should start accumulation ...as almost 9.5% Gross yield is golden in the long term ....unless people anticipate 10% or higher term rates ahead !!!

[Balance]

Sigh - one of the top broker picks for 2022 is struggling to find a floor.

All due to its shareholding & lending to Harmoney or expectations that loan losses are going to be really bad with the economy going backwards?

[alokdhir]

Another bad day for HGH ...

Calling experts to say something comforting for holders please ...:D

Is buying now is trying to catch ...Falling Knife :p

[Muse]

Another bad day for HGH ...

Calling experts to say something comforting for holders please ...:D

Is buying now is trying to catch ...Falling Knife :p

good article in AFR about bank wipeout in aussie yesterday
https://www.afr.com/chanticleer/why-banks-stocks-have-entered-correction-territory-20220609-p5asm2

[alokdhir]

good article in AFR about bank wipeout in aussie yesterday
https://www.afr.com/chanticleer/why-banks-stocks-have-entered-correction-territory-20220609-p5asm2

Jarden analyst yesterday said HGH is getting dragged down because of Aussy banks poor outlook ...where as HGH's outlook is not necessarily equally " BAD "

That gives solace that it will come back and this maybe opportunity to add some at very good yield prices

Its just over 9% Gross ...even better then GNE at SP of $ 1.92

[winner69]

Another bad day for HGH ...

Calling experts to say something comforting for holders please ...:D

Is buying now is trying to catch ...Falling Knife :p

Share price tied to how aussie banks are going ... doesn't really matter how HGH are performing .... even the might jeff can't move the HGH share price against these odds

Wait until the dust settles with those I reckon best bet

Maybe even get HGH for about 150 (or less)

[Balance]

Share price tied to how aussie banks are going ... doesn't really matter how HGH are performing .... even the might jeff can't move the HGH share price against these odds

Wait until the dust settles with those I reckon best bet

Maybe even get HGH for about 150 (or less)

No point going against the rip - float with it and wait until one hits calm waters. Conserve energy to swim back or call for rescue.

[alokdhir]

Share price tied to how aussie banks are going ... doesn't really matter how HGH are performing .... even the might jeff can't move the HGH share price against these odds

Wait until the dust settles with those I reckon best bet

Maybe even get HGH for about 150 (or less)

I hope its SP doesn't start reminding us about the story of two companies ...lol

But jokes apart ...Why its yield not cushioning its fall ...means Mr Market thinks yield is not sustainable ...Is it ?

[clearasmud]

I hope its SP doesn't start reminding us about the story of two companies ...lol

But jokes apart ...Why its yield not cushioning its fall ...means Mr Market thinks yield is not sustainable ...Is it ?

Falling house prices means less demand for reverse mortgages.
Increasing cost of funds could mean less margin as above 7% a reverse mortgage is becoming too dear.

[bullfrog]

Falling house prices means less demand for reverse mortgages.
Increasing cost of funds could mean less margin as above 7% a reverse mortgage is becoming too dear.

The reverse mortgage angle was a major factor when I initially invested in HGH, rising house prices/locked in equity/low interest rates. But the falling house prices and rising interest rates make the reverse mortgage business less attractive, time to sit on the sidelines for a while.

[percy]

Some of the reasons people take out a reverse mortgage remain.
Pay for a medical procedure.
Home improvements.
World trip.
Help out members of the family.
Buy a new car [electric].

[Bjauck]

The reverse mortgage angle was a major factor when I initially invested in HGH, rising house prices/locked in equity/low interest rates. But the falling house prices and rising interest rates make the reverse mortgage business less attractive, time to sit on the sidelines for a while. For some perspective, the house price index was:
2615 !/5/2022
2366 1/5/2021
1913 1/5/2020
1771 1/5/2019

Heartland expanded its reverse mortgage business in September 2020, so I guess the house price index could go down to about 1965 (a drop of about 20% from today) and there could still be good business to be had.

https://www.qv.co.nz/price-index/

[Ggcc]

Some of the reasons people take out a reverse mortgage remain.
Pay for a medical procedure.
Home improvements.
World trip.
Help out members of the family.
Buy a new car [electric].

I agree. Not too many problems I see for HGH REL in the longterm. I am already over invested at an average price of around $1.30. I find at this price a great longterm entry point for some. DYOR and not business advice.

It might drop some more next week but I will calmly hold as I am a longterm investor in this share. Great management with skin in the game.

[Muse]

Some of the reasons people take out a reverse mortgage remain.
Pay for a medical procedure.
Home improvements.
World trip.
Help out members of the family.
Buy a new car [electric].

well said.

and in the short term we can't forget with higher cost of living and diminished retirement savings the need for a reverse mortgage may actually increase

[iceman]

well said.

and in the short term we can't forget with higher cost of living and diminished retirement savings the need for a reverse mortgage may actually increase

Agreed. I don’t think a bit of pullback in house prices will negatively affect the REL market. The customers are elderly with huge equity and as percy points out above, seek RELs for various valid reasons. The increasing cost of living could well provide one more reason customers may want to draw down a bit of debt to help themselves, children or grandchildren. HGH’s REL business is strong and I have no concerns about it.
We need to also remember it is only one of many segments HGH is in.
A very happy holder and just added a few more

[alokdhir]

I am torn between HGH and GNE ...both have excellent yields at the moment ...GNE yield seems more secure to me and less dependent on economy ...which surely will be collateral damage in big Inflation fight needed .

My purpose is mainly long term income with moderate capital appreciation as bonus ...will be switching from IFT ...

HGH may have more growth prospects but my highest priority at the moment is security of yield and its long term dependability ....

Any thoughts will be most welcome and appreciated

[Shareguy]

I see both HGH and GNE as great companies and have large positions in both. Currently feel that HGH will go lower as inflation and recession fears loom. GNE getting close to bottom (my opinion) with potential large upside and reasonably secure dividend stream for several years.

[Rawz]

Go GNE 18 months then HGH 4 years. Check back after that

[Snoopy]

I am torn between HGH and GNE ...both have excellent yields at the moment ...GNE yield seems more secure to me and less dependent on economy ...which surely will be collateral damage in big Inflation fight needed .

My purpose is mainly long term income with moderate capital appreciation as bonus ...will be switching from IFT ...

HGH may have more growth prospects but my highest priority at the moment is security of yield and its long term dependability ....

Any thoughts will be most welcome and appreciated


I am in favour of stacking up one investment against another when making an investment decision. It prevents tunnel vision investment that can lead to investment disaster. However, because no-one can predict the future with all its twists and turns, it does make sense to have a diversified portfolio across different industries that are not reliant on one theme. For this reason, and knowing you have done your due diligence on both HGH and GNE, if you are happy with both, then I would invest in both. There is no need to try and pick 'the winner' here.

SNOOPY

[newbieinvestor]

I am torn between HGH and GNE ...both have excellent yields at the moment ...GNE yield seems more secure to me and less dependent on economy ...which surely will be collateral damage in big Inflation fight needed .

My purpose is mainly long term income with moderate capital appreciation as bonus ...will be switching from IFT ...

HGH may have more growth prospects but my highest priority at the moment is security of yield and its long term dependability ....

Any thoughts will be most welcome and appreciated


If I may ask why are switching from IFT ? seems to be pretty stable\secure....

[winner69]

A bit on Aussie banks and this weeks panic selling…..which HGH share price followed down

https://www.morningstar.com.au/stocks/article/can-you-still-bank-on-the-banks-editors-note/224116

Here’s Zaia again on why puncturing an overly optimistic outlook is no issue for long term investors:

“We never assumed there would be a rosy picture forever anyway. The market is taking in that adjustment or change but is probably getting carried away by focusing on those downside risks.”

[alokdhir]

Thanks mates for your very well thought out options ...Yes I agree with Snoopy that equal mix of both GNE and HGH will cover larger spectrum ...GNE surely looking better at the moment as mentioned by ShareGuy ...but longer term both will even out ...which is my goal ...long term sustainable income .

Newbie ...I am trying to switch from IFT as looking to prefer income over growth ...otherwise nothing wrong with IFT ...I agree with u

Rawz ...best solution ...GNE for 18 months to ride out this down phase with high yield then get all eggs in HGH basket to enjoy the economy boom time

[Peter Stewart]

Falling house prices means less demand for reverse mortgages.
Increasing cost of funds could mean less margin as above 7% a reverse mortgage is becoming too dear.

Whilst the NZ business is holding with little competition, Australia is completely different. Broker business is dropping off, one new player is about 2 weeks away and another by year end

[Beagle]

Banks don't do well in a recession. US bank index down more than 20% so far this year https://www.cnbc.com/quotes/.DJUSBK which puts HGH's decline pretty much in line with the average US bank, some of whom its worth noting are already on high single digit metrics.
GNE my #1 market position, and the most defensive high yield stock I know of on the NZX.
I recently switched out some of HGH for GNE and all of my OCA for GNE and ARG.
Based on many, many years of observations HGH trade in a PE range of 9 to 18. 9 is usually a very good time to back the truck and trailer up and 18 a very good time to sell.
https://www.marketscreener.com/quote/stock/HEARTLAND-GROUP-HOLDINGS-47041144/financials/
Average analyst has it on a FY23 PE of 11.2 @ $1.92. 20% fall from here is a real chance in a very serious recession.
PE of 9 would put it in the low $1.50's. If it gets that low that's maybe time to back the truck up...unless we're heading into a global depression ? :scared:

[Snoopy]

Banks don't do well in a recession. US bank index down more than 20% so far this year https://www.cnbc.com/quotes/.DJUSBK which puts HGH's decline pretty much in line with the average US bank, some of whom its worth noting are already on high single digit metrics.


Q/ When do you call a finance company in drag a bank?
A/ When its name is Heartland.

I don't buy these 'peer group' arguments. We should all be grateful that Heartland is a bank in marketing spiel only. We all know Heartland bank accounts are actually Westpac bank accounts with a Heartland marketing sticker on the top of the page. Even that is pushing things. The parent company we can invest in, is called 'Heartland Group Holdings'. But that company doesn't have a banking licence. Only its subsidiary does, and that is for 'marketing reasons'.

SNOOPY

[winner69]

Q/ When do you call a finance company in drag a bank?
A/ When its name is Heartland.

I don't buy these 'peer group' arguments. We should all be grateful that Heartland is a bank in marketing spiel only. We all know Heartland bank accounts are actually Westpac bank accounts with a Heartland marketing sticker on the top of the page. Even that is pushing things. The parent company we can invest in, is called 'Heartland Group Holdings'. But that company doesn't have a banking licence. Only its subsidiary does, and that is for 'marketing reasons'.

SNOOPY

I think most think of Heartland being a finance company .... and not a bank

Even Jeff calls it a fintech

But its uncanny how the rises and the falls in the HGH share price seems to follow aussie banks .... and how they are valued much in line with those banks and not in line with finance / fintech companies

[winner69]

Crickey - I see HGH closed 20% down at A$1.54 on Friday

Thats about $1.70 odd in NZD

Carnage tomorrow morning?

[Baa_Baa]

Crickey - I see HGH closed 20% down at A$1.54 on Friday

Thats about $1.70 odd in NZD

Carnage tomorrow morning?

Not sure what you're looking at winner:




HGH (https://online.asb.co.nz/ost/9DA1C8828B6DFCC330FB3B685C42E822/quotesummary/index/asx/hgh)





$1.715


https://online.asb.co.nz/ost/Content/Style/Images/arrow-down-red.png 22.5
11.6%






ASX https://www2.asx.com.au/markets/company/hgh $1.715 -$0.224 (-11.597%)

[winner69]

Not sure what you're looking at winner:




HGH (https://online.asb.co.nz/ost/9DA1C8828B6DFCC330FB3B685C42E822/quotesummary/index/asx/hgh)





$1.715


https://online.asb.co.nz/ost/Content/Style/Images/arrow-down-red.png 22.5
11.6%






ASX https://www2.asx.com.au/markets/company/hgh $1.715 -$0.224 (-11.597%)

Direct broking looks like this

[percy]

Direct broking looks like this
Australia......................................... ...............................................New Zealand
Last price traded 860 shares at $1.54............................................. .....50,031 at $1.92
VWAP $1.6974........................................... .......................................$1.9342
Total volume traded for the day 2872 shares for total value $4,875..........Volume 652,642 ..Value $1,262,312
No point in getting too excited about the small volume or price in Aussie.

[Beagle]

Q/ When do you call a finance company in drag a bank?
A/ When its name is Heartland.

I don't buy these 'peer group' arguments. We should all be grateful that Heartland is a bank in marketing spiel only. We all know Heartland bank accounts are actually Westpac bank accounts with a Heartland marketing sticker on the top of the page. Even that is pushing things. The parent company we can invest in, is called 'Heartland Group Holdings'. But that company doesn't have a banking licence. Only its subsidiary does, and that is for 'marketing reasons'.

SNOOPY

Snoopy me ol Beagle mate have you had a good sniff through their financials' lately and looked at the size of their reverse home loan lending book and the speed its growing ? The only part of their book that really worries me is their exposure to "Harmoney" which is lending based on nothing more than one's credit rating and is quite possibly going to be anything but harmonious in a deep recession. That said, yeah, this is a real chance of going down to the bottom of its metrics trading range of 9-18 and a resulting share price of about $1.50-$1.60 in a deep recession just like most other banks have considerable possible downside risk. I don't think Josh looking to hide in Macquarie's will do him any good, (bright young likeable guy though).

[Baa_Baa]

Direct broking looks like this

That's odd, ASX.com, ASB Sec, Stockness ... all say AU$1.71

[percy]

Snoopy me ol Beagle mate have you had a good sniff through their financials' lately and looked at the size of their reverse home loan lending book and the speed its growing ? The only part of their book that really worries me is their exposure to "Harmoney" which is lending based on nothing more than one's credit rating and is quite possibly going to be anything but harmonious in a deep recession. That said, yeah, this is a real chance of going down to the bottom of its metrics trading range of 9-18 and a resulting share price of about $1.50-$1.60 in a deep recession just like most other banks have considerable possible downside risk. I don't think Josh looking to hide in Macquarie's will do him any good, (bright young likeable guy though).

You got worked up when you thought HGH had an over large exposure to dairying..................................All was well.
Also when they offered no deposit loans on new Holden cars.............................................. ...................All was well.
Snoopy got all worked up on legacy property loans............................................. ..................................All was well.
Percy does not get worked up................................................ .................................................. ...........All is well.

[Beagle]

History proves they badly underperformed the market during the dairy crisis in a very serious way.
Financials' have a long and bad track record of underperforming the market in a recession.

[SCOTTY]

History proves they badly underperformed the market during the dairy crisis in a very serious way.
Financials' have a long and bad track record of underperforming the market in a recession.

History proved it to be a great buying opportunity :)

[Muse]

History proves they badly underperformed the market during the dairy crisis in a very serious way.
Financials' have a long and bad track record of underperforming the market in a recession.

sentiment driven by fear & down ramping impacted hgh far more than heartlands underlying financial performance during the dairy crisis. heartland performed admirably through the dairy price downturn, with its lending concentration far smaller & secured than what was portrayed.

agree that sentiment gets impacted, it is what it is, and that will matter far more to momentum traders, than to investors.

re harmoney, not sure if you noticed but heartlands exposure to them is shrinking massively. HGH provided lines to harmoney's off balance sheet p2p business, which is being wound down, and heartland's lending to them is in run off, shrinking rapidly. if recent rates of run off continue, possible hgh's receiveables could be at or close to nil within 12-18 months, and at 31 december 2021 represented a very small fraction of hgh's book.

[couta1]

You got worked up when you thought HGH had an over large exposure to dairying..................................All was well.
Also when they offered no deposit loans on new Holden cars.............................................. ...................All was well.
Snoopy got all worked up on legacy property loans............................................. ..................................All was well.
Percy does not get worked up................................................ .................................................. ...........All is well. Bark it up brother.

[Beagle]

sentiment driven by fear & down ramping impacted hgh far more than heartlands underlying financial performance during the dairy crisis. heartland performed admirably through the dairy price downturn, with its lending concentration far smaller & secured than what was portrayed.

agree that sentiment gets impacted, it is what it is, and that will matter far more to momentum traders, than to investors.

re harmoney, not sure if you noticed but heartlands exposure to them is shrinking massively. HGH provided lines to harmoney's off balance sheet p2p business, which is being wound down, and heartland's lending to them is in run off, shrinking rapidly. if recent rates of run off continue, possible hgh's receiveables could be at or close to nil within 12-18 months, and at 31 december 2021 represented a very small fraction of hgh's book.

You can't be serious that comments on here materially affected the share price. The market was very well aware HGH had a very serious level of exposure to the embattled dairy sector at the time and was reacting rationally to a very real risk of huge financial losses. Heartland took the risk to carry farmers through the crisis and in my view they were lucky to get away with it. My analysis shows Heartland badly underperformed the NZX50 during the dairy crisis...I suppose a lot depends upon what start and end dates you use to define this ill defined crisis. Fortunately these days the percentage of exposure to this sector is much lower relative to their expanding balance sheet.
Agree with your other points and I am very pleased to see their level of exposure to unsecured lending being dialed right back.
For the purposes of my own analysis I have already written off the value of their stake in Harmoney.