OCA - Oceania Group - retirement villages

[Cyclical]

Someone's been selling up large here. A buy depth of 300k+ @80c has disappeared in the space of an hour.

[Food4Thought]

Someone's been selling up large here. A buy depth of 300k+ @80c has disappeared in the space of an hour.

Former Chief Financial Officer Matthew Ward sold out on 24 March.

This puzzles me. Keeps popping to mind when thinking about what is happening.

Anyone else unable to let this thought go?

Ideas to why?

Perhaps needs the money, moving countries etc. Some households are currently selling up and moving home all over the world.

[Gerald]

Former Chief Financial Officer Matthew Ward sold out on 24 March.

This puzzles me. Keeps popping to mind when thinking about what is happening.

Anyone else unable to let this thought go?

Ideas to why?

Perhaps needs the money, moving countries etc. Some households are currently selling up and moving home all over the world.

It's entirely possible he got caught up in the panic like many retail investors. Taking a long term veiw, selling $1.04 odd of property for effectively $0.45 or so doesn't seem a particularily smart move. Also, if he beleived the shares were worth $0.45, why did he not sell out at over $1.20?

You also have to consider the number of insiders who brought up during the period:

Gregory Tomlinson - Brought 1m
Elizabeth Coutts - Brought 50k
Alan Isaac - 10k + 20k
Mark Stockton - 90k odd

If you get excited over every insider buy/sell you will have a hard life.

[Cadalac123]

Former Chief Financial Officer Matthew Ward sold out on 24 March.

This puzzles me. Keeps popping to mind when thinking about what is happening.

Anyone else unable to let this thought go?

Ideas to why?

Perhaps needs the money, moving countries etc. Some households are currently selling up and moving home all over the world.

Insider buying or selling shouldn't really be too looked into imo, but if we're going to speculate insider buying is probably a lot more reliable as a projection of company growth confidence than selling which can mean a new toy for home or absolutely nothing the public needs to actually know about.

Been plenty of times insiders all lined up and bought stock and the stock still plummeted significantly. I quite a few case studies where insiders bought heavily after a stock plummeted and then the stock just kept plummeting down, as if the insiders wanting to all lose 100k+ plus

[Baa_Baa]

Insider buying or selling shouldn't really be too looked into imo, but if we're going to speculate insider buying is probably a lot more reliable as a projection of company growth confidence than selling which can mean a new toy for home or absolutely nothing the public needs to actually know about.

Been plenty of times insiders all lined up and bought stock and the stock still plummeted significantly. I quite a few case studies where insiders bought heavily after a stock plummeted and then the stock just kept plummeting down, as if the insiders wanting to all lose 100k+ plus

Truth is we’ll never know why an insider buys or sells, hence the frequent reference to “building a new deck”. What is more informative than one insider making a move on market is when a whole swag of insiders move together, then its follow the money.

[winner69]

Earl giving us the warm fuzzies

All quiet on the oceania front

Banks helping out if they need more dosh

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/OCA/352203/321422.pdf

[trader_jackson]

Earl giving us the warm fuzzies

All quiet on the oceania front

Banks helping out if they need more dosh

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/OCA/352203/321422.pdf

Yup, boom times back on winner, even 80 cents looking pretty cheap now.
Net debt has jumped from from $150m as at end FY18 to $247m at end FY19, to $288.1m at 1H20, and $321.2 as at... Friday 24th April? 'Growth' in Net Debt seems to be slowing down a touch, not sure if other parts of the business is slowing down even more...

[King1212]

We are so lucky in NZ.....this virus did not kill all our aged care

[Beagle]

Yup, boom times back on winner, even 80 cents looking pretty cheap now.
Net debt has jumped from from $150m as at end FY18 to $247m at end FY19, to $288.1m at 1H20, and $321.2 as at... Friday 24th April? 'Growth' in Net Debt seems to be slowing down a touch, not sure if other parts of the business is slowing down even more...

Every company in the retirement sector will be materially affected by Covid 19 including ARV.

[Waltzing]

well as the man who called the BEAR and shorted AIR. I would have thought you would be waiting for the wave of selling. Though MR O is ready with his printing electronic press..

[Waltzing]

i would think 55 to 60 cents would be back up very quickly..even if labour brings back some form of wider tax reforms..in this economy this sector is surely a long term winner..

[nztx]

i would think 55 to 60 cents would be back up very quickly..even if labour brings back some form of wider tax reforms..in this economy this sector is surely a long term winner..


I would think that Robertson would want to be seen to be very nimble on any Tax Reforms in Election Year - so as to not risk turning the current total shambles into a Black Economy basket case .. unless Labor want to suffer the consequences..

[peat]

Every company in the retirement sector will be materially affected by Covid 19 including ARV.


They were affected by a law change , nothing else. Repeat after me!

[Beagle]

They were affected by a law change , nothing else. Repeat after me!

LOL - Law change, law change...Maybe you could train a cockatiel to parrot that :D

[Entrep]

Craigs has a new TP of 87c on OCA

[trader_jackson]

Craigs has a new TP of 87c on OCA
Interesting, forgot to mention earlier that on 15th April, Forsyth had a target of $1.08.

[huxley]

Interesting, forgot to mention earlier that on 15th April, Forsyth had a target of $1.08.

More debt & slower sales = 1) possible slow down in development 2) reducing dividend 3) equity raising

[Cyclical]

Someone's been selling up large here. A buy depth of 300k+ @80c has disappeared in the space of an hour.

The downward pressure continues on this one. Someone is selling larger parcels as soon as there is a reasonable amount of support. About 200k of shares dropped in there in the last 5 minutes and it's been like that for the last week or so.

[Chinesekiwi]

I'm heavily invested in this one and have been for about 18 months - was lucky enough to grab at .40 (but that only balances out the north of .95 purchases).

All things considered I am still undecided if the moves down represent another solid buy opportunity or I am missing an impending activity which speaks to the perpetual selling happening recently.

Recent director purchases point in one direction - 'he hopes'

[Cyclical]

All things considered I am still undecided if the moves down represent another solid buy opportunity or I am missing an impending activity which speaks to the perpetual selling happening recently.

That's the $64k question isn't it. If all that support at 75c gets wiped out, I might have to stop averaging down for a bit until we know what's going on.

[Nigel]

Long-term, this sector will do just fine. There will undoubtedly be ups and downs along the way, but I think OCA will be a strong performer in the long run. If you want to (attempt to) trade the shorter-term trends, go for it, but I'm comfortable buying as funds allow and look forward to $1+ shareprices again once confidence returns to the market.

[Balance]

Just finished reading a recently issued report by one of the major broking houses in Australasia on NZ's Retirement Village sector.

Nothing really new which have not been discussed and debated ad nauseam here in the Meet, Sum & Oca threads.

Nevertheless, a few key points to note from the report (report goes to their institutional & international client base so bound to have some influence) :

1. Demographics trend continue to provide strong tailwind for long term performance of the sector, population of 75+ to double over next 10 years (250,000 more), and

2. Short term headwinds of increased costs and lower unit resales to adversely impact on profits in 2020/21.

Sensitivities:

1. Increased costs in order of biggest impact - OCA, ARV, RYM, SUM & MET

2. Devaluation of asset values when gearing hits 50% (trigger point for debt concerns) - RYM (14%), SUM (15%), OCA (25%), ARV (26%) & MET (38%).

3. Most highly geared so likely to require capital raising - RYM (40%), SUM (33%), OCA (31%), ARV (27%) & MET (16%).

[Ggcc]

someone is keen to dump their shares......

[Cyclical]

someone is keen to dump their shares......

Yeah, a few hundred thousand in the last few minutes. It's been happening for a week or so, but looks to have suddenly ramped up. Whenever you see buy support of a few hundred thousand, it gets wiped out same day.

[Balance]

someone is keen to dump their shares......

Switching over to MET?

[Leftfield]

Just finished reading a recently issued report by one of the major broking houses in Australasia on NZ's Retirement Village sector.

Nothing really new which have not been discussed and debated ad nauseam here in the Meet, Sum & Oca threads.

Nevertheless, a few key points to note from the report (report goes to their institutional & international client base so bound to have some influence) :

1. Demographics trend continue to provide strong tailwind for long term performance of the sector, population of 75+ to double over next 10 years (250,000 more), and

2. Short term headwinds of increased costs and lower unit resales to adversely impact on profits in 2020/21.

Sensitivities:

1. Increased costs in order of biggest impact - OCA, ARV, RYM, SUM & MET

2. Devaluation of asset values when gearing hits 50% (trigger point for debt concerns) - RYM (14%), SUM (15%), OCA (25%), ARV (26%) & MET (38%).

3. Most highly geared so likely to require capital raising - RYM (40%), SUM (33%), OCA (31%), ARV (27%) & MET (16%).

Thanks for posting. Is their a link to the full report?

[Cyclical]

Switching over to MET?

Haha, wondered the same. That would just see my portfolio seesaw atm, have an even split between the 2 (as at 10am...might be getting more OCA at this rate).

[Ggcc]

Switching over to MET?
I believe many capital raises are around the corner, not only for OCA but many other companies. Maybe fund managers are getting ready by selling shares to get money ready for their quotas for good companies, as many businesses will need money.

[Balance]

Thanks for posting. Is their a link to the full report?

It is not public information. If you are a client of the firm or knows someone who is, then it is possible to obtain a copy. It is from an Australasian broking firm with offices right around the world.

[Leftfield]

Thanks Balance. Appreciated.

[bottomfeeder]

I have started buying into OCA. I don't mind a capital raise, as long as its not to cover losses. However I would prefer reinvestment of dividends. Cut the dividend. Then as the price goes down, I will buy more.

[Valiant]

Thanks for the summary Balance.


Just finished reading a recently issued report by one of the major broking houses in Australasia on NZ's Retirement Village sector.

Nothing really new which have not been discussed and debated ad nauseam here in the Meet, Sum & Oca threads.

Nevertheless, a few key points to note from the report (report goes to their institutional & international client base so bound to have some influence) :

1. Demographics trend continue to provide strong tailwind for long term performance of the sector, population of 75+ to double over next 10 years (250,000 more), and

2. Short term headwinds of increased costs and lower unit resales to adversely impact on profits in 2020/21.

Sensitivities:

1. Increased costs in order of biggest impact - OCA, ARV, RYM, SUM & MET

2. Devaluation of asset values when gearing hits 50% (trigger point for debt concerns) - RYM (14%), SUM (15%), OCA (25%), ARV (26%) & MET (38%).

3. Most highly geared so likely to require capital raising - RYM (40%), SUM (33%), OCA (31%), ARV (27%) & MET (16%).

[Waltzing]

In 5 years time the increase in money supply will make this sector whole again. History repeats itself and next time the bubble could be even higher than this time.

[nztx]

I believe many capital raises are around the corner, not only for OCA but many other companies. Maybe fund managers are getting ready by selling shares to get money ready for their quotas for good companies, as many businesses will need money.

In this Sector, I wouldn't expect so many Cap Raises, as some of the other Sectors

Anyone see any term financing maturing with companies in this sector which would likely necessitate a CR
or bankers not prepared to renew / roll over for further term ?

[Balance]

In this Sector, I wouldn't expect so many Cap Raises, as some of the other Sectors

Anyone see any term financing maturing with companies in this sector which would likely necessitate a CR
or bankers not prepared to renew / roll over for further term ?

There's plenty of money out there still - AIA's $1.2 billion gives us the best idea of how investors feel about putting in more money into a good long term infrastructure company hit by a shorter term (between 1 to 2 years) issue.

The smart companies will do what IPL has just done - in the name of getting well-positioned, and raise the funds while the appetite is there.

[Maverick]

In this Sector, I wouldn't expect so many Cap Raises, as some of the other Sectors

Anyone see any term financing maturing with companies in this sector which would likely necessitate a CR
or bankers not prepared to renew / roll over for further term ?
nztx, OCA have already told us they were preparing to do a bond issue ( not share issue) in their 1HY report. This was pre-virus. Cant see why this won't be happening sooner rather later.

[Waltzing]

well they could just slow down the development for a while but if the virus is limited hazard pay might not cuase a pay rise..

it just depends if they can defer there capital expenditure.

DISC: sold out at 1.30 and lost the profit selling out of AIR not fast enough even after beagles warning... in shock.. but did not know it.. even after tracking the virus from late january.

everyone in the country will be wanting to buy there lovely new woolen fashionable face masks manufactured in the south island by those wonderful new italian sock making machines , and that includes every one in rest homes..

if they go public prehaps woolen socks and face masks are the next big thing... the say they cant wait to have Kathmandu open. they are apparently there biggest stockest..

[King1212]

The boss spoke on the NBR....saying he is very confident with the company future

[Waltzing]

I lost my lovely profits from this stock in the AIR NZ crash even after beagle warned and i was tracking the virus from january. It appear it was already in europe pre xmas. If OCA drops back to the 60's i will double or triple my current holding. Yes i bought back in but missed 40 cents. I must have been out riding the hills and in shock...Those of use who rode the crash down i think are only just recovering our wits to trade again and invest. The GFC was a slow affair , now i would like to see sells offs this winter but the shear amount of QE may not give us those wonderful prices again.. pitty. Still theres a bull market coming....And after putting new systems in place over the last 10 years we are now ready to start the rolls outs...

[winner69]

Short but sweet preso

Doesn’t seem to be anything new.

Can borrow heaps more if needed ..that’s good

Hopefully get a few fund managers to buy more

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/OCA/352774/322107.pdf

[trader_jackson]

Short but sweet preso

Doesn’t seem to be anything new.

Can borrow heaps more if needed ..that’s good

Hopefully get a few fund managers to buy more

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/OCA/352774/322107.pdf

Nothing new is good, if not great, news in this climate... should put OCA close to the $1 mark (at least - and even then it would still be a discount to NTA, sum others in the sector are back to trading well above NTA)

[Balance]

Short but sweet preso

Doesn’t seem to be anything new.

Can borrow heaps more if needed ..that’s good

Hopefully get a few fund managers to buy more

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/OCA/352774/322107.pdf

More like Macquarie hoping that the presentation there will help those who bought the last lot in 2020 off the ‘millionaires’ factory’ sell out before the next lot of capital raising?

[macduffy]

I agree, tj, it's a case of no news is good news - but I wouldn't go so far as to hazard a guess on the shareprice, given the current state of the world.

[Balance]

More like Macquarie hoping that the presentation there will help those who bought the last lot in 2020 off the ‘millionaires’ factory’ sell out before the next lot of capital raising?

Perfect timing - 251m shares sold at $1.20 in Jan 2020.

Now you know why Macquarie is called the Millionaires' factory!

[nevchev]

Seems alot are locking in profits and why not.Not sure about the numbers that were sold during the sell down but we should see a rise to NTA when there done and it will happen quickly imho

[Cyclical]

Seems alot are locking in profits and why not.Not sure about the numbers that were sold during the sell down but we should see a rise to NTA when there done and it will happen quickly imho

I'm not sure what you mean by a rise to NTA when they're done, but certainly someone has been selling down in large numbers for the last 2 weeks or so, bringing the share price down about 15% in the process...hopefully we've found the floor, as I'm just about over averaging down!

[Ggcc]

I'm not sure what you mean by a rise to NTA when they're done, but certainly someone has been selling down in large numbers for the last 2 weeks or so, bringing the share price down about 15% in the process...hopefully we've found the floor, as I'm just about over averaging down! I feel the last of the dump has not finished. Every time 200,000 shares are purchased a fresh batch of 200,000 arrive. Someone needs the cash or feels better shares available????

[Cyclical]

I feel the
last of the dump has not finished. Every time 200,000 shares are purchased a fresh batch of 200,000 arrive. Someone needs the cash or feels better shares available????

Yep. Looks like they are keen to keep feeding them in at the 73-74c range...it just edged into 72 the other day, but not for long. They'll probably dump a bunch into that nice bed of support at 73 later this arvo, after the 74c buyers have all dried up...and there seem to be plenty of those off the back of this morning's presentation.

[Balance]

I feel the
last of the dump has not finished. Every time 200,000 shares are purchased a fresh batch of 200,000 arrive. Someone needs the cash or feels better shares available????

If you believe in the stock, take Warren Buffett’s advice and help yourself to more when they are on sale. Nobody can pick the bottom.

[winner69]

Just like all that ‘rinse and washing’ or whatever it was described as when they share price hung around 105 after that previous Macca dump

History repeating ...no doubt same players and they’ve got heaps more to play with this time.

[Ggcc]

If you believe in the stock, take Warren Buffett’s advice and help yourself to more when they are on sale. Nobody can pick the bottom.
My problem is I don’t want to do a couta. Originally I did and glad I didn’t. I don’t know what is a bargain anymore. Luckily I picked up about 40,000 shares below this price, but was that a bargain.... currently but tell me in 6 months time lol

[Balance]

Just like all that ‘rinse and washing’ or whatever it was described as when they share price hung around 105 after that previous Macca dump

History repeating ...no doubt same players and they’ve got heaps more to play with this time.

At the ground level, I am told that international investors/shareholders are selling out because of the disastrous situation with retirement villages and care homes in Europe & US.

Understandable that they do not believe the situation in the sector in Australasia is under control - question of time for them before the sector implodes like it has in Europe & US.

[Maverick]

Beagle cautioned a wee while back about the greater influence on a share price of perception verses reality.

Seems to be playing out just like that. All RV stocks have reverted, for now, to SP values of 12 months ago. The stand out exception being good ol` OCA which is currently about 30% less than 12 months ago.

This mornings release has basically said all is well in the hood, no surprises there. In fact I see this report having more positives in it than its peers can possibly have. But here we are, with the SP languishing by a country mile behind its cousins.

I put this down to a combo of 2 things.
Firstly, the 38% of stock recently sold into the market is still shuffling around from loose hands. Good to see ACC has now captured 5 % of this.
Secondly , OCA`s point of difference being late care stage is surely being seen as riskier in this environment, therefore "avoid'.

Both of these SP impediments are quite temporary , (unless of course COVID does get its way which is looking ever less likely- even then its still temporary- just longer temporary ).

As a long term/ value investor I`m very happy with today's report, its more or less business as usual with 6 week lost of development and ILU sales (not care-suites) . I considered this actually remarkably good when compared to most other NZSX industries.

"perception" surely is mostly why the SP is where it is - for now. In fact, value investors must embrace these uncomfortable SP times as this is how opportunities arise for the "small end of town" in a supposedly "efficient market".

It is only a matter of how much time before perception gives way to reality of how the business is actually performing.

FWIW surely it has to be revalued to some degree when the FY result turns out fairly healthy 2 months from now.

[Blue Skies]

At the ground level, I am told that international investors/shareholders are selling out because of the disastrous situation with retirement villages and care homes in Europe & US.

Understandable that they do not believe the situation in the sector in Australasia is under control - question of time for them before the sector implodes like it has in Europe & US.

Thanks Balance, interesting. Makes sense, couldn't understand why all retirement stocks suffering but had put it down to anticipated downward pressure on housing market which looks as if will be fairly short-lived .

[Beagle]

No question about it, it was a good solid update. The team at OCA are doing a very good job. Must confess I wasn't aware that care suites could still be sold under level 4 and 3 lockdown protocol's so that was a pleasant surprise. I think its worth reiterating that most people move into an OCA facility because of need or the future perceived need for care so its more a needs based decision than anything else.

Hard to put an estimate on FY20 and FY21 earnings, (so I won't try) but the whole market appears to be looking through to the other side of this Virus so in that context I think the shares are very sound value in the low 70's and looking ahead to FY22 earnings they are probably very cheap.

I agree Maverick. Perception, (at some stage), must collide with the reality of how well N.Z. as a whole is managing this crisis and OCA as a company is performing. Patient shareholders should do well from here over the long run. I also concur that a lot of weak hands from the Macquarie $1.20 (jacked up ?) placement have probably decided to cut their losses. Point is Macca's have gone and their overhang has likewise been removed from the market.

I can't see a lot to like on the NZX, (the bounce off 23 March 2020 lows has been too strong for my liking), with the odd exception that includes this one.

I know Coutts is back into this too :)

[nztx]

My problem is I don’t want to do a couta. Originally I did and glad I didn’t. I don’t know what is a bargain anymore. Luckily I picked up about 40,000 shares below this price, but was that a bargain.... currently but tell me in 6 months time lol

" I don’t know what is a bargain anymore"

Yes .. so very true too - Ggcc & not only with OCA either ;)

[Fred_Rubble]

Added to my existing holding today - solid unspectacular update.

The tailwinds of this sector keep me invested. Just wish mine was the green variety.

[Cyclical]

Yep. Looks like they are keen to keep feeding them in at the 73-74c range...it just edged into 72 the other day, but not for long. They'll probably dump a bunch into that nice bed of support at 73 later this arvo, after the 74c buyers have all dried up...and there seem to be plenty of those off the back of this morning's presentation.

It's an encouraging sign that there was still nice fat support at the end of the day at 73c, ~460k on the buy side that wasn't taken out. Hopefully that means whoever was dumping have finished...only time will tell. Maybe they were taken by the presso ;-)

[winner69]

The world in a sorry state today because guru economist Milton Friedman Said “the only responsibility of business is to maximize shortterm profits, regardless of the social and environmental costs.”


We’ve got to change that “Maximize short-term profits, regardless of the social and environmental costs” attitude to “maximize long-term benefits for all people and nature.”

I don’t give a stuff what Oceania’s short term profits are as long as they work towards creating a better life for all of us in the future.

[Beagle]

The world in a sorry state today because guru economist Milton Friedman Said “the only responsibility of business is to maximize shortterm profits, regardless of the social and environmental costs.”


We’ve got to change that “Maximize short-term profits, regardless of the social and environmental costs” attitude to “maximize long-term benefits for all people and nature.”

I don’t give a stuff what Oceania’s short term profits are as long as they work towards creating a better life for all of us in the future.

I think they're very much focused on residents care needs, no question whatsoever about that.

[Cyclical]

It's an encouraging sign that there was still nice fat support at the end of the day at 73c, ~460k on the buy side that wasn't taken out. Hopefully that means whoever was dumping have finished...only time will tell. Maybe they were taken by the presso ;-)

Nope, the sell down continues unabated.

11510

[Balance]

Nope, the sell down continues unabated.



Healthy profit-taking, I would say.

37m shares were sold down in the week of 23 March at between 40c to 55c.

Be a while yet before these traders sell out completely to lock in their profits - and why not?

If you are a fundamentalist, take the opportunity to add to the portfolio.

If you are a trader, wait for another 12m shares to go through imo before the sp bounces back up.

[peat]

ACC selling. I dont know whether they made a profit or not, I suspect not , but they're reducing to under the 5% level. and sold 367000 at 74c

[winner69]

ACC selling. I dont know whether they made a profit or not, I suspect not , but they're reducing to under the 5% level. and sold 367000 at 74c

Probably be over 5% again next week ...like they went over a few days ago

They bought heaps at over a buck in January/February

They did buy some SUM the other day.

[Beagle]

I picked up some today for 73 cents.

[Cyclical]

ACC selling. I dont know whether they made a profit or not, I suspect not , but they're reducing to under the 5% level. and sold 367000 at 74c


Probably be over 5% again next week ...like they went over a few days ago

They bought heaps at over a buck in January/February

They did buy some SUM the other day.

Interesting. They don't appear to be the main seller we've been seeing the last 2 or 3 weeks though. I wonder if they are just keen to stay under the 5% threshold. The figure they sold in the disclosure is pretty close to what they received from the DRP in Feb.

[Cyclical]

I picked up some today for 73 cents.

Doesn't look like they are going to get any cheaper, does it? Whoever has been selling large doesn't seem to want to offload into 72c...I've had a buy in there for the last week or so.

[youngatheart]

Oh great, so only 10 million left to go then, lol.

[Cyclical]

Oh great, so only 10 million left to go then, lol.

ACC? Try 30 million :D

[klid]

Are they selling down everything? Some of the trades they've done this year look really silly to me.

[Cyclical]

Are they selling down everything? Some of the trades they've done this year look really silly to me.

You'd hope not, given the average buy was about $1.04. I'd considered ACC to be a bit more on the ball than that and that this sector would be "safe as houses" for them over the long term.

[Balance]

ACC? Try 30 million :D

ACC trades around the edges, +/- 200k shares around their many core 5% holding levels in stocks.

Real sellers are those who picked up some of the 37m shares sold from 55c down to 40c.

They can't sell forever and there have been big crossings at 73c and 74c - means the institutions are stepping up to buy.

3m done today so far - so around another 9m to go (if they all sell out to lock in profits - which might not be the case).

[Cyclical]

ACC trades around the edges, +/- 200k shares around their many core 5% holding levels in stocks.

Real sellers are those who picked up some of the 37m shares sold from 55c down to 40c.

They can't sell forever and there have been big crossings at 73c and 74c - means the institutions are stepping up to buy.

3m done today so far - so around another 9m to go (if they all sell out to lock in profits - which might not be the case).

Roger that, Balance, thanks for the explanation. Seems to be pretty good support at these levels. Debating loading up on a few more as we must be about due an uptick on this one, just like MET. My portfolio is a bit more heavily weighted towards this one sector than I'd normally like, but just not seeing anything much else that hits the right price point at the moment.

[Balance]

At the ground level, I am told that international investors/shareholders are selling out because of the disastrous situation with retirement villages and care homes in Europe & US.

Understandable that they do not believe the situation in the sector in Australasia is under control - question of time for them before the sector implodes like it has in Europe & US.

BBC news tonight - 45% of total Covid-19 deaths (1403) in Northern Ireland were those from Care Homes.

[Maverick]

BBC news tonight - 45% of total Covid-19 deaths (1403) in Northern Ireland were those from Care Homes.
Just like NZ , I think we are actually worse

[Blue Skies]

Just like NZ , I think we are actually worse


Up until 2 days ago over half, 12 of 21 NZ deaths were from just the one Rest home, Rosewood Rest Home in CHC. That cluster also was responsible for 54 cases.

I feel its important to note that should not cast a shadow on dedicated staff who from all accounts have done their absolute best in a tragic situation.
An inquiry has reported staff were unable to change their PPE frequently enough & damp masks from exertion during the shifts likely caused the breach in protection.
The deaths mean Canturbury has by far the largest Covad mortality rate.

[Bjauck]

BBC news tonight - 45% of total Covid-19 deaths (1403) in Northern Ireland were those from Care Homes. Overseas shareholders - especially those institutions based in the USA and UK perhaps, would see what has in care facilities there and perhaps that colours their opinion of risk for NZ elder care too.

The actual figure for Covid deaths in the UK (& the USA too?) is understated as not all people who die in care homes (or in their own homes) have been tested for Covid-19. Reported Covid deaths include only those who have been tested and reported a positive result. There has been a severe lack of testing in the UK, as their PM ignored advice and they have not heeded WHO advice to "Test! Test! Test!"

It may be best to compare the current month's mortality rate with the average of the last two years. When that is done, many more elderly deaths could be attributed to Covid as deaths ascribed to another underlying cause, may have had undiagnosed Covid-19 which acted as the final straw.

[Cyclical]

Overseas shareholders - especially those institutions based in the USA and UK perhaps, would see what has in care facilities there and perhaps that colours their opinion of risk for NZ elder care too.

The actual figure for Covid deaths in the UK (& the USA too?) is understated as not all people who die in care homes (or in their own homes) have been tested for Covid-19. Reported Covid deaths include only those who have been tested and reported a positive result. There has been a severe lack of testing in the UK, as their PM ignored advice and they have not heeded WHO advice to "Test! Test! Test!"

It may be best to compare the current month's mortality rate with the average of the last two years. When that is done, many more elderly deaths could be attributed to Covid as deaths ascribed to another underlying cause, may have had undiagnosed Covid-19 which acted as the final straw.

I wonder if future generations will look back and think how crazy it is that we didn't know if people had died from C19 or something else. It sounds like I'm ready a piece of history from war times or something.

[King1212]

Or government plandemic

[fish]

Or government plandemic

Very poor and frustrating plans.
My perception is that the ongoing cases are the result of poor testing,inaccurate tests and failure to protect nurses and contacts of possible cases. The fault is in planning not people .
the lockdown has been very poorly planned eg forestry working stopped despite no evidence that there has been any transmission in outdoor workers.
We cannot be trusted to use our boats but ok for team NZ to go sailing in what is a very dangerous type of sailing.
The airforce and regional council in Northland has wasted so much in resources not to mention risks in searching for errant boaters.In response I see my neighbours go fishing at night to avoid detection.
I hear parties at night but i am not going to dob them in .Rather than police having roadblocks which probably has not reduced transmission it would be so easy for them to patrol streets looking for such risky things.
My wife sees people chatting in supermarkets-would be safe if they chatted outside keeping 2 metres distance .
Some people are really stupid and take risks so I have no problem if prosecutions ensued if others have been endangered .

[huxley]

Very poor and frustrating plans.
My perception is that the ongoing cases are the result of poor testing,inaccurate tests and failure to protect nurses and contacts of possible cases. The fault is in planning not people .
the lockdown has been very poorly planned eg forestry working stopped despite no evidence that there has been any transmission in outdoor workers.
We cannot be trusted to use our boats but ok for team NZ to go sailing in what is a very dangerous type of sailing.
The airforce and regional council in Northland has wasted so much in resources not to mention risks in searching for errant boaters.In response I see my neighbours go fishing at night to avoid detection.
I hear parties at night but i am not going to dob them in .Rather than police having roadblocks which probably has not reduced transmission it would be so easy for them to patrol streets looking for such risky things.
My wife sees people chatting in supermarkets-would be safe if they chatted outside keeping 2 metres distance .
Some people are really stupid and take risks so I have no problem if prosecutions ensued if others have been endangered .

Sounds like sour grapes, you’ll get to play with your boat again soon ;)

[fish]

[QUOTE=huxley;813902]Sounds like sour grapes, you’ll get to play with your boat again soon ;)[/QUOT

Sorry I may have not made myself clear-I was expressing my frustration
I do keep to 2m distancing and have not stopped fishing.
Yet again we hear 2 new cases today and proclaimed linked to St Margarets resthome and household transmission
The truth maybe they were indirectly linked to the resthome and transmission happened through the incompetence of Waitakere Hospital by not ensuring nurses caring for covid-19 patients were adequately protected and no precaution at all to prevent household transmission.
Why single out it was resthome transmission ?
The chain actually started before St Margarets and continues beyond but we are made to believe its resthome transmission that was the source of the problem .
The general public will believe its rest homes that are the problem when it is more to do with govt and Health Departments not taking effective measures and not admitting to mistakes and shifting the blame.
Oceania has done well to prevent any cases but will be tainted with such reporting.

[dobby41]

I wonder if future generations will look back and think how crazy it is that we didn't know if people had died from C19 or something else. It sounds like I'm ready a piece of history from war times or something.

Many countries have looked at how many extra deaths they have had above 'normal'.
In NZ, with so few deaths due to covid-19, that would be statistically difficult as 21 deaths would be in the noise.
I think we do know if people die of c19 - we just don't know when they might have died of underlying health issues (1 month? 1 year? 5 years?).

[Maverick]

It will be interesting whether today ,or this week, is when our "seller" finishes up and finally OCA has the foot taken off the back off its neck.

[Balance]

It will be interesting whether today ,or this week, is when our "seller" finishes up and finally OCA has the foot taken off the back off its neck.

Sellers who bought when the sp fell out of bed in March still have around 8m shares more to go by my estimate.

So don't hold your breath - unless they decide that they can fetch higher prices by holding off.

[Ggcc]

Sellers who bought when the sp fell out of bed in March still have around 8m shares more to go by my estimate.

So don't hold your breath - unless they decide that they can fetch higher prices by holding off.
Or hold onto their shares for longterm. Anything under 60 cents was a bargain by the looks.

[Maverick]

So don't hold your breath -.

At 75 cents I can hold my breath forever.
5% p/a Divi....nowhere else I'd rather be

[SCOTTY]

At 75 cents I can hold my breath forever.
5% p/a Divi....nowhere else I'd rather be

How safe is your divi?

[RTM]

At 75 cents I can hold my breath forever.
5% p/a Divi....nowhere else I'd rather be


How safe is your divi?

I'm completely with you Maverick....as long as the dividend holds at around the 4.5-5% level
Topped up last week.

[Maverick]

How safe is your divi?
Fair consideration SCOTTY, with what other companies are doing ATM.

Rather than me spout off all the reasons why I think OCAs cashflow supports paying the usual divi, how about you outline why they wouldn't.

Dont get me wrong, I'm not trying to be adversarial, you my have some good points I just can't see.

They are bound to forge ahead with a cap raise as foreshadowed in HY1 (pre covid) to compliment their overdraught but I'm sure they were never intending to reduce the divi as part of that capital rearrangement.

[SCOTTY]

Fair consideration SCOTTY, with what other companies are doing ATM.

Rather than me spout off all the reasons why I think OCAs cashflow supports paying the usual divi, how about you outline why they wouldn't.

Dont get me wrong, I'm not trying to be adversarial, you my have some good points I just can't see.

They are bound to forge ahead with a cap raise as foreshadowed in HY1 (pre covid) to compliment their overdraught but I'm sure they were never intending to reduce the divi as part of that capital rearrangement.

Thanks Maverick. That is my question. I would like to know if we are still likely to continue getting dividends at present? Are their units and services likely to generate sufficient cash to cover expenses and pay dividends?
Cheers

[Maverick]

Hi Maverick, are you referring to potential retail bond issue mentioned in OCA H1 presentation (not an equity raise)?
Yeah Mogul, that's it. It's is NOT a looming share issue.
its just one line and actually really hard to find in the various forms of 1HY presentations, so well done for spotting it too.

[Maverick]

Thanks Maverick. That is my question. I would like to know if we are still likely to continue getting dividends at present? Are their units and services likely to generate sufficient cash to cover expenses and pay dividends?
Cheers
They just might hold back a bit of divi cash to be prudent but there is no liquidity problem either this year or the next, barring a property crash or large outbreak. All income OCA streams are very stable, even with no new and resales of ILU's during level 4, there is still no cashflow issue.
There will be extra COVID expenses but there is mitigating govt money coming for that so we are told.

So if Earle is conservative he might hold back a bit of moola although this is unnecessary barring a property collapse. However I do not imagine he is that way, he yacht races for fun so that means he knows how to take a calculated risk to get an edge.

In a nutshell , there is a chance the divi will be trimmed purely as a precaution but personally I think Earle will use this time to demonstrate the robustness of the model.

Disc , I don't know Earle personally , just assumptions on my part

[SCOTTY]

Thanks Maverick. Appreciate your opinion :)
Cheers

[Beagle]

They just might hold back a bit of divi cash to be prudent but there is no liquidity problem either this year or the next, barring a property crash or large outbreak. All income OCA streams are very stable, even with no new and resales of ILU's during level 4, there is still no cashflow issue.
There will be extra COVID expenses but there is mitigating govt money coming for that so we are told.

So if Earle is conservative he might hold back a bit of moola although this is unnecessary barring a property collapse. However I do not imagine he is that way, he yacht races for fun so that means he knows how to take a calculated risk to get an edge.

In a nutshell , there is a chance the divi will be trimmed purely as a precaution but personally I think Earle will use this time to demonstrate the robustness of the model.

Disc , I don't know Earle personally , just assumptions on my part

I concur with your viewpoint 100% mate.
To me it doesn't matter one way or the other if they hold back some or all of the next dividend as a one-off precautionary measure, and I am sure it doesn't bother you either. What matters is that this will be a one-off and the long term sustainability of the gross yield of 6.5% is not in question and is absolutely outstanding considering the long term growth characteristics of the industry and the robustness and defensive nature of the needs based care model OCA have in particular.
Underlying earnings of around 8.5 - 9.0 cps puts them on a normal year underlying PE of just 8.5. Hmmm

[percy]

I concur with your viewpoint 100% mate.
To me it doesn't matter one way or the other if they hold back some or all of the next dividend as a one-off precautionary measure, and I am sure it doesn't bother you either. What matters is that this will be a one-off and the long term sustainability of the gross yield of 6.5% is not in question and is absolutely outstanding considering the long term growth characteristics of the industry and the robustness and defensive nature of the needs based care model OCA have in particular.
Underlying earnings of around 8.5 - 9.0 cps puts them on a normal year underlying PE of just 8.5. Hmmm

Just think of an "enforced DRP"where all shareholders are treated equally.
No problem...lol.

[Ggcc]

Some big numbers getting sold and purchased after the news that on Thursday we will be in alert level 2. How that effects Oceania I do not know, but I do know that staff who are doing refurbishments may not be allowed to operate. Onward and upward to $1 hopefully.

[Beagle]

A little birdie tells me OCA will have ongoing very strict rules about visitation under Covid 19 level 2 protocols. Indicative measures as outlined to village managers are:-
Visits will be by 30 minute appointment, held in a place designated and supervised by management with strict decontamination procedures after each appointment.
Maximum of 2 family members allowed to attend, no hugging or touching.

Sounds very tough but I share this info from a discussion I had on the weekend with a very well respected OCA village manager to give investors some assurance as to how seriously OCA are continuing to take this matter and the steps they're taking to protect vulnerable residents.

Disc: I bought more OCA and MET today.

[Blue Skies]

A little birdie tells me OCA will have ongoing very strict rules about visitation under Covid 19 level 2 protocols. Indicative measures as outlined to village managers are:-
Visits will be by 30 minute appointment, held in a place designated and supervised by management with strict decontamination procedures after each appointment.
Maximum of 2 family members allowed to attend, no hugging or touching.

Sounds very tough but I share this info from a discussion I had on the weekend with a very well respected OCA village manager to give investors some assure as to how seriously OCA are continuing to take this matter and the steps they're taking to protect vulnerable residents.

Disc: I bought more OCA and MET today.


Thanks Beagle, appreciate your sharing.

[Cyclical]

A little birdie tells me OCA will have ongoing very strict rules about visitation under Covid 19 level 2 protocols. Indicative measures as outlined to village managers are:-
Visits will be by 30 minute appointment, held in a place designated and supervised by management with strict decontamination procedures after each appointment.
Maximum of 2 family members allowed to attend, no hugging or touching.

Sounds very tough but I share this info from a discussion I had on the weekend with a very well respected OCA village manager to give investors some assurance as to how seriously OCA are continuing to take this matter and the steps they're taking to protect vulnerable residents.

Disc: I bought more OCA and MET today.

Hopefully most of the residents can understand the reasoning for the strict measures...must be tough for some of them.

Looks like any opportunity to grab a few more OCA @73 or so may have slipped away. Great to see some upward momentum after about 3 weeks of heavy selling. Back into 8x by the end of the week, or have I just jinxed it?

[value_investor]

Bought twice on the way up. Once at 44c and again at about 68c. I see this going back upto a $1 in the next 12 months at. Its a good time to test the 'needs based' theory now. General housing demand should be down, OCA theoretically should be more unaffected the others. We'll see with time.

The 'break' might actually give the supply side a breather. A lot of saturation with so many units coming onto the markets in the sector.

Likely hold that 44c position in the long term. Will reduce my holdings once it gets over the $1 mark again. I like this one but not enough to hold a huge position in for the long term. The care sides long term ability to generate net positive cash flow growth is my biggest concern.

[nztx]

What happened to the magical 'Buck' level with this one ?

Did most get badly distracted elsewhere & forget about OCA, while writing out the Cap Raise cheques for a variety of other urgent more loudly screaming potential basket cases ?

[kiwico]

Bought twice on the way up. Once at 44c and again at about 68c.....Likely hold that 44c position in the long term.

I used to think like this too* - I'd treat two lots of the same share differently and sell the higher price lot because the lower price lot made it look like I was doing better. But in reality you now just have a one larger lot made up of two or more purchases. Moving away from fixating on the cost price and more towards what the shares you hold are worth (as in under- or over-valued) can help with this.

* I'm not saying I don't still do this but I try not to.

[winner69]

If Earl tells Liz that shareholders want a decent divie this year you’ll get one

I’ll have a quiet word with my mate Alan as well.

No worries

[nevchev]

Hopefully most of the residents can understand the reasoning for the strict measures...must be tough for some of them.

Looks like any opportunity to grab a few more OCA @73 or so may have slipped away. Great to see some upward momentum after about 3 weeks of heavy selling. Back into 8x by the end of the week, or have I just jinxed it?
Looks like you may still have a chance.Some healthy sales gone thru but the wall remains

[Balance]

Looks like you may still have a chance.Some healthy sales gone thru but the wall remains


Sellers who bought when the sp fell out of bed in March still have around 8m shares more to go by my estimate.

So don't hold your breath - unless they decide that they can fetch higher prices by holding off.

4.4m done yesterday & 1.76m so far today - looks like getting towards the tail end of the selling by those who bought at bargain basement prices in March?

[Ggcc]

Hopefully that 500,000 plus shares @76 cents is the tail end of the dump.

[Timesurfer]

Hopefully that 500,000 plus shares @76 cents is the tail end of the dump.

Might be wishful thinking by the looks. Someone has deep pockets when it comes to dishing these out.

[Ggcc]

Might be wishful thinking by the looks. Someone has deep pockets when it comes to dishing these out.
Absolutely wishful thinking. By the looks the dumping continues. Oh well gives me more time to save for the top up. This share should be NTA by Christmas, unless house prices plummet. Who knows, but a great longterm hold.

[nevchev]

Some big sell and buys going thru now so working of the figures supplied by balance we should start to see some upward pressure.For my money this is as safe a bet as any other sector.Another 4 ml traded so im thinking this pup has begun to awaken.cheers

[Poet]

Also, OCA has just been included in the MSCI Global Small Cap Index. I guess the free float increased substantially when Macquaries left the register and this let OCA make the cut for inclusion.

[nevchev]

We still have a bit of a wall to get thru between 75 and 78 but i get the feeling we are now heading in the right direction.We may see another run similar to the recovery from 40 to 70c.AIMHO

[winner69]

A new craze is emerging ..... a profit measure called EBITDAC

take out Covid impacts and report that as your profit

Good trick for the new Oceania cfo to use

[Sideshow Bob]

Dipped my toe into the OCA water......

[Entrep]

A new craze is emerging ..... a profit measure called EBITDAC

take out Covid impacts and report that as your profit

Good trick for the new Oceania cfo to use

lol. When EBITDACE?

Earnings without expenses

[Beagle]

A new craze is emerging ..... a profit measure called EBITDAC

take out Covid impacts and report that as your profit

Good trick for the new Oceania cfo to use

Not really a "craze" though is it. I think knowing what operating profit would have been without specific Covid 19 costs is useful information as hopefully that gives investors a better handle to assess fair value based on normalised profit. (One would hope Covid 19 costs won't be with us indefinitely).

[winner69]

Not really a "craze" though is it. I think knowing what operating profit would have been without specific Covid 19 costs is useful information as hopefully that gives investors a better handle to assess fair value based on normalised profit. (One would hope Covid 19 costs won't be with us indefinitely).

Lots of work for Snoopy coming up ‘normalising’ and ‘covidising’ things

[Beagle]

I'm really "looking forward" to that.

[Lease]

Not really a "craze" though is it. I think knowing what operating profit would have been without specific Covid 19 costs is useful information as hopefully that gives investors a better handle to assess fair value based on normalised profit. (One would hope Covid 19 costs won't be with us indefinitely).

Good point, provided the company don't go bust.

[peat]

I'm really "looking forward" to that.

This post contains forward looking statements
These statements are based on current expectations and are subject to a number of material risks and uncertainties that could cause actual results and performance to differ
No representation or warranty, express or implied, is made or given


PS covidize revenue as well, get the full story!

[Beagle]

This post contains forward looking statements
These statements are based on current expectations and are subject to a number of material risks and uncertainties that could cause actual results and performance to differ
No representation or warranty, express or implied, is made or given


PS covidize revenue as well, get the full story!

I agree 100%. If you're going to normalise profit for the effects of C you should account for all factors.

[youngatheart]

And for every buyer at 74c there is a seller... Is this intentional price suppression to keep the price down so that those that need to buy for their MSCI cap thingy can do it at a cheaper price?

[Beagle]

https://www.bing.com/videos/search?q=looking+into+the+abyss+quote&docid=608047277284655335&mid=9B2DAEF30578F7A8285D9B2DAEF30578F7A8285D&view=detail&FORM=VIRE

Its been an interesting 9 days to say the least. I got a moderate fever on Wednesday last week that persisted for several days. By Sunday I worked myself into quite a state mentally, physically, emotionally and psychologically. I'm 60 next year and have high blood pressure so definitely in the at risk group. I went and got tested on Sunday. By this Monday I was felling considerably better, temperature had come down and the negative test result that came through on Monday afternoon was a considerable relief.

While staring into the abyss of "what might happen" for days on end I saw some interesting things. My whole life ran before me while in fever and I saw some things I don't like and need to change....perhaps I will share more on this another time, maybe not.

Anyway...I have had quite an epiphany on this stock which I thought I would share.
Going into the early stages of a global recession one really must differentiate between companies that provide needs based services and those that provide wants based services. The needs based (predominantly Govt funded model) OCA use is in my opinion, by a significant margin, the most resilient of the business model's employed by those in the sector. I think they are very well positioned to weather the Covid 19 storm and to continue the transformation of their business model towards care suites and generate enhanced returns over time

With interest rates plumbing unchartered territory you can afford to have almost unlimited patience receiving a dividend yield of 6.6% which I think is sustainable and will grow gradually over time. Their cash flow was up nicely at a 21% increase for the half year and at 74 cents this is on a historical underlying PE of just 9.0 based on last year's result making OCA on an earnings basis the cheapest in the sector, cheaper even than MET.

Looking ahead 86% of their future developments are already consented and they have stated they can slow down their development model without penalty.
Future developments will be undertaken in a "prudent" manner. Earl is a smart guy, holds both Law and Commerce degree's. They have a good board and many have large stakes in the company. The company has an excellent reputation for late stage care. This really matters a lot to me. Its not all about money.
There is a solidness to their operation I really like...I can't articulate if, it just feels safe and solid to me.

Looking into the abyss taught me that all vulnerable people really want is somewhere warm and comfortable where they are cared for really well and treated with respect and dignity. Previously I thought Earl was not commercial enough for me, too soft and caring. Now I feel this is actually what I am looking for in a CEO and I think he's the perfect guy to lead OCA. Previously it worried me that OCA put residents first, second third fourth and fifth and shareholders came a long and lonely last.
Now this is the sort of company I want to invest in again with gusto. I guess when a man stars into the abyss the abyss stars into him and you find your character.
This is the sort of company ethos I admire, where residents welfare is their primary consideration and always will be.

And finally a thought I had on the possible MET takeover. If the MET takeover fails this is unaffected as they have very different business models and the 6.6% yield continues and I can fully understand why Maverick is as happy as a pig in mud to just sit there and enjoy that yield forever and a day.
If the MET takeover succeeds, OCA will be the only stock in this sector left trading at a significant discount to NTA and should get a nice boost as investors look to reallocate their invested funds.

I had another look through the half year result today and the recent investor presentation. Very solid results and they are very well positioned. I am sure I don't need to post links to those reports. Finally, Macquarie have gone. I guess we were right all along, "you can't have too many"...just the timing was wrong.
Disc: I have been buying a few in recent days.

[Blue Skies]

V sorry to hear you've been through the mill Beagle, good to hear you're recovering & obviously a massive relief to test negative.
Appreciate your excellent post.

[Chinesekiwi]

Thanks Beagle - that is a solid read and also glad you are well.

Top post.

[winner69]

Beagle ... you poor bugger but glad you over it. Just take care of yourself now you are an old bugger.

I wouldn’t mind if Oceania profits went backwards for a few years and they paid no divies.

Lockdown reflections are good - like I keep reading this bit I found and agreeing with it:



The world in a sorry state today because guru economist Milton Friedman and his followers said “the only responsibility of business is to maximize short term profits, regardless of the social and environmental costs.”


We’ve got to change that “Maximize short-term profits, regardless of the social and environmental costs” attitude to “maximize long-term benefits for all people and nature.”

So I’m all for Oceania maximising long term benefits for all us - stuff this maximising shareholder profits stuff in next year or two .....even if you have a few years without dividends

[peat]

Beagle, just one point I want you to be clear on though.
OCA do not have a cure for schizophrenia.

PS glad you are good.

Mods
have you considered insuring his life?

[Beagle]

Thanks folks. No experience in life is wasted especially the ones that force you to reevaluate what's really important.

On the dividend thing Winner. I see no reason why OCA can't continue their dividends. Providing the very best standards of care and rewarding shareholders for their investment are definitely not mutually exclusive matters. (To illustrate my point this has the highest yield in the sector at 6.6%, ARV 4.3%, SUM 2.4%, RYM 1.9%, and MET 1.7% but arguably amongst the very best standards in the industry for care).

LOL Peat, I'm okay...but is was really scary.

[dibble]

Beagle ... you poor bugger but glad you over it. Just take care of yourself now you are an old bugger.

I wouldn’t mind if Oceania profits went backwards for a few years and they paid no divies.

Lockdown reflections are good - like I keep reading this bit I found and agreeing with it:




So I’m all for Oceania maximising long term benefits for all us - stuff this maximising shareholder profits stuff in next year or two .....even if you have a few years without dividends

...and of course there's a school of thought that has that as its mantra, ie focus on customers and product rather than quarterly performance (shareholders) and reap the long term rewards. MFT springs to mind.

[Leftfield]

Beagle ... you poor bugger .....
So I’m all for Oceania maximising long term benefits for all us - stuff this maximising shareholder profits stuff in next year or two .....even if you have a few years without dividends

Crikey Winner you really hit the dividend hound while he is down. No div's perish the thought!!.

Beagle my best wishes for a speedy recovery. Remember the 'health is wealth' mantra.

FWIW I've stocked up on a few OCA this week. A rare incursion into div/yield territory for me. Interesting times.

[RTM]

And finally a thought I had on the possible MET takeover. If the MET takeover fails this is unaffected as they have very different business models and the 6.6% yield continues and I can fully understand why Maverick is as happy as a pig in mud to just sit there and enjoy that yield forever and a day.
If the MET takeover succeeds, OCA will be the only stock in this sector left trading at a significant discount to NTA and should get a nice boost as investors look to reallocate their invested funds.



And this in a nutshell is why I have hesitated to jump into Met. Capital Gain, while very tasty, is not something we routinely have on our dinner menu. We prefer Dividends. And lots of them !
Pleased you are feeling better Beagle....worrying times. I had a friend who had to go to hospital with pneumonia...was really worried. But that is what it turned out to be and he is home recovering now.
Cheers, RTM
PS I also meant to say, thanks for the analysis.

[RTM]

Beagle ... you poor bugger but glad you over it. Just take care of yourself now you are an old bugger.

I wouldn’t mind if Oceania profits went backwards for a few years and they paid no divies.

So I’m all for Oceania maximising long term benefits for all us - stuff this maximising shareholder profits stuff in next year or two .....even if you have a few years without dividends


I wouldn't mind betting many of OCEANIAS customers are also share holders. So continuing to pay a dividend is probably on the cards....Need to look after and care for both groups of stakeholders.

[Joshuatree]

LifeShocks are a wonderful time to reflect, review, discard all the crapp thats suddenly so easy to see, verify the truth and whats really important and refocus, renew recommit to it.You lucky bugger. thanks for the OCA thoughts beagle.

All i got was instant watering eyes as the twiddled the swab around in my head. I was absolutely convinced i was clear but have a little cough and tickle in my chest, but i ran 5 km the day before at steady pace no issues. They never even contacted me re the results.A family member who tested the same time with me got texted in 2 days exact to say test negative.Then ph called by someone else hours later who didnt know family member had already been cleared. I ended up ringing them to get my result! Went to first cafe today, hint take your own pen to sign in i

[Beagle]

Many thanks indeed for your kind words folks. My temperature has been normal for 4 days now and I have felt quite well and been for a couple of good walks. Appetite nearly back to normal too.

[RGR367]

Many thanks indeed for your kind words folks. My temperature has been normal for 4 days now and I have felt quite well and been for a couple of good walks. Appetite nearly back to normal too.

And we're glad you're good. It's good for you to be worried sick to write a lengthy post though :cool: Thanks again but seriously get your self a dog to do the worrying for your health.

[Beagle]

Mrs Beagle was surprisingly little help. (harden up, you'll be right...even called me a hypochondriac at one point, that got me VERY grumpy). I think after 7 weeks of lockdown together its fair to say we've got on each others nerves a bit and I wouldn't mind speculating there's a few other people that feel the same way about their partners lol. Agree, Its time to get a Beagle that really cares. If anyone knows of a cute tri coloured Beagle puppy please Pm me.

[limmy]

Many thanks indeed for your kind words folks. My temperature has been normal for 4 days now and I have felt quite well and been for a couple of good walks. Appetite nearly back to normal too.Glad you're back to normal Mr. Beagle. We need you to continue your excellent postings here, so stay safe and stay healthy.

[King1212]

Oh master Beagle..plz do look after yourself!

[davflaws]

Mrs Beagle was surprisingly little help. (harden up, you'll be right...even called me a hypochondriac at one point, that got me VERY grumpy).

I have been married to a Dr and a nurse - if you want sympathy, a tax inspector or a prison warder would be preferable. I think females are genetically wired so they are unable to understand men's suffering with "manflu". Now that you are better - Go to sea!

[macduffy]

I have been married to a Dr and a nurse - if you want sympathy, a tax inspector or a prison warder would be preferable. I think females are genetically wired so they are unable to understand men's suffering with "manflu". Now that you are better - Go to sea!

Now that's a big conclusion to draw from a survey of only two! Better wait until you have more experience of the matter!

;)

[dobby41]

And this in a nutshell is why I have hesitated to jump into Met. Capital Gain, while very tasty, is not something we routinely have on our dinner menu. We prefer Dividends. And lots of them !

Just sell a few shares in lieu of a dividend.

[RTM]

Just sell a few shares in lieu of a dividend.

Recognise that I can do that.....it feels like the reverse of compound interest if I was to.

[King1212]

Fundies finished off loading?

[nevchev]

Fundies finished off loading?

Salts disclosure goes a long way to explaining what has been going on.Not sure what they paid for the shares but the DRP would have gone a long way to cushioning any loss from the 12ml they have sold.Onward and upward!!

[Cyclical]

Salts disclosure goes a long way to explaining what has been going on.Not sure what they paid for the shares but the DRP would have gone a long way to cushioning any loss from the 12ml they have sold.Onward and upward!!

If we can conclude from that that most of them have been sold since the 21st of April, then that would certainly help explain it. Still a bit of a cloud there regarding the remaining 33 million they have...hopefully that's a long term hold.

[rooster]

Interesting that they have been unloading at a loss since they had been busy buying at the end of Jan when share price was >$1.20. Do they know something we don't?

[Beagle]

Interesting that they have been unloading at a loss since they had been busy buying at the end of Jan when share price was >$1.20. Do they know something we don't?

Salt like many other institutions will have had many redemption requests from clients and requests for transfers from growth funds to balanced and conservative funds. They have probably had to liquidate some of their shares. That's how I see it.

[nevchev]

Interesting that they have been unloading at a loss since they had been busy buying at the end of Jan when share price was >$1.20. Do they know something we don't?

Maybe they where playing the DRP and got caught napping by covid as many did.Havnt done the math but they still have a fear wack of them

[Cyclical]

Interesting that they have been unloading at a loss since they had been busy buying at the end of Jan when share price was >$1.20. Do they know something we don't?

They may well have bought a chunk when they were sub 60c too though, right?

[bottomfeeder]

Off topic but it is a proven fact men get the flu worse than women.
I see Rich Dad Poor Dad, Robert is saying when the fake money starts getting into the economy, don't save it. So I say who cares about dividends, its profit and capital growth and a hedge against hyper inflation I am wanting. Gresham's Law states that good money follows bad. With all the fake money starting to circulate, cash is what you dont want.

[winner69]

Salt like many other institutions will have had many redemption requests from clients and requests for transfers from growth funds to balanced and conservative funds. They have probably had to liquidate some of their shares. That's how I see it.

Salt seems to have less investors in their funds now compared to December

Probably correlated to their returns :eek2:

[nevchev]

They may well have bought a chunk when they were sub 60c too though, right?

Possibly to much exposure to one sector that if things hadnt worked out for aged care in nz the wheels may have come off(covid infection wise)

[winner69]

Possibly to much exposure to one sector that if things hadnt worked out for aged care in nz the wheels may have come off(covid infection wise)

In their Long Short Fund Ryman is their largest short

[nevchev]

In their Long Short Func Ryman is their largest short

I didnt know that winner.Talk about a juxta position.Makes no sense to me

[nevchev]

Some big sell and buys going thru now so working of the figures supplied by balance we should start to see some upward pressure.For my money this is as safe a bet as any other sector.Another 4 ml traded so im thinking this pup has begun to awaken.cheers
Wrong ...again.This is beyond a joke.See ya in the spring

[winner69]

Wrong ...again.This is beyond a joke.See ya in the spring

You factoring in churn ....same shares doing the rounds like

[nevchev]

You factoring in churn ....same shares doing the rounds like

Hahaha,just having a laugh at myself.Im in no particular hurry.Why would Salts buy into two companies in the same sector and short one of them winner?Cant figure it out

[Beagle]

Hahaha,just having a laugh at myself.Im in no particular hurry.Why would Salts buy into two companies in the same sector and short one of them winner?Cant figure it out

Probably because they think RYM is heavily overpriced and trading on past glory when really their growth rate has been nothing special in the last 5 years, (14% per annum average), slower even than MET's growth rate ! Possibly because you can buy a good company like this on a PE of 9 and RYM is on around three times that.

[nevchev]

Probably because they think RYM is heavily overpriced and trading on past glory when really their growth rate has been nothing special in the last 5 years, (14% per annum average), slower even than MET's growth rate ! Possibly because you can buy a good company like this on a PE of 9 and RYM is on around three times that.

Cheer Beagle,thats the only conclusion i could reach but seems their robbing paul to pay merry.....To be honest i didnt know you could short on the nz market.I have experienced it alot on the asx and found it distasteful and counter productive

[winner69]

From their December update

While Ryman was an annoying detractor, the Fund did very well out of the NZ retirement village sector thanks to the large longs we had built up in Oceania Healthcare (OCA, +22.2%) and Metlifecare (MET, +17.0%). We had bought these when they were somewhat friendless in the June to September period, with MET trading in a range of $4.30-$4.50 compared to the somewhat fortunate takeover bid that came in at $7.00 during the month. The two lessons from this were that you make your luck by playing in the right places and that these names were very weak when the Auckland housing market had only slowed down slightly, with the rest of the country still being strong. Woe betide the sector when there is a sustained housing pullback and the premium multiples attached to the rapid developers, Ryman and Summerset, come under scrutiny. That is not our near-term expectation and we a

[winner69]

They’ve also said this

The largest headwind was a holdover from November in the form of Ryman (RYM, +8.2%). As discussed then, their H1 result was actually quite weak. A notable uptick in inventory leaves them facing a tough task to sell the major development deliveries that they have planned for the second half. However, this mattered little in the face of a perception that NZ and Melbourne housing is turning up and a takeover bid for Metlifecare which put a rocket under the entire sector. Never mind that the MET bid was at book value, whereas Ryman trades at 3.4x book value. Better hope their developments keep getting delivered and sold. Our scepticism regarding book values in the sector is long-standing given that they bear little relationship to the free cashflows generated in the individual village accounts.

[nevchev]

They’ve also said this

The largest headwind was a holdover from November in the form of Ryman (RYM, +8.2%). As discussed then, their H1 result was actually quite weak. A notable uptick in inventory leaves them facing a tough task to sell the major development deliveries that they have planned for the second half. However, this mattered little in the face of a perception that NZ and Melbourne housing is turning up and a takeover bid for Metlifecare which put a rocket under the entire sector. Never mind that the MET bid was at book value, whereas Ryman trades at 3.4x book value. Better hope their developments keep getting delivered and sold. Our scepticism regarding book values in the sector is long-standing given that they bear little relationship to the free cashflows generated in the individual village accounts.

Thanks for that.Its an interesting insight into the workings of an investment firm

[winner69]

Remember this from an AR


"Generally, the shares under the 2017 LTIP Scheme will be eligible to vest if, at the vesting date (which is the business day after release of the financial statements for the year ended 31 May 2020), the participant remains employed by Oceania and the performance hurdles are achieved. The performance hurdles require Oceania’s performance to meet, or exceed, an underlying Earnings per Share Compound Annual Growth Rate ("EPS CAGR") of 35% per annum or greater, over the three year period to 31 May 2020."

I don’t think the ‘rules’ have changed.

My calculations reckon that hurdle is Underlying Earnings of 13.8 cents/share or about $84m for this year ended 31May.

Forecasts by some on this thread suggest a big fail coming up

So no shares under the 2017 LTIP ....bugger for Earl.

But you never know ...corporates these are soft as will probably say there’s been extenuating circumstances and Earl and his team have done a stupendous job so we will fix him up somehow.

Aligning managers interests with shareholders eh.

[Beagle]

Bought even more today for reasons previously stated. Doing a Couta1. Maverick and Couta1 will be proud of me.

[Baa_Baa]

Bought even more today for reasons previously stated. Doing a Couta1. Maverick and Couta1 will be proud of me.

Me too, relatively speaking. :t_up:

[Cyclical]

Bought even more today for reasons previously stated. Doing a Couta1. Maverick and Couta1 will be proud of me.

Contemplating it myself but already makes up about 50% of my portfolio...does that put me in the Couta1 camp? Doesn't look like my buy at for the last few days at 74c is going to get hit and do I want to reach higher? Looks like Salt may have been the culprits for the sell down and have done their dash :)

[Beagle]

Yes, Couta1 and Maverick would be very proud, you can't have too many :t_up:

[Cyclical]

Yes, Couta1 and Maverick would be very proud, you can't have too many :t_up:

Hmm, only if you can give me assurances it fits within the "heads you win, tails you don't lose" camp...

[Beagle]

Hmm, only if you can give me assurances it fits within the "heads you win, tails you don't lose" camp...

See my post #2511 in the MET thread for my thoughts on that. There are no guarantees however...but on the balance of probabilities, its looks good and I am voting with both feet. For what its worth I have double the $ amount in OCA than I presently have in MET.

[Cyclical]

For what its worth I have double the $ amount in OCA than I presently have in MET.

Yeah, me too as it happens. I made the comment a week or two ago in the MET thread that I think a 33% gain in OCA is probably a safer bet than MET, and that's reflected in my holdings. Both have been great to me since March though, except for the bit where I didn't by enough at the time :)

[Beagle]

Great minds think alike !

[clearasmud]

Great minds think alike !
I must be a great mind too!

[Scrunch]

Hahaha,just having a laugh at myself.Im in no particular hurry.Why would Salts buy into two companies in the same sector and short one of them winner?Cant figure it out

Because its reduces your invested capital into the sector and has the potential to generate very high returns on your net capital invested. SALT may be buying what they think is the cheap half of a paring but using the RYM/OCA pairing. There is a lot more discussion on this forum around the Couta theorm involving SUM and RYM and 50%. If both continue to move in parallel then you simply get the returns the sector offers. If the gap narrows, your returns are a lot higher. If the gap widens you do worse from the increased leverage.

Lets say you think RYM should be 10x OCA's price as (occurred in late November 2018). On 5 May 2019 you observe the prices OCA @ $1.00 and RYM at $12.06. You want to invest a net $10m.

Option1: Invest $10m in OCA.
Option2: Invest $30m in OCA and short $20m in RYM (or 1.66m shares) for a $10m net investment.

If OCA were to then increase to $1.20 you make $2m in option1.
Under option2 you could make $6m (if RYM didn't increase) from an OCA increase to $1.20. Even if RYM increased, but stayed below $14.47 your returns are still higher than just doing an option 1 purchase.

[Cyclical]

Because its reduces your invested capital into the sector and has the potential to generate very high returns on your net capital invested. SALT may be buying what they think is the cheap half of a paring but using the RYM/OCA pairing. There is a lot more discussion on this forum around the Couta theorm involving SUM and RYM and 50%. If both continue to move in parallel then you simply get the returns the sector offers. If the gap narrows, your returns are a lot higher. If the gap widens you do worse from the increased leverage.

Lets say you think RYM should be 10x OCA's price as (occurred in late November 2018). On 5 May 2019 you observe the prices OCA @ $1.00 and RYM at $12.06. You want to invest a net $10m.

Option1: Invest $10m in OCA.
Option2: Invest $30m in OCA and short $20m in RYM (or 1.66m shares) for a $10m net investment.

If OCA were to then increase to $1.20 you make $2m in option1.
Under option2 you could make $6m (if RYM didn't increase) from an OCA increase to $1.20. Even if RYM increased, but stayed below $14.47 your returns are still higher than just doing an option 1 purchase.

Nice explanation there, Scrunch. Is that effectively what peat is referring to over at the MET thread when talking about Salt?

being short RYM likely means that they can go hard on the long side of the equation as sectoral risk is greatly reduced - something a fund will have to bear in mind

[winner69]

Hahaha,just having a laugh at myself.Im in no particular hurry.Why would Salts buy into two companies in the same sector and short one of them winner?Cant figure it out

Hey nev

Ryman may be Salts largest short but Turners is on of their largest longs

Seems they have more in Turners than Oceania

[fish]

Bought even more today for reasons previously stated. Doing a Couta1. Maverick and Couta1 will be proud of me.

I think this is really good timing and the chance of it hitting 85 cents in the next 4 weeks is many times higher than the chance of falling 5 cents to 70.
Next year more chance hitting $1.20 than falling to 50 cents.
All the main retirement villages have proven to be safe in this crisis and the changing demographics will ensure future demand.

The lockdown has eliminated corvid-19 with the danger of this hitting Oceania or met so in my opinion a good time to buy before most investors start to look to invest again.

[Onion]

I think this is really good timing and the chance of it hitting 85 cents

That would suit me just fine as that is my average cost, having doubled down with a 47c buy in March.

[Beagle]

I think this is really good timing and the chance of it hitting 85 cents in the next 4 weeks is many times higher than the chance of falling 5 cents to 70.
Next year more chance hitting $1.20 than falling to 50 cents.
All the main retirement villages have proven to be safe in this crisis and the changing demographics will ensure future demand.

The lockdown has eliminated corvid-19 with the danger of this hitting Oceania or met so in my opinion a good time to buy before most investors start to look to invest again.

Thanks Fish. I have been searching hard for reliable dividend yield which I can set and forget and yield that will grow over time in my retirement, (I want to retire in the next few years). Its really hard to find stocks that fit this bill in the current circumstances. At 78 cents its on a yield of 6.3% and taking a long term view its highly likely that dividends will grow in the years ahead.

[nevchev]

Hey nev

Ryman may be Salts largest short but Turners is on of their largest longs

Seems they have more in Turners than Oceania

Never really been enthusiastic about turners.had a couple of bad experiences with them as a young fella buying cars

[Cyclical]

I think this is really good timing and the chance of it hitting 85 cents in the next 4 weeks...

It was happily trading in the 83-86c range a month ago, so we should be back there in a flash now the downward pressure (presumably from Salt) appears to be gone.

[winner69]

It was happily trading in the 83-86c range a month ago, so we should be back there in a flash now the downward pressure (presumably from Salt) appears to be gone.

Salt still hold quite a few

They tell me that they are now net short this sector.

[nevchev]

Salt still hold quite a few

They tell me that they are now net short this sector.

So does that now mean that its in their best interest if OCA shares take a dive?

[Cyclical]

So does that now mean that its in best interest if OCA shares take a dive?

Long on OCA to the tune of 30 something million shares. Short on Ryman.

[Justin]

miss the boat，will institute dump the shares again？

[Beagle]

It was happily trading in the 83-86c range a month ago, so we should be back there in a flash now the downward pressure (presumably from Salt) appears to be gone.

I agree and the results of Covid 19 testing in the last few weeks and especially most recently have been very encouraging which in my view has de-risked this sector so these are arguably better value in that price range now than they were a month ago. Dividend yield @ 79 cents is still north of 6% (6.2% to be exact).

Have you missed the boat Justin ? At 79 cents they are exactly the same price as the IPO 3 years ago. Nobody can answer your question as they can't tell you what other investors will do. You have to decide for yourself if the opportunity is worth you investing your money. What I think has been very clearly articulated already.

P.S. I very nearly bought even more today...but told myself to take my foot off the throttle for a few days.

[winner69]

Long on OCA to the tune of 30 something million shares. Short on Ryman.

Salt possibly taking a breather until the the next wave of selling

[Cyclical]

miss the boat，will institute dump the shares again？


I agree and the results of Covid 19 testing in the last few weeks and especially most recently have been very encouraging which in my view has de-risked this sector so these are arguably better value in that price range now than they were a month ago. Dividend yield @ 79 cents is still north of 6% (6.2% to be exact).

Have you missed the boat Justin ? At 79 cents they are exactly the same price as the IPO 3 years ago. Nobody can answer your question as they can't tell you what other investors will do. You have to decide for yourself if the opportunity is worth you investing your money. What I think has been very clearly articulated already.

P.S. I very nearly bought even more today...but told myself to take my foot off the throttle for a few days.

Missed the boat? Personally I don't think so. I finished topping up today, after trading out of SUM other stocks I was less comfortable with. Last month I was happy buying at 81 and I think the value at that level remains, or as Beagle says, it's probably stronger than last month as we've now got Covid under control (touch wood). Heaps of support at the current levels...onwards and upwards.

[tommy_d]

Missed the boat? Personally I don't think so. I finished topping up today, after trading out of SUM other stocks I was less comfortable with. Last month I was happy buying at 81 and I think the value at that level remains, or as Beagle says, it's probably stronger than last month as we've now got Covid under control (touch wood). Heaps of support at the current levels...onwards and upwards.
debating buying some more, OCA is now one of my two biggest holdings (the other is SCL). Even though buying now would heavily increase the average price paid per share, it still seems reasonable buying

[Justin]

i trid to bid this week from 0.73 then 0.74 then 0.75，too many bids on the queue.

[Baa_Baa]

i trid to bid this week from 0.73 then 0.74 then 0.75，too many bids on the queue.

Sometimes, when there’s only a 1 cent spread especially, and you want some shares, just buy at market. Imo

Prices can run away from you, they can creep away as well, up or down. Just decide if you want shares and get them, or play the market games if you really reckon you might save or make a few cents. Imo again

[tommy_d]

i trid to bid this week from 0.73 then 0.74 then 0.75，too many bids on the queue.

check the offers and jump the queue if the spread is low and the price is right - if you were prepared to pay 0.75 on the day you bid 0.73 (and i don't think much has really changed this week), then the queue jump would have bought you the shares immediately at 0.74...

[macduffy]

Sometimes, when there’s only a 1 cent spread especially, and you want some shares, just buy at market. Imo

Prices can run away from you, they can creep away as well, up or down. Just decide if you want shares and get them, or play the market games if you really reckon you might save or make a few cents. Imo again

Exactly, Baa Baa!

[mfd]

Sometimes, when there’s only a 1 cent spread especially, and you want some shares, just buy at market. Imo

Prices can run away from you, they can creep away as well, up or down. Just decide if you want shares and get them, or play the market games if you really reckon you might save or make a few cents. Imo again

Good advice. I learnt my lesson holding out for 46c to double my ATM holding 5 years ago. With hindsight, I probably would have done just fine buying at 47c.

[Cyclical]

Good advice. I learnt my lesson holding out for 46c to double my ATM holding 5 years ago. With hindsight, I probably would have done just fine buying at 47c.

Are you predicting the same here with OCA, mfd? I think you did the right thing by not buying at 47c, as that would have been barely more than a 4000% gain. Meh :t_down:

[Beagle]

https://oceaniahealthcare.sharefile.com/share/view/s72b6d6481344e8cb

Well worth downloading and watching. A very strong and resilient business. Dividend yield at 80 cents still just north of 6%.

[dubya]

https://oceaniahealthcare.sharefile.com/share/view/s72b6d6481344e8cb

Well worth downloading and watching. A very strong and resilient business. Dividend yield at 80 cents still just north of 6%.

The only downside I heard was difficulty hiring overseas nurses and carers due to the border being shut. Otherwise business as normal for OCA.
6%+ dividend pretty damn good :D and share price where it was 3 years ago at the IPO. Lots more upside to come I think???!!!!

[Maverick]

The only downside I heard was difficulty hiring overseas nurses and carers due to the border being shut. Otherwise business as normal for OCA.
6%+ dividend pretty damn good :D and share price where it was 3 years ago at the IPO. Lots more upside to come I think???!!!!
Hey Dubya,
most here won't know, OCA have a training business that convert NZ and overseas nurses to NZ RV requirements.
This arm contributes 1-2m income as " other income" every year.
There is an overall strong resistance from NZ nurses to convert to RV but with local doctors now doing online and car park consultations during level4 there are plenty being forced to reconsider their positions.
OCA has placed themselves in the front line to cherry pick the ones they like. Now overseas nurses have dried up we still have a facility that puts us in front of our competitors to assimilate the best nurses up for grabs.
I know that sounds dodgy but you know what I mean.

[Beagle]

A number of highlights of that presentation for me included :-
1. How strong, resilient and flexible their business model is. I didn't realise that they can either sell their care suites under an occupation right agreement model or simply let new people in and charge them a premium room rate of ~ $60 a day and from a financial perspective the returns are not dissimilar. Gives them a lot of flexibility with provision of those services.
2. How needs based this business is. I think Earl really reiterated that for us with how he said when people need care and support they need it, its completely unrelated to the business, housing or economic cycle. Instinctively I knew this already but it was nice to have that point reiterated.
3. The full continuum of care model. They're actually building out quite a lot of independent living apartments over the next few years but I think going forward after this Covid 19 scare people will really be focusing on who really does provide a first class full continuum of care model with plenty of access to care services, (not just a token number of hospital and dementia beds like some other operators)
4. How they can adjust their development model and speed in a prudent manner to the changing circumstances without penalty. (Bewing a bean counter I love that word prudent). The directors and senior management have really meaningful stakes in OCA and Earl is both a qualified lawyer and accountant. Senior leadership really do have their heads screwed on well and truly in my opinion.
5. Robust demand right through the Covid 19 crisis for care suites (essential service). Government pay cheque every fortnight.
6. Nobody who has signed a contract for a new independent living unit before the lockdown has subsequently cancelled. You'd have to say that's very comforting.
7. Covid 19 has really shined the spotlight on the value of the late stage healthcare services that private companies like OCA provide. Augers well for future Govt funding increases.

A "little birdie" tells me Govt funding is going up by more than 3% from 1 July 2020. Probably not enough to cover all extra expenses but it helps.

Yes Covid 19 has presented some challenges But YES OCA have responded to them very well indeed. A LOT to like here. Feels very solid to me.

[dubya]

Hey Dubya,
most here won't know, OCA have a training business that convert NZ and overseas nurses to NZ RV requirements.
This arm contributes 1-2m income as " other income" every year.
There is an overall strong resistance from NZ nurses to convert to RV but with local doctors now doing online and car park consultations during level4 there are plenty being forced to reconsider their positions.
OCA has placed themselves in the front line to cherry pick the ones they like. Now overseas nurses have dried up we still have a facility that puts us in front of our competitors to assimilate the best nurses up for grabs.
I know that sounds dodgy but you know what I mean.

Thanks for that Mav. No, I wasn't aware (and yes I know what you mean lol) .
Earl covered everything else really well I thought.

[youngatheart]

Close of day mid 80c by the look of it!

[Beagle]

Close of day mid 80c by the look of it!

It wouldn't surprise me if we get there in the near term. At 81 cents you're still getting north of a 6% yield which looks reliable and sustainable and buying at a ~ 20% discount to NTA and on a historical underlying PE of just 10. There is no other company in this sector providing those compellingly attractive metrics.

I am back buying even more today. There's nothing I can find on the NZX that I like more than this one.

[King1212]

There is one more Master Beagle.... retirement village starts with M.....

[Beagle]

There is one more Master Beagle.... retirement village starts with M.....

LOL - Good metrics at MET for sure mate but the yield is only 2.5% so if one gets stuck there for years one is counting on capital gain, whereas with OCA @ 6% one has the luxury of infinite patience...what with interest rates going down to very close to zero, 6% is a compelling yield.

P.S. I still have heaps of MET and reckon the odds on some form of settlement are about 50/50.

[Waltzing]

Lost all my OCA profits exiting AIR after being late following the BRILLANT MR B, but managed to buy back in for some at 72C.. about a month ago. There is still a chance of spread from Q Hotels into the wider community. I expect to get those profits back inside a few years and who knows MAYBE AIR becomes a trade again in 2022 , a BIG MAYBE. But right now OCA is a buy for transfer to Trust portfolios but imagine if they make all investments no matter the time frame who know what......$$$ transfering assets to trusts will be a non starter. Lets hope they dont go there. I really dont think labour wants you to know that money is a formula on a computer at the reserve bank. With labour ministers saying rates need to stay up we are really living with policies that could go anywhere...Imagine property prices for rest home operators going down and rates going up? oh dear.

[winner69]

Close of day mid 80c by the look of it!

C'mon mate- show some enthusiasm ....close of 90c by look of it

[King1212]

50/50...well better winning than casino..... or other stocks at the market...black u win...red also u win.... skycity casino does not do that....lol

[JohnnyTheHorse]

Suspect buying is being driven by the move into the MSCI small cap index (up from the micro cap index). Expecting buying pressure until the end of the week.

[Beagle]

Suspect buying is being driven by the move into the MSCI small cap index (up from the micro cap index). Expecting buying pressure until the end of the week.

Thanks. With the free float so dramatically changed from the recent Macquarie sell-down one wonders what other index they might end up getting into ? I am thinking maybe that NZX50 inclusion could be on the cards soon too.

[Cyclical]

Thanks. With the free float so dramatically changed from the recent Macquarie sell-down one wonders what other index they might end up getting into ? I am thinking maybe that NZX50 inclusion could be on the cards soon too.

I thought they managed to get into the NZX50 a year or so ago when I last held OCA...was that only temporary while they were above a buck?

[Cyclical]

Close of day mid 80c by the look of it!

Well done, 84c already...can I please borrow your crystal ball?!

[Joshuatree]

Classic Pump and Dump by some boiler room collective? Although all except MET are performing similarly with 30 DMA approaching/crossing 60 DMA.

[Beagle]

I thought they managed to get into the NZX50 a year or so ago when I last held OCA...was that only temporary while they were above a buck?

I'm not sure. I don't think it would have had the market cap free float for NZX50 inclusion up until about now. Don't know for sure, maybe someone else does ?

[Beagle]

Classic Pump and Dump by some boiler room collective?

Presentation last week at the Macquarie conference was quite impressive. Earl Gasparich really should have worn a decent suit and tie though even though he was presenting virtually, would have looked a lot more professional. Covid 19 numbers are looking quite encouraging...maybe institutional investors are sensing that risk is easing ? Maybe investors have woken up to the 6% yield and the fact that it appears to be sustainable and very high in an ultra low interest rate environment ?

[Joshuatree]

Yes and i added above"Although all except MET are performing similarly with 30 DMA approaching/crossing 60 DMA". OCA leading.

[winner69]

Well done, 84c already...can I please borrow your crystal ball?!

His crystal ball pretty useless ...I told him to show more enthusiasm and say 90

Jeez,everybody will be buying because off its yield AND joining indices is good

Should be buying this week ...probably miss out if one waits much longer

Heck ...NZX50 inclusion is $1.20 material

[Joshuatree]

Pump it Hottie:t_up:

[nevchev]

Pump it Hottie:t_up:
Well spotted Jt.

[bottomfeeder]

You would think I would be happy, but when my spreadsheet shows so many dollars in the black, I get the urge to sell. Being a trader is not so easy. Whoa, a long way to go, and what would you do with the cash - 2%?

[Beagle]

Back to NTA of $1.01 is quite plausible in the next few months, in my opinion.

[BlackPeter]

You would think I would be happy, but when my spreadsheet shows so many dollars in the black, I get the urge to sell. Being a trader is not so easy. Whoa, a long way to go, and what would you do with the cash - 2%?

I guess there are probably worse problems to have ...

Long term I am pretty sure OCA will be more worth than now (which speaks for keeping).

Mid term I am pretty sure OCA will go lower again (which would speak for selling).

Short term I have no clue whats going to happen.

So - for a trader the best option clearly is to sell at the peak and buy back at the bottom :p; What could be easier?

Discl: holding lots (without violating my diversification policies), but ready to pick up some more if and when the crazy sales prices repeat (I think they might).

[Baa_Baa]

Back to NTA of $1.01 is quite plausible in the next few months, in my opinion.

Hard to believe such a deep discount to NTA but for some a great long term buying opportunity. OCA has a tendency to creep away from us, upward currently, you take your eye of it and next thing you know your yield opportunity has halved. Who would’ve thought the COVID would have crashed the price to half of IPO. What a gift.

[winner69]

Back to NTA of $1.01 is quite plausible in the next few months, in my opinion.

The NTA is out of date

Add another 6 months solid trading (second half better than first half they say) and NTA probably over $1.10 now

[Maverick]

Back to NTA of $1.01 is quite plausible in the next few months, in my opinion.
I can't fathom why OCA has stayed this low now Covid has been substantially derisked. Even the laziest analysis shows ALL its peers are trading at their SP values of 10-12 months ago which should equate to OCA being $1.00-$1.05 today.

Beagle, your target of $1.00 in 2 months seems too conservative to me.I'm still picking an underlying Profit of 50m announced in 2 months .If correct , that will put the SP back to $1.20 based on historic metrics.

Black Peter, unless Wall Street poo's itself really bad or covid established itself here I don't see OCA going lower at all. Even at its recent high, 84c just about everything bad is already priced in.

It seems bizarre to me that the company that should win the most post-Covid is the one being the most beaten up. The market has really got this wrong and its nice watch it STARTING to wake up to its error.

[winner69]

We could even get an increased dividend in August ....over 3c final

Could even maintain that 6% yield at share price over a buck

[nevchev]

Wouldnt be silly to take out a small mortgage at fixed rate of 2.something% for 5 years and buying OCA which at 6% would still offer a return of over 3%.Not to mention the capital gain!!!

[Beagle]

I can't fathom why OCA has stayed this low now Covid has been substantially derisked. Even the laziest analysis shows ALL its peers are trading at their SP values of 10-12 months ago which should equate to OCA being $1.00-$1.05 today.

Beagle, your target of $1.00 in 2 months seems too conservative to me.I'm still picking an underlying Profit of 50m announced in 2 months .If correct , that will put the SP back to $1.20 based on historic metrics.

Black Peter, unless Wall Street poo's itself really bad or covid established itself here I don't see OCA going lower at all. Even at its recent high, 84c just about everything bad is already priced in.

It seems bizarre to me that the company that should win the most post-Covid is the one being the most beaten up. The market has really got this wrong and its nice watch it STARTING to wake up to its error.

I hope you are right :) I'm just trying to keep level headed and be a bit conservative and buying for long term yield at 6% that will grow over time. Leaving aside MET (which has a very different business model and issues with the development side of their business) OCA looks outstanding value compared to the others and is the most needs based business model of them all.

Nevchev, If I was a younger chap I would do exactly that. BNZ have just today lowered their 5 year fixed rate to 2.99%. That's a remarkable fixed rate for 5 years and something I never thought I would ever see.

[winner69]

Still reckon there's sum better bets in this sector

[winner69]

Wouldnt be silly to take out a small mortgage at fixed rate of 2.something% for 5 years and buying OCA which at 6% would still offer a return of over 3%.Not to mention the capital gain!!!

Go for it nev, great opportunity

[Justin]

is that oca‘s property valuation will going down like kiwi property in next report？

[nevchev]

Still reckon there's sum better bets in this sector
My first mortgage in the mid 1990s was at over 20%!!!

[BlackPeter]

Black Peter, unless Wall Street poo's itself really bad or covid established itself here I don't see OCA going lower at all. Even at its recent high, 84c just about everything bad is already priced in.


I agree, think however that the highlighted event is quite likely. Why? US will run into a beautiful and stunning second wave (though admittedly, they are not yet through the first) with catastrophic economic impact. When? Bit harder to predict ... but I guess it will be at some stage between end of July and (Northern hemisphere) winter onset.

Sure - this should not really impact on OCA's fundamentals - but the same was true during OCA's first SP dip. Markets just moving in absolute harmony :) if everything crashes the good companies will come down as well. This will be the time to buy some more OCA;

[winner69]

My first mortgage in the mid 1990s was at over 20%!!!

in the 70's I had one at 28.5%

[nevchev]

I agree, think however that the highlighted event is quite likely. Why? US will run into a beautiful and stunning second wave (though admittedly, they are not yet through the first) with catastrophic economic impact. When? Bit harder to predict ... but I guess it will be at some stage between end of July and (Northern hemisphere) winter onset.

Sure - this should not really impact on OCA's fundamentals - but the same was true during OCA's first SP dip. Markets just moving in absolute harmony :) if everything crashes the good companies will come down as well. This will be the time to buy some more OCA :):
Not sure about that BP.OCAs first dip occurred because of the unknowns in play at the time.We have a better handle on the whole covid event now

[winner69]

is that oca‘s property valuation will going down like kiwi property in next report？

even they made heaps (operating wise) they took the 'difficult decision' not to pay a divie ...hmm

[Beagle]

is that oca‘s property valuation will going down like kiwi property in next report？

I suggest you listen to the recording of the Macquarie presentation I posted a link for recently. They address that question.

[Maverick]

Not sure about that BP.OCAs first dip occurred because of the unknowns in play at the time.We have a better handle on the whole covid event now
yeah , I'm with you Nev,
i think the global risk is not great of a second crash. Historically, pandemics don't upset the financial apple cart much at all , certainly not for long.
During this event money hasn't been destroyed, in fact more has been created. While some of it has changed hands (winners and losers) it still exists and has to be parked somewhere.
OCA will come out of this a covid winner twice,
1. It's customer demand will be at least as strong post covid.
2. It's property based , and where will this money gravitate to eventually?

Waining for a second crash , IMO, is riskier than missing out.

[Cyclical]

Wouldnt be silly to take out a small mortgage at fixed rate of 2.something% for 5 years and buying OCA which at 6% would still offer a return of over 3%.Not to mention the capital gain!!!


Nevchev, If I was a younger chap I would do exactly that. BNZ have just today lowered their 5 year fixed rate to 2.99%. That's a remarkable fixed rate for 5 years and something I never thought I would ever see.

If I could convince the wife, I'd certainly be tempted. Think of it as a bargain basement rental property, leverage it accordingly, sit back and enjoy the returns without the inherent hassle. Unfortunately she considers share market investment as gambling. Still, if things continue at this rate with my OCA holding, I might be "well positioned" to convince her otherwise.

[Cyclical]

During this event money hasn't been destroyed, in fact more has been created. While some of it has changed hands (winners and losers) it still exists and has to be parked somewhere.
OCA will come out of this a covid winner twice,
1. It's customer demand will be at least as strong post covid.
2. It's property based , and where will this money gravitate to eventually?

Waining for a second crash , IMO, is riskier than missing out.

Yep, yep and yep. Couple that sentiment with the 6% yield at today's price vs jack squat in the bank and you've got a winner.

[winner69]

Talk if a retail bond offer....was that so they could afford to pay a decent divie in August

Since starting divies they've forked out $42m in divies (even though non-property cash flows have been negative $30m)

And in same period debt is up $114m

Sometimes I think to myself I just dont get the economics of these type of companies.

[Cyclical]

Talk if a retail bond offer....was that so they could afford to pay a decent divie in August

Since starting divies they've forked out $42m in divies (even though non-property cash flows have been negative $30m)

And in same period debt is up $114m

Sometimes I think to myself I just dont get the economics of these type of companies.

It's a bit Peter to pay Paul / ponzi isn't it? But while the dollars keep getting watered down, all is well and good :)

[Beagle]

Winner mate, you love playing Devil's advocate...sometimes I think you thrive on it. They're in the middle of a major transformation process as clearly articulated in the Macquarie presentation. Its not that hard to understand. Listen to the presentation.

The link to listen to this presentation is in here. http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/OCA/353551/323074.pdf

If you are serious about understanding OCA there is no excuse for not making the time to view this.

[nevchev]

If Salts average sell down price was 75c,had they have held on and trickle fed and averaged at say 82c.......
12000000×0.07=$840,000.
Must be nice to play with someone elses money

[winner69]

If Salts average sell down price was 75c,had they have held on and trickle fed and averaged at say 82c.......
12000000×0.07=$840,000.
Must be nice to play with someone elses money

It's possible Salt are still selling / reducing

Get the price up and then have another go.

[Cyclical]

If Salts average sell down price was 75c,had they have held on and trickle fed and averaged at say 82c.......
12000000×0.07=$840,000.
Must be nice to play with someone elses money

When you are talking their kind of scale, that was trickle feeding unfortunately. And that seems to be the only reason OCA went down from mid 80s last time. They have enough left to do the same again, 2.5 times... The question is, do we consider that prospect scary, or further opportunity to accumulate. I'm in the latter camp, but at the same time too scared to profit take at this point in time for fear of regret!

[nevchev]

When you are talking their kind of scale, that was trickle feeding unfortunately. And that seems to be the only reason OCA went down from mid 80s last time. They have enough left to do the same again, 2.5 times... The question is, do we consider that prospect scary, or further opportunity to accumulate. I'm in the latter camp, but at the same time too scared to profit take at this point in time for fear of regret!
Yer,me to.Hard to find anything else on the NZX with these sort of prospects. Waiting to hear back from my loans officer.Its only money😁

[winner69]

Broker targets appear to be 108 and 122 (Marketscreener)

Big upside from here

Go OCA

[Beagle]

Average target price is $1.16 https://www.marketscreener.com/OCEANIA-HEALTHCARE-LIMITE-103506268/consensus/

[winner69]

Average target price is $1.16 https://www.marketscreener.com/OCEANIA-HEALTHCARE-LIMITE-103506268/consensus/

Prefer the 122 target though

Must be Forbar

[Joshuatree]

Broker targets appear to be 108 and 122 (Marketscreener)

Big upside from here

Go OCA

Go you good thing GO GO GO!;).

pulls out whip and hits a wnner

[nevchev]

Go you good thing GO GO GO!;).

pulls out whip and hits a wnner

Hahahahahahahahahaha.