Just assumed the SP would be a lot higher if they were doing said plowing.
Understand your point re weightings etc
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Thanks for those broker updates guys. Reinforces my view that the announcement was very encouraging.
Just a couple of other thoughts. That's a lot of earnings accretion with spending just $57m. I'm really looking forward to seeing what the team come up with in terms of other acquisitions with the $290m in the years ahead. My goodness, with $290m they could do five more acquisitions of the same size (2 villages), that's potentially ten new villages all earnings accretive. Wow ! Interesting times !
In addition I would think the present environment (falling real estate market and very tight labour supply situation), will present some real bargains to be had. With Brent's background I think we can trust his ability to crunch the numbers accurately so all future acquisitions will also be strongly eps accretive.
I'm doing my best not to get too excited about this given all the headwinds I've alluded too previously but I really do think the headroom they have with their new bank facility and the prospect of up to another 10 villages and the direction the company are headed with more emphasis on independent living units is very encouraging for the medium to long term.
It'll be interesting to see the new NAV when they announce their result on 20 May. While some discount to current NAV is warranted by the issues I've alluded to with their legacy basic care model if the fair value NAV is close to $1.50, given the new growth by acquisition approach I can't help but feel the size of that discount pricing this at under $1 is factoring in too much pessimism.
Pending any untoward surprises in the upcoming result I'm inclined to think its now a case of accumulate for long term slow and steady growth on any untoward price weakness under $1. Provided one takes a multi year forward view this should do okay now, provided you buy it cheap.
I've recently handed back a care suite from a parent no longer on the planet for recycling and the heavy duty stiffing (agreed and accepted within contract terms) incurred for a shorter than planned stay should be a positive for the books.
More reasons for a hound to smile 😉
PS fair to say the environment there was the best around and the services received absolutely first rate. No complaints there.
I'm sorry for your loss mate. Its tough. I lost my Mum in April last year and I still really miss her heaps.
Thanks B, appreciate that.. Pity I couldn't have kept the suite for my dotage but we've both got a while to go my friend 😉
This is what I have been talking about regarding the snowball effect. My forecast for FY22 is ~$49m for DMF, which is +30% versus an annualised FY21 value.
OCA DMF Revenues $m 10 mths 12 mths 2014 2015 2016 2017 2018 2019 2020 2021 2021 Adj. 2022 F'cast CAGR CAGR
5 yrsCare $0.9 $1.5 $2.3 $3.0 $3.6 $5.1 $7.8 $9.5 $11.4 $14.5 Village $8.2 $10.0 $12.1 $13.3 $15.0 $17.9 $21.4 $22.1 $26.5 $34.9 Total $9.1 $11.5 $14.4 $16.3 $18.6 $23.0 $29.2 $31.6 $37.9 $49.4 23.5% 24.8% Adjust -$3.7 Reported $9.1 $11.5 $10.7 $16.3 $18.6 $23.0 $29.2 $31.6
Attachment 13790
Heck...they might even do 8.5-9 cps or maybe even a bit more ? in underlying eps in FY23 (current year PE about 11) and with the snowball steadily building momentum in the years ahead plus more strongly eps accretive acquisitions more growth appears quite plausible after that. Seems a bit cheap under $1 even with legacy care and staff inflation issues. Hope there's no nasty surprises when they report on the 20th because I am leaning towards talking myself into buying some more.
"talking myself into buying some more"
what are the expense variances for those years.. If DMF increases outpace increases in expenses by a large margin well and good.... else ...not so good.
Sorry, what does DMF stand for ?
Thanks