I am going to the AGM on TUE 31 July and are wondering if their are any Share Traders interested in a catchup before or after the meeting. Would be nice to meet some more people who are posting here.
Cheers Forest
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I am going to the AGM on TUE 31 July and are wondering if their are any Share Traders interested in a catchup before or after the meeting. Would be nice to meet some more people who are posting here.
Cheers Forest
My understanding is that rym is required to pay within 6 months of vacancy 'by law'.
Presumably a delay can be considered a negotiated loan, so with interest being paid (hopefully at commercial rates), there's no problem.
Had trouble explaining to my venerable and ancient parents that probate can take 6 months anyway...
From today's AGM:
Trading in first quarter ahead of last year.
Plans to build their 28th village on site of former Petone High School.
What did they mention about the land they have purchased in Australia at the AGM?
Any facts or figures regarding how fast or big they intend to build in the short and longer term?
Hi Sparky,Quote:
They noted that margins won't be as good as they are here in New Zealand, at least not for the short term, and that they don't have the reputation in Australia they enjoy here.
Us Ryman shareholders might end up owning a Summerset type appendage after all ;)
Cheers
Sauce
Ryman been accelerating uptrend , could be topping out for a while? Have to wait and see, but if the gap closes i will be taking profits on the first blue bar that occurs
Attachment 4117
This seems like an excellent operation but Im always cautious when they start to expand overseas.
Many good operations have come unstuck by doing this to quickly.Might wait and see how this unfolds.
Thats what i like about management they are NOT rushing in, initially building one, NOT buying out other peoples mistakes ; being careful ,despite doing their homework.
Should they get it completely wrong,they will have to right off say approx $30mil.
Should they get it half pie wrong and sell they may loose $10mil.
Either case it is not a lot loose.
However should they get it right,the sky is the limit.
I understand most Aussie villages are more "life style" rather than total care.
If they had n't tried Aussie the market,then I think we would be right to say they should have.
So with little to loose,a lot to gain I think it well worth "going for'.
Hi Percy,
I like to think I am conservative in valuation, but from what I can ascertain, RYM's share price is now building in some success in Australia.
Based on a DCF methodology with roughly 15% growth in underlying profits for the next 5 years (they will probably beat this hurdle this year) and growth declining to zero and ROE declining to the cost of capital in a straight line over the subsequent 5 years, and a terminal cap rate of 8.5% (which sounds about right for a net return from a mature but high quality property play) I get around $3.80 per share.
If RYM can continue their growth period for a lot longer than this, then they are worth considerably more on a NPV basis.
I think it is prudent to assume they will need success in Australia to add impetus to keep the growth rate in double digits past 5 years.
It is a real shame the market has woken up to the extreme undervaluation that existed a couple of years ago. As a net saver for a couple of decades yet, I would like to put more money to work in RYM. But I won't pay the current price.
No way would I sell my holding however, as this is a rare growth story and the potential for a continuing secular growth period, in NZ and AUS is high. AUS could be a game changer over time. Just no margin of safety; buyers now are to starting to pay for perfection which is risky. And in my view some success in AUS is starting to be priced in.
Cheers
Sauce
There is something else is note worthy; RYM is undergoing a strategic change of direction that I believe will further enhance and solidify RYMs competitive position over time.
Don't have time to go into the numbers, but the summary is that RYMs care/dementia units are now being built at a scale which are profitable; in the past the care element provided immense intangible value, but on their own were loss making or break even. Indeed this is still the case for Summerset.
RYM have been building larger and larger villages and with the scale they enjoy, they can, and are, switching the mix of units more towards care beds and can do this profitably now. The reason that this is significant is that it positions them very well for the wave of demand that is coming in the full time care space as more baby boomers crap out totally before wanting to move to a village for lifestyle reasons.
I would be highly suprised if they do not enjoy considerable pricing power in this space as demand grows, which could provide a lot of future profit growth from the villages being built now without any additional capital.
They are so far ahead of the competition (besides MET and Summerset, its all tiny fragmented players with no scale and little profitability) in this regard, that no one will be able to offer the same level of care/service or have the same capacity. And, importantly for shareholders, no one else will have the same profitability per bed.
Perhaps Summerset will get there one day, but I personally doubt they will ever be as profitable by a measure of return on shareholders funds. RYM are able to steer the ship in this strategic direction nice and early, and I think it will lead to even more dominance in the future.
With regards,
Sauce
Sauce,
Thank you for your update and research.