The markets never go up in one direction for 4 years..but maybe AUS and NZ will disconnect to some degree in certain defensive sectors.
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The markets never go up in one direction for 4 years..but maybe AUS and NZ will disconnect to some degree in certain defensive sectors.
Well it may take time for the international investors to notice that NZ is different. On returning to NZ it became clear that NZ has taken a new direction under Keys as NZ missed the bigger impacts of the GFC due to increasing population and capital inflows.
NZ tends to be over looked and dumped when money moves around the global markets.
HLG is a stock that can unfortunately get hit about a bit.
But perhaps there expansion into AUS can stop this trend depicted in the charts.
With Russia's vaccine 92% effective the world is going to change in the next 6 months and stocks such as travel will start to return. The other vaccines will change the world in the next 12 months we all know this.
Its not that HLG isnt worth good money its just where the money goes and NZX inclusion is vital to stop the chart bouncing up and down.
While we love the bouncing around its not actually good for the vast majority of investors.
Maybe in different times, different conditions - Waltzing .. not sure my crystal ball suggests going forward ST this time
Too many other factors present .. ;)
Excess money supply out there / relative unreported inflation / yield driven market / finite scrip,
just past one of the better (post Covid) retail recoveries period etc etc
but them I may be wrong too ;)
If HB doesnt perform probability a short term hit of a 50 cents only this time.
We are not expecting a hit to SP.
unless the ghost of LTCM hits markets.
HRO all over again...
biggest short SQ in 25 years.
biggest unwind since 2009.
I'm still forecasting 50 cps fully imputed per annum in dividends = 69.44 cps gross = 9.7% yield on yesterday's closing price of $7.19
I think they can easily do 60 cps in earnings this year so are on a forward PE of just 12 and I think there is very strong evidence that they have excellent growth prospects in Australia with Glassons. The risk to my forecasts is to the upside.
They had 83 cps in cash at balance date, (and no obvious need to deploy it) so backing that out they are on a FY21 forecast PE net of cash of just 10.6 !
I think a takeover of IFT is more likely than not and if HLG doesn't get into the NZX50 that way its likely too under its own steam in the near future.
Peer comparative notes.
Briscoes closed yesterday at 19.4 times last years covid affected earnings.
WHS was at 24.2 times last years earnings.
The average is 21.8 times last years affected earnings. I think HLG has significantly better growth prospects than either of these two peers, (neither of which have their brand growing strongly in Australia) but if we just stick with the average 21.8 times, HLG's 2020 Covid affected earnings of 46.56 cps = Fair Value on a comparative basis = $10.15
They have a very strong balance sheet, no debt, excellent stock turn, the highest percentage of online sales of their peer group, new distribution center's in Aust and N.Z., no immediate need for further capex and are taking a very cautious approach towards store openings in the current environment so their warcheast of ~ $50m will likely continue to grow.
There is presently no analyst coverage, (this might change soon with NZX50 inclusion) and they are literally knocking on the door of NZX50 inclusion.
A trading update is due sometime in February, possibly quite soon, and I am expecting $24m for the first half up 50% on the prior comparative period.
Disc - I bought more last week and a further modest top up this morning making HLG my largest investment position.
hmm...pushing toward $7.30 this morning?
Excellent summation!
I'm wondering with the large cash balance if they are considering expanding/acquiring with another brand with a different market with which they could leverage there existing fulfilment infrastructure. Could just be an online effort initially as well. Maybe something in footwear (think Allbirds) or a clothing subscription offering.
Jeez Beagle, forecasting eps 60 cents not the usual bullish beagle
EPS 60 cents is $36m npat
If they do $24m in H121 then the last year (H220 + H121) is $36.3m - even with all covid issues. So $36m for full year would be seeing earnings decline in H2.
Surely we should add a bit of growth in --- maybe $40m full year, ie eps 67 cents
And 67 times 21.8 is $14.60
That's half todays price - spooky eh
You're quite right mate. I am being super conservative with 60 cps, (far too conservative...which is unlike me). In my defense I have only had time for one coffee this morning and I did say "I think they can easily do 60 cps in earnings this year"
To be honest I haven't really given a lot of thought to the second half but I think ultra low interest rates and people's inability to travel will see retail demand remain at a very robust level. Maybe we see as much as $20m for the second half which would lead to around $44m for the year and eps of 74 cents ? I guess that raises the possibility of what on earth are they going to do with all that cash ?
LOL that would be very nice but 21.8 is the average of the other two retailers on last years covid affected earnings. I don't think we can expect it to trade at that multiple on this years earnings but at $10 its fairly priced compared to its peers and as mentioned, I think HLG has much better growth prospects going forward.
economy exploding on forward govt spending...
$13
if aussi numbers are the same for employment.
Come on boys you starting to sound like the Three Stooges with this guessing game .....
Yes...I was pondering what is the right multiple for FY21 and I arrived at almost the same conclusion. I am thinking 15-16 times current year earnings based on their multi year track record of strong growth in Australia with Glassons. I think the shares are worth $10.15 now and my price target for 12 months hence is $11.50.
The yield could be VERY interesting. Unless they have plans for the substantial ~ $50m cash on hand I expect they could pay out close to the whole years earnings this year.
Canny investors will know this trades cum a likely twenty something cent fully imputed dividend likely payable in April...or maybe its 30 cents ?
NZD up on surprisingly low unemployment rate
So less people unemployed / more working - that’s good for HGH
And NZD good for HGH margins later in year.
NZX inclusion with no increase in share capital and if interest rates stay low for 3-4 years it explodes to 13 before falling back on lack of shares for sale.
stocks often over shoot if there is limited supply.
people with saving and deposits will be desperate and inclusion of NZX will force the share price to over shoot valuations.
The effect of low interest rate and TD is yet to take full effect. Panic will set in at some stage to buy the stock if profits increase.
Demand of travel is already backing up.
Every street here is starting to look very spiffy.
Notice that it can make jumps of over 2 dollars in short time frames before falling back on good news.
its not W(N)
its W(D)
digital Winner
Quite probably not other than to avoid confusion on here. I think both HLG and HGH are excellent buying and expect both to have very positive announcements later this month.Quote:
Winner69;870207]Right - it's just that Hallensteins Glassons use HGH (Hallensteins Glassons Holdings) in some documents I was reading. I am getting brainwashed :cool:
Obviously need to be more careful
You buy into unprecedented high, just know what you’re buying into, a cyclical, which might have satisfying upside but when it stops you have to also know when to get out, just saying
Caveat emptor
If the PE ratio is low compared to other retailers its not that expensive.
well is it cyclical this time... no because govnt has brought the good times forward in a time warp....
the only reason this thing drops a wing is it not in the NZX nifty fifty..
Liquidity..
Another one bites the dust in Wellington with David Jones going to close - amazing its still there though
Farmers store across the road but by far the glitziest big store left on the Golden Mile (another anachronistic thing) is the combined Hallensteins Glassons flag ship store just up the road
Maybe retail in downtown Wellington (and other cities) is dying or already dead - if so this store might be one of the worst performing of their stores. At least they sold the building and after spending zillions on the outfit hopefully not stuck with a long term expensive lease.
.......................Attachment 12284
I think a share split is a very good idea and would definitely enhance liquidity. I'll send an email to the board and outline why I think that's a good idea.
Got thinking overnight about what the real PE is adjusted for the ~ $50m cash mountain they have (which is 83 cps). $7.33 - 0.83 = $6.50 one is paying for future earnings and if they make 74 cps this year that's an adjusted FY21 PE of just 8.8 which is absolutely nuts for a company with a multi year track record of strong growth in Australia.
On the TA side of thing, while I'm no expert by any means, but to me, the chart looks very encouraging ! RSI is only 50 so its certainly not overbought ! Chart above is now and the one below one is when it was a sell just as Covid hit. Very different charts. The trend is your friend.
On Balance
" hard to fathom how SKT can still stay in NZX50."
yes!
and i suggested a share split a while ago ... best idea for this best dressed ..
A 2 for 1 would make share price around 360
Waltzing man would say I told you so - shareprice cycles between $3 and $7 so his sophisticated IT system would signal a BUY ...and share price would cycle back up to $7 :t_up::):confused::ohmy::scared::(
Only reason I can see for a stock split.
If you believe a stock split would be beneficial to shareholders and give enhanced liquidity and improve the chances of NZX50 inclusion please support my representations to the board along those lines by contacting them here. https://www.hallensteinglasson.co.nz/contact
"so his sophisticated IT system would signal a BUY"
DISC: the Binary Platform Components are not a BUY and SELL signal system. One of our soft bits and pieces is Back Office.
if you need buys and sell anyone can dump to the 365 versions of OFFICE and use its new data types to do your stats.
Notice that EXCEL now supports a lot of new work to speed its engine up and formulas as LAMBDA. You need the insider version though.
Deleted ..waste of time
Lambton Quay shopping district have suffered immensely from the work from home boom - tens of thousands of government and corporate workers in wellington CBD are no longer going into the office 5 days a week (the new normal is somewhere around 1-3 days a week in the office for many) - so shops & cafes/bars in the Lambton Quay area are suffering from the big drop in foot traffic. The area has the highest average salary workers in New Zealand, but they only shop here when they are in the office - they go to the suburban malls etc generally when working from home & weekends (as there is bugger all parking in that area of CBD, and its really expensive). David Jones was targeting the high end customer so not surprised it is closing (good strategy for Lambton Quay pre-pandemic, not so much now). Notably the other side of the central city, Courtney place/manners street/cuba street retail area is still doing very well as that was not reliant on the Lambton Quay market (HLG has both a new Glassons store and a Hallensteins on Cuba Mall.)
Idle thought: they should turn the David Jones location into an entertainment complex (cinemas etc), would bring more people into the area on weekends (which have always been particularly quiet shopping wise down that end of town)
As I’ve said before I think Hallensteins Board don’t even think about the share price and furthermore they give the impression retail share holders are a pain in the butt but a necessary evil that’s part of being a listed company.
Patently clear from the brevity of their updates and the lack of enthusiasm shown at AGMs
But you never know they might listen to you if many of you clamour for a share split.
Have to agree they're a pretty conservative lot...kind of old fashioned...but I like that. Listed in 1947, N.Z.'s oldest listed company.
I like companies that have been around longer than I have.
Agree its unlikely they will split but you never know...if enough people ask for it they might listen.
Thanks for your support LaserEyeKiwi.
For what its worth I suggested a 5:1 stock split.
As the E in P/E represents "earnings", shouldn't we adjust by the amount of interest (earnings) from the $50m cash mountain, not the $50m itself?Quote:
Got thinking overnight about what the real PE is adjusted for the ~ $50m cash mountain they have (which is 83 cps). $7.33 - 0.83 = $6.50 one is paying for future earnings and if they make 74 cps this year that's an adjusted FY21 PE of just 8.8 which is absolutely nuts for a company with a multi year track record of strong growth in Australia.
:cool:
Way to go is to bring it up with long time major shareholders while sipping wine on his yacht while cruising Marlborough Sounds
ST once had such an influencer
HLG will have some marginal stores in 2nd tier cities perhaps.
DISC: we have some soft ware in europe but that toy is for developers.
What earnings from interest on deposit ? Basically nothing these days. To my way of thinking with HLG you are buying a cash mountain, (the size of which is unprecedented) and future earnings. Eventually they have to do something with all that cash (although as a conservative company I expect them to continue to run a high cash balance until we're completely out of the woods with Covid). That said if they're earning 74 cents per share, (hardly expending anything on capex so cash flow before depreciation is much more than 74 cps) and they already have a very high cash balance so I think my estimate of 50 cps fully imputed for FY21 is looking excessively conservative.
For what its worth this is the brief message I sent to the board
Quote:
Dear Directors, You will probably be aware there has been some commentary from Forsyth Barr that our company is knocking on the door of NZX50 inclusion and is ostensibly the next cab off the rank if one of the existing constituents falls out. One of the criteria for inclusion is based around the liquidity of the shares and I feel with the share price over $7 a share split would be most helpful in boosting liquidity. Perhaps a 5:1 like Pushpay recently did ? Kind regards ....
Compare to size of capital allocated HLG has over the decade generated profit for us almost more than any other share here in NZ or even on overseas exchange.
No other stock has given us 3 slices at the cake in such short time frames.
The capital allocated should always be calculated in hours invested on the market and that where buy good luck it out performed.
sorry no fun comments in this one. No license taken with words like Double Bubble or anything fun...
spread for any real parcel is very high
you'd have to pay $8 to get only 15k shares.
That, of course, was my point!Quote:
What earnings from interest on deposit ? Basically nothing these days
;)
"That, of course, was my point!"
we all figured that out back in april last year....old news
It seems I'll have to spell it out for Waltzing.......
I was suggesting that it was the earnings (minimal) on the $50m war chest that should be used to adjust the E in HLG's P/E, not the "capital" $50m sum itself.
Was that correct, or not?
Perhaps we should move on. I'm really not any fan of these cash adjusted PE's anyway. My point is simply that one is buying not just a high current and future earnings stream but a company with a LOT of cash on hand (83 cps at last balance date) and no debt. I think from a financial point of view that puts them in a very robust position going forward.
I see WHS has announced a special dividend this morning. Perhaps that's an idea for some of HLG's cash mountain or maybe we just "make do" with them paying out all earnings this year.
74 cps fully imputed = ~ $1.03 per share gross inclusive of imputation credits and on the current share price that's ~ 14% gross yield...WOW !!
Unfortunately (as much as I agree with them not paying the subsidy back) I think they will suffer a PR backlash from a special divy. I dont think that would be wise. WHS are clearly able to do it without worrying about that now.
Id love to have cake and eat it too.
Ps welcome back mate!
"74 cps fully imputed = ~ $1.03 per share gross inclusive of imputation credits and on the current share price that's ~ 14% gross yield...WOW !!"
exactly...
over and out ...... hang on.....
Bulls eye yet again.. MR B takes home the bag and the money....
forget the WS as it should have been an IRD and Accounting standard for public companies and is the fault of the implementation.
P/E is only an historical function of capital structures in only as much as capital is used to invest in revenue generating operations and is a derivative of Accounting Body Standards and statue IRD interpretation. Once again MR B hits the bulls eye.
He puts it up publicly on NZX announcements
Probably got 2 phones anyway ...one for his business things that probably somebody else answers anyway ....and the secret one where important stuff goes.
Mary Devine puts her number on some announcements as well
Like an invitation give me a buzz if you want to discuss anything
Mission not accepted. Not necessary either as I know you old crusty's have the skills to ride the roller coaster and be gone when the time comes, without waiting for me or anyone else to tell you.
Chart (monthly) is pretty impressive, nice breakout to new ATH's, well above 50/200 EMA's, chasing up the BB's, on falling monthly volume, wide spread MACD, topping RSI, topping/topped Stoch.
Enjoy the ride.
Hi mate. I have upmost respect for your TA skills but I think your long term initial chart line reference point misses the mark.
I started investing in HLG at ~ $2.75 and was always and only ever in it for the huge dividends. Please go back and have a look at my posts in August 2016 and you'll see my dividend income motivation clearly displayed.
If your initial chart line started in 2016 you'd have a very different looking trend line. The thing is mate, growth in Glassons Australia since FY17 has been deeply impressive and in my view at least this has transformed them from a pure cyclical into a growth company. Not only has Glassons Australia growth been very impressive, (ably lead by Tim Glassons son) but their market penetration there is still only one fifth of their penetration with Glassons in N.Z. so they have huge potential there unlike their peers (WHS and BGR) who aren't even in Australia !
The growth in Glassons Aust is the key bit of information you're not correctly representing in your chart. I humbly suggest you recalibrate the starting point of your trend line to the beginning of 2016. If it was then possible to adjust for the fabulous dividends they pay twice yearly you would see that they have been in an overall uptrending channel (apart from Covid) since mid 2016.
HLG is one of my most rewarding investments of all time, (especially taking into account the huge fully imputed dividends), and despite the recent modest share price gain I am extremely confident going forward so its my #1 investment position on the NZX so believe me I am putting my money where my barking is !
Wake me up when we get to $10, it won't be very long ;)
Yo Beagle, I just slapped up all the data I have. Still a lovely chart and congrats to you and others for seeing the value and getting in at a good price. 2020 Covid prices was in hindsight a terrific gift for such a quality asset. My small holding is nicely green too. I forgot to mention I'm an old crusty as well, so see you at the exit when the time comes, there's no way I'm leaving these lovely capital gains on the table. Nice divvy as you say, while we wait. It's not a forever share for me.
All the best.
We will see Winner. Huge house price gains spiced up with ultra low interest rates and much higher than expected employment level's is putting plenty of spice and vigor into retail spending especially coupled with people's inability to travel internationally. I think these tailwinds will be more enduring than many others expect and all the while Glassons is building more and more brand recognition and critical mass in Australia.
I get a lot of comfort from management's clear expertise in handling challenging conditions, (Tim Glassons 20% stake, the owners eye as Percy refers too it), and this being the oldest listed company on the NZX. I sleep very well at night with plenty of these puppies in the kennel.
whoa. Nice slingshot today.
nobody mentioned $7.68 must be a new ATH
WHS divie announcement sets expectation of big HLG divie and punters are wishing for at least 30 cents in March (?) so getting in before it's just too expensive
Opposite to greater liquidity is today where supply is short - those who really want need to pay top dollar.
C'mon guys - keep buying no matter the price
Update any time now - you'll be paying more than 8 bucks then
small volume but up >5% today - wow
I dont believe it's expensive until it sails past a peg or two past the 11 or mid day
then it becomes cheap for those on the other side of the door wanting in .. ;)
Now for expensive - IMO FRE looks expensive .. and no Div .. ;)
Is MFT cheap or expensive suddenly for those deciding it's a must have ? ;)
Good sign - no-one wants to sell ;)
If HLG did a Share split in same circumstances - will anyone want to sell then either ? ;)
Just a matter of time & those in on board could have very much wider smiles as pieces
of HLG's 60 mil Cap on the loose become as scarce as hens teeth .. ;)
Are they ? Interesting study https://finance.zacks.com/stock-pric...plit-1189.html
For the time poor amongst us - "Although stock splits have no affect on the intrinsic value of the stock, being basically cosmetic, many studies show that stock splits result in high performance. In two separate studies in1996 and in 2003, David Ikenberry, Chairman of the Finance Department at the University of Illinois at Urbana-Champaign, found price performance of split stocks outperformed the market by 8 percent during the year following the split and by 12 percent over the ensuing three years. He looked at over 1,000 stocks for each study, including 2-for-1, 3-for-1 and 4-for-1 stock splits".
I took the liberty of asking for a link to this study to be sent to our Chairman...if you don't ask, you don't get ;)
The way price in moving you'll be forgiven to think its HLG that declared special divvy not WHS :p
I think the jury are reserving their decision on a Share Split .. ;)
No Split hasn't harmed MFT
Look what a 4:1 Split did for PPH -- has it recovered yet to $9.25 pre Split ? ;)
IMO - I'd far rather see everyone start considering the untold extra intrinsic value that
may lay in HLG and start preparing to shed nearer 20 a piece for a slice of the action .. ;)
Not quite sure whether this is true.
Currently 23.27% of all HGL shares are hold by insiders - and they are basically not on market (which is relevant for the NZX50 inclusion).
No matter, how often you split the shares - there will be absolutely no change in liquidity, unless the insiders decide to sell some of their shares.
Unless they (or better he - most of them are hold by Tim Glasson) do, there still will be 23.27% of all shares in insider hands. It does not matter at all, whether these are 13.9 m "full" shares or 27.8 m "half" shares or 69.4 m "fith-"shares.
Liquidity only improves if more of these insider shares are available on market. If that's what Tim Glasson wants, he could sell today. Why should he after a share split?
Having said that - I remember times when HGL used to be part of the NZX50 index (might show my age), i.e. there is absolutely no need for them to split their shares to get back, they just need to have (relative to the others in the NZX50) a high enough market cap of their free floating shares.
Compelling evidence for the jury / (Board ;) ), to consider with very large sample sizes for each studyWe need the extra liquidity for NZX50 inclusion.Quote:
price performance of split stocks outperformed the market by 8 percent during the year following the split and by 12 percent over the ensuing three years. He looked at over 1,000 stocks for each study, including 2-for-1, 3-for-1 and 4-for-1 stock splits".
If you want liquidity issues try DGL (delegats).
Hallensteins isn't too bad on that front.
But with HLG's tight Register with so many happy campers wanting to stay put - some of the SP formulations
forward eclipse that 12% in just one short rush - compounded forward with more of the same the 12%
over 3 years may be comparable to well say 75% 125% 250% - anyone want to pick a number after looking
at HLG's recent SP record ? ;)
I dont see further new holders buying in wanting to sell anytime fast either once news hits the wire .. ;)
Remember - there are vast extra bucks out there not going on holiday overseas, not liking the Bank's extortionary low
deposit rates, and a huge amount of new Retail Investor attention that materialised in past year & lots of bucks with them ...
Another large pile to float in off Bonus Bonds being liquidated in near future too
And still just the same number of slightly less that 60 mil HLG shares on issue ..
What does supply & demand dictate on where things may go ?
https://www.pdn.ac.lk/purse/Proceedi...11/it/it_7.pdf ExcerptQuote:
According to the analyses, 54% of companies recorded an increment of trading
volume after the stock split regardless of length of the data frame, and the trading volume
increased significantly in 60% of companies. From a total of 26 companies, 65% and 62%
of companies have increased their market price and number of trading respectively
7.75 .. 8.00 here we come
Anyone want to sell up or spit out a few from their stockpile to help out a slight liquidity problem,
or maybe all are even more eager happy campers for the time being ? ;)
Share split good idea or not (there are academic papers showing them good or ineffective) ....it all comes down to what the likes of guru advisors like Jarden recommend for NZ situation.(at a cost of course)