Tegel IPO

[winner69]

As mentioned yesterday distribution costs up by millions compared to the pcp. Worth noting that the current diesel price is quite dramatically higher than what was prevailing on average throughout the pcp last year and higher than the most recent half year too. I think there's plenty of potential for the full year profit to be yet another disappointment and be less than FY17.

Food for thought for holders while eating their chicken club sandwich for lunch. EPS last year was 9.52 cps. I think its clear now you've been sold a pup and all that talk of growth is nothing but that, "talk".

Even if current period distribution expenses don't jump millions more compared to pcp where's the growth ? Legendary investor Benjamin Graham reckoned a fair PE for a no growth company is 8.5. On that basis 8.5 x 9.52 gives fair value for Tegal of just 81 cents.

On that basis the dividend yield would be roughly the same as that other recent float that talked a lot about growth and has also delivered none, MPG.
By my reckoning both companies deserve to trade around 80 cps, maybe 90 cps if we're being kind and attributing a PE of 9.5 due to the current very low interest rates.

C’mon beagle you know Ben’s formula was relevant decades ago but not that relevant today.

And surely a ‘solid’ profit making company investing to stay in the game (investing to survive is how some describe it) will achieve some modest growth into the future. That growth probably coming from punters eating more chicken if nothing else.

A DDM calc using say 2% and 3% growth gives a value of 94 cents and $1.07 respectively

That’s how I see it

[Beagle]

Yes, No, Maybe. 2% growth in top line sales in line with inflation..so no real inflation adjusted growth. Yes the prevailing risk free interest rate in Ben Grahame's day was 4%, a bit lower now so maybe we stretch to a no real growth PE of 10 which on 9.5 cps means fair value is 95 cps, see we're not that far apart
Is it really that 'solid'...just keeps disappointing the market time after time...
P.S. Even though Tegal rhymes with Beagle this hound is not having a bar of investing in it...happy for Mrs Beagle to invest in it at the supermarket though !

[moka]

So paltry growth really although the dividend isn’t chicken feed or paltry.

Poultry volume growth
48.7k tonnes
UP 1% YEAR ON YEAR

[winner69]

Earnings out on Wednesday, May - October prices have been less volatile this time round...

Now all they had to do is more or less hold onto market share.

Remain cautious with this one though, I remain open to the idea a 5% volume lift is on the table.

	1H17	$ CHICKEN		TGH SP
31/05/16			$15.18	$1.65
30/06/16			$14.35	$1.65
31/07/16			$14.44	$1.67
31/08/16			$14.41	$1.71
30/09/16			$13.52	$1.64
31/10/16			$13.42	$1.54

	1H18	$ CHICKEN		TGH SP
31/05/17			$14.16	$1.10
30/06/17			$14.35	$1.15
31/07/17			$14.81	$1.24
31/08/17			$14.21	$1.25
30/09/17			$14.67	$1.27
31/10/17			$13.74	$1.38

Attachment 9300

Latest Food Price Index has chicken down to $13.00

Lowest price for a long time

No wonder you bailed from Tegel

[Balance]

Latest Food Price Index has chicken down to $13.00

Lowest price for a long time

No wonder you bailed from Tegel

No signs at the supermarket or Mad Butcher or the various individual meat shops that chicken prices are stabilizing - in fact, the discounting has gotten more aggressive with mad Butcher offering drumsticks at $2.99 kg and boneless breast meat at $7.99 Kg!

[hardt]

Latest Food Price Index has chicken down to $13.00

Lowest price for a long time

No wonder you bailed from Tegel

The theme which kept me long Tegel was the recovery in prices - not looking all that likely anymore.

Was not expecting exports to let them down this badly, really would have been a solid half if on par with domestic.
+20% back to where the market valued the forecast being hit - all they have to do now is progress in Aussie as they said they would do

Not cheap enough to get me back in... plenty of other opportunities

[janner]

Not cheap enough to get me back in... plenty of other opportunities

Exactly.. NZ chicken has nothing going for it in the export field ... Nothing...

A company that was oversold from the beginning.. Cleverly enough to suck so many " Experienced " investors in ..

Good only for possible dividends.. Which are not guaranteed ..

Disc. Never a holder.. Probably never will be .. Quote " Plenty of other opportunities ""

[flyer]

A small rise in the last 2-3 trading days, is chicken on the comeback?

[JoeGrogan]

perhaps some people wanting a nice holiday dividend to recoup those xmas expenses

[flyer]

Shortage of chicken in the USA, KFC has had to close stores because they cant get any. Maybe a flow on effect may follow, pity Tegel cant supply to them.