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Thread: Comvita - CVT

  1. #1031
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    Quote Originally Posted by winner69 View Post
    Still have about $100m in Inventory as at December - thats more than $2 tied up in stock

    That's enough stock to support a years sales

    sort of suggests that bees not being too busy this year shouldn't have been a real problem

    Just doesn't make sense .....should be plenty of stock

    Maybe those doing the due diligence are having difficulty finding this stockpile of honey to see if it exists
    Thanks again for your warning quite some time back that inventory with this company only goes in one direction and that's upwards !
    I wonder if the company will continue to roll out the old cliché that having this much inventory is fine because the UMF rating goes up over time ?
    I suspect there must be some serious issues with some of that inventory, could be why it's taking the interested party so long to complete their due diligence ?...wonder if Comvita have ever heard of the accounting convention when valuing stock, the lower of cost or net realisable value ? Seeing as they're allegedly a monopoly lol, maybe they think generally accepted accounting principle's don't apply to them ? Remind me again mate, what's HLG's stock turn, isn't it more than 4 times a year ?
    Ecclesiastes 11:2: “Divide your portion to seven, or even to eight, for you do not know what misfortune may occur on the earth.
    Ben Graham - In the short run the market is a voting machine but in the long run the market is a weighing machine

  2. #1032
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    Quote Originally Posted by Beagle View Post
    Snapiti e.mailed me today and he thinks that CVT produces approx. 15% of N.Z.'s manuka honey.
    That's a very strange sort of monopoly
    It's probably more like 25%, and it's the better quality stuff too.

    A2 Milk has a 9% share in Australia and a 4% share of infant formula in China. McDonald's market share of the USA burger market is 17%

    Obviously margin, distribution, and economies of scale come into play.

    What's the point here, like there's many other Comvita's out there or something? Where are they then, why aren't they on the NZX too? I bet if you opened the books on them they would all be terrible.

    Quote Originally Posted by Balance View Post
    Strange indeed! All the other players are apparently 'ants' so that can only mean that Comvita is just a bigger ant?
    The ant is the New Zealand investment community. Take any company here and list it on the ASX, what happens, it goes up 10x in value overnight. Take it over to China, with the right strategy, vision, and execution, and it will be 100x in value. Go figure.

    Quote Originally Posted by winner69 View Post
    Still have about $100m in Inventory as at December - thats more than $2 tied up in stock

    That's enough stock to support a years sales

    sort of suggests that bees not being too busy this year shouldn't have been a real problem

    Just doesn't make sense .....should be plenty of stock

    Maybe those doing the due diligence are having difficulty finding this stockpile of honey to see if it exists
    Bellamy's had stock issues too. Share price has recovered since. $100m of stock isn't even that much when you've got 1.4B mouths to feed.

    These stock issues are just teething problems. The Chinese have only just started using Ecommerce. People were filling suitcases up and selling it on back streets. Seriously, the distribution network is fragile and problems like this happen.

    That's why China Resources is buying it as they've got 4000 supermarkets in China and they know how to move the stock. The JV was just a sneaky way for them to get their foot in the door. I bet you they will clear that $100m in 3 months.

    Quote Originally Posted by Balance View Post
    Ties in with the heavy discounting of Comvita products now taking place - Comvita must be trying to get rid of old or low quality stock.
    Probably because NZ has no money. What are these discounts, like $60 down to $40 or something?

    Quote Originally Posted by Beagle View Post
    Thanks again for your warning quite some time back that inventory with this company only goes in one direction and that's upwards !
    I wonder if the company will continue to roll out the old cliché that having this much inventory is fine because the UMF rating goes up over time ?
    I suspect there must be some serious issues with some of that inventory, could be why it's taking the interested party so long to complete their due diligence ?...wonder if Comvita have ever heard of the accounting convention when valuing stock, the lower of cost or net realisable value ? Seeing as they're allegedly a monopoly lol, maybe they think generally accepted accounting principle's don't apply to them ? Remind me again mate, what's HLG's stock turn, isn't it more than 4 times a year ?
    HLG is crap. That deserves a PE of 10 max. The exciting stocks on the NZX are the ones exporting food to Asia.

    Quote from an article just released a few hours ago:

    http://www.scoop.co.nz/stories/BU180...a2-comvita.htm

    "We think New Zealand agribusinesses are in a good space, they make good products, and sell them to Asia," chief executive Andy Borland told BusinessDesk. "We have over the years developed our skills around exporting and dealing with Asia, particularly China, and we are looking at businesses within New Zealand that would work with those sort of dynamics and be complementary to our apple business. We are really looking for those sort of New Zealand opportunities.... Comvita, another beneficiary of Chinese demand for New Zealand products, rose 2.3 percent to $6.75."
    I didn't buy today, cause I thought it would go sub $6.50 with all the negativity here. Someone was loading up the truck though.

  3. #1033
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    Hi Ogg, even without my trusty stethoscope, I seem to detect a slight case of 'investor bias' in your recent posts.

    The cure is quite simple, and merely requires listening with an open mind.

    I wish you a speedy recovery.

  4. #1034
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    Quote Originally Posted by Beagle View Post
    Thanks again for your warning quite some time back that inventory with this company only goes in one direction and that's upwards !
    I wonder if the company will continue to roll out the old cliché that having this much inventory is fine because the UMF rating goes up over time ?
    I suspect there must be some serious issues with some of that inventory, could be why it's taking the interested party so long to complete their due diligence ?...wonder if Comvita have ever heard of the accounting convention when valuing stock, the lower of cost or net realisable value ? Seeing as they're allegedly a monopoly lol, maybe they think generally accepted accounting principle's don't apply to them ? Remind me again mate, what's HLG's stock turn, isn't it more than 4 times a year ?
    Now that everyone has clued up to MGO aging the effect of this is fully priced in to new supply. Likely alot of the old stock isnt able to get into China through formal channels as will fail the C4 sugar test. FYI, very little of 'the good' stuff >15+ is able to get through to China due to high levels of C4 sugar (particularly in the past two seasons of poor weather).

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    Quote Originally Posted by Left field View Post
    Hi Ogg, even without my trusty stethoscope, I seem to detect a slight case of 'investor bias' in your recent posts.

    The cure is quite simple, and merely requires listening with an open mind.

    I wish you a speedy recovery.
    You mean "New Zealand bias"...I'm here so we all don't get ripped off.

    I get that alot of people here are probably bitter because they bought in alot higher and have made a loss. Or because of the disappointing few years that have derailed what was once one of the "stock market darlings" on here.

    We can argue about monopolies, market share, or what a fair PE is all day but what gets me most excited about this company is what will happen 5, 10, 15 years from now. The NZX is just fulled with so many "divy" stocks that we forget that there's a bigger long term picture out there. Fundamentally, I'm in this for the macroeconomics of this play, I'm not worried about the weather in NZ short term or if there is other local competition.

    Even the likes of Sea Dragon, with all it's balance sheet problems, is likely being eyed up overseas. The recent run up of A2 Milk is testament to the changing global market place and the value of world class brands and the value of NZ's reputation as a prime asset and safe investment enviroment.

    I'd admit I'm on here to rally the troops and make a quick buck. I'm not saying this is worth mega bucks. I'm saying it's worth $10 per share minimum for a take over given the current situation.

  6. #1036
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    Quote Originally Posted by Ogg View Post
    You mean "New Zealand bias"...I'm here so we all don't get ripped off.

    I get that alot of people here are probably bitter because they bought in alot higher and have made a loss. Or because of the disappointing few years that have derailed what was once one of the "stock market darlings" on here.

    We can argue about monopolies, market share, or what a fair PE is all day but what gets me most excited about this company is what will happen 5, 10, 15 years from now. The NZX is just fulled with so many "divy" stocks that we forget that there's a bigger long term picture out there. Fundamentally, I'm in this for the macroeconomics of this play, I'm not worried about the weather in NZ short term or if there is other local competition.

    Even the likes of Sea Dragon, with all it's balance sheet problems, is likely being eyed up overseas. The recent run up of A2 Milk is testament to the changing global market place and the value of world class brands and the value of NZ's reputation as a prime asset and safe investment enviroment.

    I'd admit I'm on here to rally the troops and make a quick buck. I'm not saying this is worth mega bucks. I'm saying it's worth $10 per share minimum for a take over given the current situation.
    Ogg, appreciating your enthusiasm.

    If at any stage you are running out of arguments - I am sure you will find many more reasons why this company will succeed on the PEB, the WYN, the RAK, the MPG (ouch), the CBL (ouch) or on the CRP thread; Even the crypto threads might provide a lesson or two ; Just a hint - obviously every company / security is different. Look for the similarities, not for the differences to learn from.

    Just curious ... are there any risks you could see which would turn your amazing vision about CVT's future to custard?

    How likely are they to eventuate?

    Not saying this ship will go down (though I have problems imagining its rocket like launch either), but before you buy a vessel it is always a good idea to first do some research what issues others might have had in the past. Always cheaper to learn from other peoples mistakes instead of repeating them ....

    Discl: never did hold CVT (i.e. I missed an amazing uptrend) but not bitter about that. It just hurts sometimes to see people hurting themselves by tapping into the same old traps ... much more fun to make new mistakes

    All the best to you!
    Last edited by BlackPeter; 20-04-2018 at 10:59 AM.
    ----
    "Prediction is very difficult, especially about the future" (Niels Bohr)

  7. #1037
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    Quote Originally Posted by BlackPeter View Post
    king
    Just curious ... are there any risks you could see which would turn your amazing vision about CVT's future to custard?

    How likely are they to eventuate?
    Selling food is pretty simple. I mean, yeah, there's always risks but no more than any other company. What ever risks this has A2 also has. The weather comes and goes, the myrtle rust scare was over blown, government regulation is a positive long term, old stock can be moved, competitors can be bought out. This company has been around for decades. The upside potential dwarfs the risks.

    The real risk to me is if the Chinese pull out and play games or do some Sun Tzu tactics at the last minute. All jokes aside though, why is everyone so scared here? This is a pretty safe trade. They won't pull out cause if they do the price will drop and then they will want back in. It's already on "special" and heavily discounted now.

    In any case, I'm not taking the risks, the third party who is buying this company is.

  8. #1038
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    Quote Originally Posted by Ogg View Post
    Selling food is pretty simple. I mean, yeah, there's always risks but no more than any other company. What ever risks this has A2 also has. The weather comes and goes, the myrtle rust scare was over blown, government regulation is a positive long term, old stock can be moved, competitors can be bought out. This company has been around for decades. The upside potential dwarfs the risks.

    The real risk to me is if the Chinese pull out and play games or do some Sun Tzu tactics at the last minute. All jokes aside though, why is everyone so scared here? This is a pretty safe trade. They won't pull out cause if they do the price will drop and then they will want back in. It's already on "special" and heavily discounted now.

    "In any case, I'm not taking the risks, the third party who is buying this company is.
    "

    The risk is you invest in the stock as you have stated ( $ 100K) and the third party realises- as you must have it is not a monopoly , plenty of competition , the harvest is unpredictable and they pull out ... meantime you are holding shares in a company that is not making heaps of money , potentially has another poor crop , China does not buy as much as they want to certify it better as so much is counterfeit etc , etc .....That's some risk you are taking

  9. #1039
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    Quote Originally Posted by stoploss View Post
    "

    The risk is you invest in the stock as you have stated ( $ 100K) and the third party realises- as you must have it is not a monopoly , plenty of competition , the harvest is unpredictable and they pull out ... meantime you are holding shares in a company that is not making heaps of money , potentially has another poor crop , China does not buy as much as they want to certify it better as so much is counterfeit etc , etc .....That's some risk you are taking
    Why would they buy stock at $10, top up at $7.20, then pull out at $6.85 because it rained for a few weeks? Meanwhile A2 is at $10b.

    Sistema was sold for NZD $660m, and had about $190m revenue. It was selling PLASTIC of all things! It was a great brand though.

    Where are we at today's price, $300m, maybe $400m after debt? It's worth more than that. Somewhere around $10 per share or $500m is where it should be at.

    Once the Chinese own it, the "door" will open in China because the regulators there will allow it.
    Last edited by Ogg; 20-04-2018 at 12:58 PM.

  10. #1040
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    The way I look at it is CVT have moved into a high risk option,yes there is an upside if the takeover goes through,and the downside is you have a company with poor management,no growth,and piss poor profits.The SP will reflect the downside if the takeover falls over.

    What you should be asking is where can I find a possible 20-30% profit in say 3 months time with less risk.I can think of several with a lot less downside risk.

    Disc I do not hold CVT and are not looking to invest at the mo

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