STU - Steel & Tube Holdings

[winner69]

There is some I in the P&L - in F21 the I was about $5.7m .....mainly related to leases ... prob about the same this year

Question: probably won't be paying much tax F22 but will in F23. question then when assessing a 'fair' PE ratio do you apply a notional tax expense

[Muse]

There is some I in the P&L - in F21 the I was about $5.7m .....mainly related to leases ... prob about the same this year

Question: probably won't be paying much tax F22 but will in F23. question then when assessing a 'fair' PE ratio do you apply a notional tax expense

Personally I apply a notional tax if the tax credits aren't expected to run for years, to get a better feel for a maintainable PE.

Wonder if the analysts will just regurgitate the press release in their reports overnight, update their TP to reflect where prices closed at, and close at a mighty 2-3 page report. nice if they do, leaving buying opportunities for those willing to do the work. those covering STU do zero work....

[winner69]

Vulcan and STU both have updated 5 months sales

Volumes - Vulcan +11% pcp and STU +11% pcp
Revenue - Vulcan +35% pcp and STU +22% pcp

The revenue comparison a bit of a worry - same volume increases but Vulcan much higher revenue increases - sort of says getting better prices .... and getting highr margins than STU

Didn't split Aust and NZ - must be screwing Aussie customers big time lol

[Muse]

Vulcan and STU both have updated 5 months sales

Volumes - Vulcan +11% pcp and STU +11% pcp
Revenue - Vulcan +35% pcp and STU +22% pcp

The revenue comparison a bit of a worry - same volume increases but Vulcan much higher revenue increases - sort of says getting better prices .... and getting highr margins than STU

Didn't split Aust and NZ - must be screwing Aussie customers big time lol

Could be mix - vulcan have a sizeable stainless operation, stu do more reinforcing, roofing and wire (or so i read in the nbr).

Shareguy would this account for the difference or do you reckon something else at play?

[Shareguy]

Stu also have a stainless division from when they purchased NZF fasteners. Stu don’t have a distribution business in Australia. However comparing STU sales to the old One Steel business, Stu made a lot more money (ROI) with better margins. The main reasons were the cost of doing business was a lot higher in Australia with wages being considerably higher than New Zealand in part due to the strong unions. Plus more competition. The S&T roofing division is a licence to print money and has always been very profitable and so was the piping and fasteners operations. Not surprised with Vulcan margins as they have over the years poached the best staff and put a lot of emphasis into customer relationships therefore obtaining a premium. This is changing though under New Ceo so I expect this to change in a positive way for stu. Investors need to consider that in the past few years stu has taken a huge amount of cost out with massive write downs of inventory and all the skeletons have been delt with. They also have 15 cps of cash which is unusual for a distribution business. As you no I have a large holding (more than ceo) and have a high conviction that this stock has only woken up with plenty of up side.

[winner69]

Vulcan said Steel: volumes +12% / revenues +42% and Metals: volume +7% revenues +22%

STU said Distribution; volumes +16% / revenues +35% and Infrastructure; volumes +4% / Revenue +5%

Don't know if sectors are similar but whatever Vulcan seem to be doing better at pricing

Hey shareguy -- work it out for usit

It's just that I like companies maximising profits (v competitors) and not missing out on things otehr are getting - even reminding us sales people are going for margin doesn't explain it

[Balance]

https://blog.steelandtube.co.nz/pric...n-october-2021

Notification of last steel price increases for customers

[SailorRob]

Where were all you keen bullish folk at 52c?

Nobody would even reply to posts on STU!

Off historical performance fair value is $1.50, maybe they really a better company now. Maybe not. Everyone is so keen after the price has run hard.

As for NZ macroeconomic outlook and building industry... Does anyone really know?

[Balance]

Where were all you keen bullish folk at 52c?

Nobody would even reply to posts on STU!

Off historical performance fair value is $1.50, maybe they really a better company now. Maybe not. Everyone is so keen after the price has run hard.

As for NZ macroeconomic outlook and building industry... Does anyone really know?

You could ask that question of any number of stocks, STU being one, FBU being another and SKT too but I prefer to ask where the punters were with SKO in my case when I bought at 29c (now $6.90).

If only we were all that smart, eh?

I cannot speak for others but one golden rule I follow closely is that I DO NOT buy stocks on the way down and definitely, I do not believe in averaging down.

I prefer to buy on the way up and my first purchase of STU was 69c and been averaging up since then.

NZ macroeconomic outlook and building industry outlook - plenty of opinions & forecasts out there so a case of doing one's own asessment and investing accordingly, surely?

[Muse]

Where were all you keen bullish folk at 52c?

Nobody would even reply to posts on STU!

Off historical performance fair value is $1.50, maybe they really a better company now. Maybe not. Everyone is so keen after the price has run hard.

As for NZ macroeconomic outlook and building industry... Does anyone really know?

To be fair I think this is just a situation where a small group of investors saw something the analysts didnt, spoke their minds, and put their money where their mouth was…Im sure shareguy will attest to not suddenly just being interested in this over the last month or two. Company went thru some hard yards and counted as down so if you cant celebrate a small victory like this when can you?

Kinda similar to what happened at Sky TV and Rakon. No these arent forever victories and the factset can change quickly.

But Im happy for everyones respective successes and these threads have kept me much more up to speed on developments that I otherwise might have been - so thanks to those who contribute - its well appreciated.