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- TRA - Turners Automotive Group [previously TNR - Turners Limited]
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01-12-2018, 08:57 AM
#3681
About 4 years ago the SP was 28 cps before the 10:1 share consolidation ($2.80) so we have seen truly woeful performance relative to the NZX50. What this suggests to me is there's actually not a lot of money in the used car game and its a very, very tough industry.
Market over supplied at present ? The management team reckon there's market consolidation to come.
Interesting times in the industry.
AHG in Australia continues to get smashed.
But none of this is a concern because our resident optimist who has been talking this up consistently for years now tells us the share price is going to double in 2-3 years
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
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01-12-2018, 10:07 AM
#3682
Originally Posted by McGinty
Have you heard of a investor called Stan Druckenmiller, apparently he does use TA to guide him on investment decisions and he's only managed to return over 30% p.a over the last 30 years (yes that does beat Buffett).
https://www.youtube.com/watch?v=G-MlrpoMig0
A good interview of a man who seldom does interviews
No never heard of him.
Thanks for posting the link and I look forward to watching it.
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01-12-2018, 10:09 AM
#3683
Originally Posted by Beagle
About 4 years ago the SP was 28 cps before the 10:1 share consolidation ($2.80) so we have seen truly woeful performance relative to the NZX50. What this suggests to me is there's actually not a lot of money in the used car game and its a very, very tough industry.
Market over supplied at present ? The management team reckon there's market consolidation to come.
Interesting times in the industry.
AHG in Australia continues to get smashed.
But none of this is a concern because our resident optimist who has been talking this up consistently for years now tells us the share price is going to double in 2-3 years
I still think they have the right business strategy, that will prove their business model is excellent,and will produce long term benefits to shareholders.
I think they have the right board and management in place.
Last edited by percy; 01-12-2018 at 10:15 AM.
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01-12-2018, 10:52 AM
#3684
Originally Posted by Beagle
About 4 years ago the SP was 28 cps before the 10:1 share consolidation ($2.80) so we have seen truly woeful performance relative to the NZX50. What this suggests to me is there's actually not a lot of money in the used car game and its a very, very tough industry.
I agree. One of my key investment goals is only investing in shares that are likely to outperform NZX50. Still not tempted by TRA even though the insurance, property and finance sides help shore it up. It needs to prove its model a tab more. That said, I like that the CEO takes an interest in, and responds to this forum.
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01-12-2018, 11:13 AM
#3685
Macro investors - Druckenmiller, Soros and Rogers are all better than Buffet just less vocal about it and far less lovable.
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01-12-2018, 02:00 PM
#3686
Originally Posted by brain
The Charts tell the History. Management ability will determine the future.
Originally Posted by minimoke
If that truism was indeed true we should be able to back test it.
So lets wind the clock back two years and apply it.
Back then SP was about $3.50. We invest relying on management's ability to determine the future.
For 5 months management do a great job determining the future and as a result the SP rises to $3.90. Excellent. We have about a 10% rise enjoying those glorious dividends.
From May 2017 management keep determining the future. And they have delivered great divvies (Percy:- 5% - 6% PA??). One year later SP is at $3.00. Hmm a 25% drop in capital value
Never fear. We have faith in management determining the future.
Hmm. Nov SP is at $2.50. A bit over a further 15% drop in capital value while those 6% dvies have flooded in.
Do we continue to have faith in management. No!
Do the charts tell us anything?. Yes Whatever management has done is eroding shareholder wealth.
So do I have faith in Management. No.
But I do have faith in the market and management to manipulate the SP sufficiently to return me a gain on my @investment@.
I would suggest that there are many things management can influence. But the one thing they cannot influence is the share price. That would be illegal and they would be potentially subject to prosecution if they tried. The only thing that management/'the board' can do to boost the TRA share price is to buy shares 'on market' in the small window of time following the announcement of a result, which allows insiders to purchase. Grant Baker has certainly done this.
From the 'Investment Story' thread we can see that the underlying historical PE ratio at 30-09-2017 was 14.9. That declined to 13.1 a year later. It is difficult to forecast what the PE will be at 30-09-2019, because we don't know what one off insurance adjustments or property sales Turners are counting on to meet their profit projections. With the share price declining to $2.50ish it does seem that the underlying PE is liable to shrink again. So a significant proportion of the share price decline can be explained by the PE ratio contraction over the period. This is outside of management control. Shareholders cannot be told what multiple they should pay for TRA earnings.
The final point I wanted to make concerns the break up of 'the Business Bakery', with formers shareholders of that cornerstone stake in TRA going their own way. We should assume that the Business Bakery stakeholders expect to go off on their own tangents into the future. Grant Baker may be buying. But others may be creating an overhang of expected share sales. This isn't good for the share price. But once again today's management can do nothing about that.
SNOOPY
Last edited by Snoopy; 01-12-2018 at 02:42 PM.
Watch out for the most persistent and dangerous version of Covid-19: B.S.24/7
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01-12-2018, 02:27 PM
#3687
Milford still appear to be in love with Turners even though underwater
Good to see gurus share percy’s, snoopy’s, couta’s and beagle’s view that Turners are something special
Don’t think Salt have sold any for a while ...even more support.
“ At the top of every bubble, everyone is convinced it's not yet a bubble.”
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01-12-2018, 02:30 PM
#3688
Originally Posted by Snoopy
I would suggest that there are many things management can influence. But the one thing they cannot influence is the share price.
Of course they influence the share price - everything they do is subject to a market reaction. Which is why a share buy back is an attempt to influence the market to a higher SP.
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01-12-2018, 02:36 PM
#3689
Originally Posted by minimoke
Of course they influence the share price - everything they do is subject to a market reaction. Which is why a share buy back is an attempt to influence the market to a higher SP.
That’s quite polite way of saying it ....some might say the buyback is an attempt to dig themselves out of the proverbial (using share holders money that they recently collected of them)
“ At the top of every bubble, everyone is convinced it's not yet a bubble.”
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01-12-2018, 02:54 PM
#3690
Originally Posted by minimoke
Of course they influence the share price - everything they do is subject to a market reaction.
The issue is, TRA management can't control what the market reaction will be. If 'eps' goes up (which management can influence) and market sentiment reduces the PE value of those earnings to the extent that the share price declines.... then...there is nothing management can do (in the short term).
To build trust amongst investors, sometimes you need clarity and consistency of earnings. This can take time.
Which is why a share buy back is an attempt to influence the market to a higher SP.
A share buyback changes the underlying mathematics of how earnings are distributed. The same profit distributed over less shares means higher earnings per share. So if the market is prepared to pay a certain PE ratio for TRA shares then the price that the market will pay post buy back should go up. This isn't influencing the market. Quite the contrary: It is assuming the market's attitude to TRA remains unchanged!
SNOOPY
Last edited by Snoopy; 02-12-2018 at 09:36 PM.
Watch out for the most persistent and dangerous version of Covid-19: B.S.24/7
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