sharetrader
Page 165 of 365 FirstFirst ... 65115155161162163164165166167168169175215265 ... LastLast
Results 2,461 to 2,475 of 5466
  1. #2461
    An Awesome Cool Cat winner69's Avatar
    Join Date
    Jun 2001
    Location
    , , .
    Posts
    23,713

    Default

    Thanks snoops ..was wondering why TRA had high levels of debt ....leading to a pretty low ROIC
    “In a roaring bull market, knowledge is superfluous and experience is a handicap.”

    –Benjamin Graham”

  2. #2462
    Banned
    Join Date
    Jul 2010
    Location
    Auckland
    Posts
    12,878

    Default

    Quote Originally Posted by Snoopy View Post
    My 'Capitalised Dividend' valuation for this share was a failure. But after some soul searching, I believe that 'capitalising earnings' is a more realistic way to go.

    Turners Automotive Group Limited (TNR/TRA) FY2015 FY2016 FY2017 FY2018
    Snoopy Normalised Earnings Per Share {A} 19.4c 24.2c 22.5c 25.6c
    Dividend Paid (per share) {B} 9c 12c 13c 14.5c
    Underlying Retained Earnings (per share) {A}-{B} 10.4c 12.2c 9.5c 11.1c

    I favour using at least five years of data when doing an exercise like this. However, when considering a company as fast evolving as Turners Automotive Group there comes a point when historical data used as a proxy for what might happen going forwards becomes positively antiquated. So I have reverted to using just four years of data which covers the period from when TRA was conceived in its current form.

    The valuation is in two parts. Once again I am using an acceptable gross return of 7.5% for the dividend part of it.

    Average dividend received over the last four years

    (9c+12+13c+14.5c) / 4 = 48.5c, divide by four = 12.1c

    Gross Capitalised Dividend Component = 12.1c / (0.075 x 0.72) = $2.24 (1)

    Average Retained Earnings Valuation reinvested over the last four years

    All things going to best plan, retained earnings should be worth more than cash paid as a dividend. But this assumes a largely monotonic increasing profit year in year out, with very few exceptions. I don't believe that the historical underlying profitability data indicates that Turners can achieve this. So I think it wise to assume that a 'dividend in the bank account' is worth more than a 'potential dividend in the bush'. To reflect 'business execution' and 'car market volatility' risks, I am going to increase my required return for 'retained earnings' by two percentage points, out to 9.5%

    (10.4 + 12.2 + 9.5 + 11.1)/4 = 10.8c (average)

    Gross Capitalised Retained Earnings Component = 10.8c / (0.095 x 0.72) = $1.58 (2)

    So my total 'fair valuation' for TRA becomes (1) + (2):

    $2.24 + $1.58 = $3.82

    Thus at a market price of just over $3, it looks like TRA might be worth accumulating!

    SNOOPY
    Eureka ! Interestingly this is very close to where I see fair value using my modified version of Ben Graham's formula ($4) and where the famous Couta1 reversion theory has it at $3.84. Take an average of all our valuations and you get ($4 + $3.82 + $3.84) / 3 = $3.89. So we're all in agreement then...

    The only fly in the ointment is the two analysts covering it don't see it that way.
    Last edited by Beagle; 20-06-2018 at 09:28 AM.

  3. #2463
    Legend
    Join Date
    Jun 2004
    Location
    , , New Zealand.
    Posts
    6,261

    Default

    Quote Originally Posted by Snoopy View Post
    I think I can offer some numbers on the earnings potential of the debt collection division. The divisional operating profit is shown as $3,501m for FY2014. Just like the finance division that I have just analysed, I believe you have to take off a share of corporate costs to get a true EBIT picture. For the debt collection division, this works out to be $11,310. so

    EBIT (debt collection) = $3.501m - $0.01131m = $3,490m

    We are told segment assets are $13,615m

    So EBIT / Segment Assets = $3,490m / $13,615m = 25.6%

    That is an astonishing rate of return, three times better than their own well performed finance business when measured with the same measuring stick. Not too far short of that 37% that Percy, perhaps only slightly optimistically, calculated. More evidence that the premium price that DPC trades at with respect to other finance companies is justified?
    There isn't too much discussion on the EC Credit division of Turners on this forum. Perhaps there should be more? There was an article in the June 10th edition of the Sunday Star times 'Business Section' on the debt collection business in NZ in general. A very small part of that article mentions EC Credit. I think a couple of quotes from that article would be of interest to Turners shareholders.

    "Dave Wilson from EC Credit Control, New Zealand's largest debt collection agency, thinks the Australian push to create a debt sales market of scale in New Zealand is doomed to fail. 'A number of companies like Kessler and TDX have decided to push the debt side of things in NZ and it hasn't had an impact' he said."

    <snip>

    "Wilson had met officials who were very interested in the debt collection and repossession industry, and he believed the threat of law reforms would have a chilling effect on debt sales."

    'I would be very nervous about an agency that bought debt and adds 40 to 50 percent to the debt that it's been sold.' Wilson said. He believed that such high additional fees could be deemed 'excessive'.

    "By contrast debt collectors such as EC Credit Control. which is owned by NZ listed market company Turners, were paid a success fee of around 15 to 20 percent by the company that hired them."

    After reading that I started to feel all warm and fuzzy about the comparatively compassionate service we Turners shareholders are offering to those dastardly debtors!

    SNOOPY
    Last edited by Snoopy; 20-06-2018 at 01:09 PM.
    To be free or not to be free. That is the cash-flow question....

  4. #2464
    Senior Member
    Join Date
    Sep 2009
    Posts
    1,074

    Default

    Think Baycorp.A jewel in the crown?

  5. #2465
    Banned
    Join Date
    Jul 2010
    Location
    Auckland
    Posts
    12,878

    Default

    The market is just starting to wake up to the value of Turners shares. Good brave move by Todd Hunter to come on here and clarify a few things and then follow that up by engaging with shareholders in their inaugural series of shareholder briefings right around the country. Good stuff and well done !

  6. #2466
    Legend minimoke's Avatar
    Join Date
    Mar 2005
    Location
    Christchurch, New Zealand.
    Posts
    6,375

    Default

    Quote Originally Posted by Beagle View Post
    The market is just starting to wake up to the value of Turners shares. !
    Funny old world. I bought Turners at IPO way back in 2002 for $1.50 and sold in 2006 for $1.69 for a 13% (exc divis) gain over that period.

    I'm back on the horse again and expecting a better ride this time around. So far up 4.7% in 2 weeks - so I have started off well.

  7. #2467
    percy
    Join Date
    Oct 2009
    Location
    christchurch
    Posts
    13,060

    Default

    Quote Originally Posted by minimoke View Post
    Funny old world. I bought Turners at IPO way back in 2002 for $1.50 and sold in 2006 for $1.69 for a 13% (exc divis) gain over that period.

    I'm back on the horse again and expecting a better ride this time around. So far up 4.7% in 2 weeks - so I have started off well.
    TRA's share price has moved ahead of 10,20,30,60,90,120 and 180 day moving averages,so would appear you brought at the right time to enjoy the upward share price trajectory.

  8. #2468
    Banned
    Join Date
    Jul 2010
    Location
    Auckland
    Posts
    12,878

    Default

    Quote Originally Posted by minimoke View Post
    Funny old world. I bought Turners at IPO way back in 2002 for $1.50 and sold in 2006 for $1.69 for a 13% (exc divis) gain over that period.

    I'm back on the horse again and expecting a better ride this time around. So far up 4.7% in 2 weeks - so I have started off well.
    Giddy up

  9. #2469
    Trying to get outta here
    Join Date
    Nov 2013
    Posts
    6,289

    Default

    Quote Originally Posted by minimoke View Post
    Funny old world. I bought Turners at IPO way back in 2002 for $1.50 and sold in 2006 for $1.69 for a 13% (exc divis) gain over that period.

    I'm back on the horse again and expecting a better ride this time around. So far up 4.7% in 2 weeks - so I have started off well.
    I'm up roughly the same and looking forward to my $3.83 target price.

  10. #2470
    An Awesome Cool Cat winner69's Avatar
    Join Date
    Jun 2001
    Location
    , , .
    Posts
    23,713

    Default

    Quote Originally Posted by couta1 View Post
    I'm up roughly the same and looking forward to my $3.83 target price.
    Momentum is a powerful force and it’s sure building with TRA

    We’ll see 320 next week and Couts I reckon we’ll see your 383 even earlier than you envisaged.

    Hard to stop juggernauts ..especially when they are accelerating fast
    “In a roaring bull market, knowledge is superfluous and experience is a handicap.”

    –Benjamin Graham”

  11. #2471
    An Awesome Cool Cat winner69's Avatar
    Join Date
    Jun 2001
    Location
    , , .
    Posts
    23,713

    Default

    Always good when head honcho buys shares ..all 25,000 of them recently

    I seem to have more faith in the company’s recent performance than he does ha ha (can’t match his previous purchases though)
    Last edited by winner69; 22-06-2018 at 08:51 AM.
    “In a roaring bull market, knowledge is superfluous and experience is a handicap.”

    –Benjamin Graham”

  12. #2472
    percy
    Join Date
    Oct 2009
    Location
    christchurch
    Posts
    13,060

    Default

    Quote Originally Posted by winner69 View Post
    Always good when head honcho buys shares ..all 25,000 of them recently

    I seem to have more faith in the company’s recent performance than he does ha ha (can’t match his previous purchases though)
    Try............................................... ...........lol.

  13. #2473
    Guru
    Join Date
    Apr 2003
    Location
    Wellington, New Zealand
    Posts
    3,149

    Default

    Quote Originally Posted by winner69 View Post
    Always good when head honcho buys shares ..all 25,000 of them recently

    I seem to have more faith in the company’s recent performance than he does ha ha (can’t match his previous purchases though)
    I agree but am puzzled how he managed to make an on market purchase of 25k shares at $2.93 on 19 June?

  14. #2474
    percy
    Join Date
    Oct 2009
    Location
    christchurch
    Posts
    13,060

    Default

    Quote Originally Posted by blackcap View Post
    I agree but am puzzled how he managed to make an on market purchase of 25k shares at $2.93 on 19 June?
    Very difficult when Yahoo Finance show the low for that day was $3.03.

  15. #2475
    An Awesome Cool Cat winner69's Avatar
    Join Date
    Jun 2001
    Location
    , , .
    Posts
    23,713

    Default

    Quote Originally Posted by percy View Post
    Very difficult when Yahoo Finance show the low for that day was $3.03.
    Maybe it was a quiet day in the office and Todd filled the day in with a bit of day trading and the $2.9291 is the average cost over the day. Car guys can’t resist a bit of gambling eh.

    Hoping he’s not covering his shorts
    “In a roaring bull market, knowledge is superfluous and experience is a handicap.”

    –Benjamin Graham”

Tags for this Thread

Bookmarks

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •