SUM - Summerset Group

[Hoop]

Couta1....True but unfortunately Sum seems to be plagued by an overdose of fickle shareholders who don't understand the real long term value of the company,

OCR now at 3%..as expected...
Maybe SUM and RYM were factoring in this changing variable over the last few weeks. ...RBNZ telegraphed earlier that more OCR rises to come this year and next...

[couta1]

Couta1....True but unfortunately Sum seems to be plagued by an overdose of fickle shareholders who don't understand the real long term value of the company,

OCR now at 3%..as expected...
Maybe SUM and RYM were factoring in this changing variable over the last few weeks. ...RBNZ telegraphed earlier that more OCR rises to come this year and next...

Yep could be,I had this impression when I wrote post #1844 and I guess this will be offset once the next set of good results from either company roll out

[couta1]

Yeah um no

NTA is calculated for retirement villages based on mark to market pricing of the underlying villages prepared by CBRE and other valuers, and these are usually pretty generous.

Ok, the care businesses 'value' wont be included in the NTA but lets be real - that is a small proportion of value. Also, the ability to grow future revenue from existing land banks is not included, but at most this should be a 20%-30% premium to NTA imo.

The differential between NTA and share price is going to lead to mass tears for RYM/SUM shareholders (at some stage).

'Fundamental' value does not come into it for these stocks, I'd stick to using indicators if I was playing with these puppies.

SC Dire need will drive these stocks supported by any Govt in power at the time.

[Beagle]

http://www.sharechat.co.nz/article/6...-australiahtml

N.Z. migration rises to 11 year high.

[winner69]

http://www.sharechat.co.nz/article/6...-australiahtml

N.Z. migration rises to 11 year high.

Might reach 40,000 this year

Another 14,000 homes needed (using average). Should help Fletchers

Probably not in retirement villages though ...but might help those older ones thinking of moving in a home get a good price for their home

O those 40,000 probably all left the country again before they need a home

[Beagle]

As others have noted there's been a clear break below the 100 day moving average and technically the stock looks broken.
This situation isn't helped by Mrs Barlow unloading the vast majority of her stake in what in my view as previously articulated amounts to questionable circumstances, (just before a very disappointing Q1 sales result was announced). Its all very well for one to talk about a potential significant uptick in Q3 sales but that's nearly six months away and is only talk at this stage. Regardless one way or the other on that speculation the fact remains that there's lots of water to go under the bridge before 10 October 2014 when that might be announced and there's always some execution risk when you try to sucessfully bring all development activities in-house, (obviously you don't find highly experienced and effective construction and project managers on any old street corner).
Sum looks fairly valued (on an adjusted fair value earnings basis at a PE of 33) to me at this point in time and accordingly I have reduced my overweight position and expect a flat / market under-performing SP performance until they get more runs on the board.

[couta1]

Roger I'm interested on how you view Ryman at the moment based on your opinion that they were fully valued and Sum was the better prospect? I think Sum will be back over $3.40 next week.

[couta1]

Roger, I don't think many people invest in this stock on day trader basis (compared to other more volatile stocks). Accordingly, breaking the 100MA or whatever is largely irrelevant. Its unlikely to fuel a downward traders spiral so best forgotten. Technically broken or not, its still fundamentally sound IMHO and so I won't be reducing my position.

I reckon it will move back above the MA100 next week and will be dragged higher by Rymans upcoming half year result in June,they always move as a pair to a certain extent.

[Beagle]

Roger I'm interested on how you view Ryman at the moment based on your opinion that they were fully valued and Sum was the better prospect? I think Sum will be back over $3.40 next week.

Ryman appear to be trading on a PE of about 30 and are probably over-priced based a growth rate of 20% in my opinion. I'm expecting expansion in Australia to be a significant execution risk for the company.

Newguy, Technical analysis isn't about day trader stuff as I am sure you are aware. Breaking the 100 day moving average represents a genuine change in the momentum of the stock on a weighted average and time adjusted basis over 3 months and the way I see it for a company to so effusivly talk about itself as a growth stock and then report a quarters sales that are ostensibly unchanged from a whopping two years ago doesn't cut the mustard when you're talking about these sort of lofty PE ratio's. Its not like they're paying you to wait with decent dividends is it ! They don't have the lengthy and sustained earnings growth record of Ryman to fall back upon so they need more runs on the board to justify the present price earnings ratio. Its a good long term growth story but I expect the SP for the next quarter or two to under-perform. They've basically done nothing for me in terms of my five months of investment since early November 2013 so i'm bored waiting.
I think globally we will see a shift to value stocks as interest rates rise and lofty price earnings multiples with implied poor dividend yeilds could come under pressure. I still have some but am activly seeking a more diversified portfolio.

[Beagle]

I reckon it will move back above the MA100 next week and will be dragged higher by Rymans upcoming half year result in June,they always move as a pair to a certain extent.

You must have a different chart than I have mate. 1 Year to 24 April 2014 RYM up 46%, SUM up only 12%.
Wonder why Mr Saunders, General manager sales and marketing was selling in December and now Mrs Barlow selling out most of her stake in April.
Recently I noticed SUM advertising for a new head of construction manager, Wellington postion, I wonder if they managed to fill that position and how excellent is the calibre of the new person given the huge deamnd for high calibre people in this sector with the Chrustchurch rebuild and all......like I said mate, there's execution risk bringing in all development in-house, maybe that's part of the reason for the disappointing Q1 sales result ?