SUM - Summerset Group

[couta1]

Hi Mac, Yes I may have screwed up on my CNU holding but I got this one right I have 145k Summer set shares and wouldn't mind more I backed the truck up a few weeks ago as Roger did and can totally endorse his comments and projections, Summer set is the only one of the big 3 currently quite undervalued,I estimate Sum current true value at around $3.80, Met at $4 and Rym at $6.9, I think Met has run ahead of itself and Rym is fully valued my advise for any members thinking of buying Sum do so before next year or you'll miss the boat, double your money in 5 years in Rym or triple it in Sum your choice

[couta1]

Mac I'm basing my value of Rym on them succeeding in Aussie so I think our values are fairly close even if Rym succeeds in Aussie their bottom line profit will be significantly less than in Nz due to higher operating costs and intense union involvement on behalf of their workers etc it seems the market has been wrong on Sums value for some time now

[Beagle]

I agree Couta with all that and have a larger holding in SUM, for comparison my FA provides me with SUM $3.86, MET $3.78 and RYM $5.74.

That’s not to say that the entire retirement sector will not continue to progress further and may well hold above fundamental valuation for some time. The demographic trends and defensive nature of the sector could well be enduring for some years if not a decade or so. My views on this reside here;

http://www.sharetrader.co.nz/showthr...538#post423538

SUM's peg ratio is very very cheap for this sector.
I took my boat up yesterday to look at their new Hobsonville site from the water, its going to be a highly appealling large new development in my opinion. The approval of this site development, the removal of the Quadrant overhang and the fourth consequentive award this morning are all value accretive in terms of improving what is allready a highly attractive stock in my opinion.
Oh and they are not adverse at all to owners having a pet with them in retirement and seeing as I'm dog obsessed this makes them more user friendly.

[couta1]

Hi Roger, Another Summerset gem once it gets the go ahead will be the Boulcott site in lower Hurt a prize location right behind the central Hutt and hospital etc overlooking the river interesting this site will be smack bang distance wise between the Rym village in Avalon and its yet to start Petone site but by far the most attractive sites of the 3

[Goldstein]

Well done to the team at Summerset, surely and absolutely undeniably now the best company in the sector.

Yep, I hope they do everything they can to protect their name. They are building a very good brand.

RYM have had a few slip ups regarding resident care and also building faults.

[winner69]

We'll be ok as long as the government doesn't get the idea that excessive profits are being made in this sector and do something about it.

How much government cash do the likes of rym and sum collect?

[couta1]

Winner the Govt funding is currently under what it takes to run the care centre portion of the retirement villages any that choose to pay caregivers above the minimum wage do so out of there own profits why do you think so many small operators have gone out of business over the last few years all the profits come from sale of new units and resale of the same so to answer your question the sector is already underfunded by the Government

[couta1]

Further to that if the Government were to reduce funding some more, companies with mainly care centres only would get to the point where it would be considered unviable to continue operating in Nz they produce some profit by continually cutting costs and reviewing staff rosters, you can't mix the profits that Sum/Ryman/Met make with care centre funding they are separate animals and most people on this forum wouldn't understand that

[winner69]

I wasn't really only thinking about the funding they give

Maybe some industrious person in the MBIE will think heck these guys make exorbitant profits and some of their income comes from us so we better curb that .....and get even more confused when they see the money made on building things so somehow cap that .....and even tie that into an affordable home policy.

So question is .....could the government intervene to stop excessive profits in this sector?

[couta1]

Winner with the ever increasing need and demand I think it would take a very foolish Government to interfere in this sector unless they want poorer levels of care as a spin of which I think Labour/Greens would be even more adverse to than National