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28-06-2019, 09:08 AM
#8001
Colder Weather for Summerset?
Forsyth downgraded SUM price target by 10% today to $6.60 (still way above current share price I suppose)... FY19 earnings downgraded 8%, FY20 downgraded 11% and FY21 downgraded 14%... they clearly have started to see the writing on the wall and realize the market simply wasn't buying their previous $7.35 price target... as I've said before, while sum companies are increasing build rates, margins, and earnings throughout the cycle, sum others are really struggling... sum say this is because those companies were too focused on short term profits (build more and more and more!) rather than focusing on building culture and continuum of care capabilities (which short term: of course they drag on earnings, but long term: support the entire value proposition of the village[s])... the 'gold standard' Ryman has always focused on its care side of things just as much as its development, you'd think sum would have learned there is a reason why they did this and didn't just build lots of units.
Ironic that we were told for years by sum on here that how sum is a great long term investment, will only go up (or words to that effect)... and yet it seems sum were all about borrow high, build big, and cross our fingers things sell... while in the back end the care side of things was severely under developed (not only in terms of beds to units ratio but also in strategy and capability) and the housing market was slowing down... all accumulating in an overhang of units, not a very strong value proposition (to move into a sum village), and a dramatic downgrade in build rate from 600 to 300 ish while they try fix things.
And yet we still hear about the past, about how sum outperformed in the past... of course if you put short term profits ahead of long term prospects and combine that with a huge appreciation in house prices, you will outperform... but these things never last, and I don't know about sum other people, but I don't live in the past.
Ah well, at least sum isn't alone... MET also did the same (and they have leaky buildings as well!)
Last edited by trader_jackson; 28-06-2019 at 09:25 AM.
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28-06-2019, 09:30 AM
#8002
Originally Posted by trader_jackson
Forsyth downgraded SUM price target by 10% today to $6.60 (still way above current share price I suppose)... FY19 earnings downgraded 8%, FY20 downgraded 11% and FY21 downgraded 14%... they clearly have started to see the writing on the wall and realize the market simply wasn't buying their previous $7.35 price target... as I've said before, while sum companies are increasing build rates, margins, and earnings throughout the cycle, sum others are really struggling... sum say this is because those companies were too focused on short term profits (build more and more and more!) rather than focusing on building culture and continuum of care capabilities (which short term: of course they drag on earnings, but long term: support the entire value proposition of the village[s])... the 'gold standard' Ryman has always focused on its care side of things just as much as its development, you'd think sum would have learned there is a reason why they did this and didn't just build lots of units.
Ironic that we were told for years by sum on here that how sum is a great long term investment, will only go up (or words to that effect)... and yet it seems sum were all about borrow high, build big, and cross our fingers things sell... while in the back end the care side of things was severely under developed (not only in terms of beds to units ratio but also in strategy and capability) and the housing market was slowing down... all accumulating in an overhang of units, not a very strong value proposition (to move into a sum village), and a dramatic downgrade in build rate from 600 to 300 ish while they try fix things.
And yet we still hear about the past, about how sum outperformed in the past... of course if you put short term profits ahead of long term prospects and combine that with a huge appreciation in house prices, you will outperform... but these things never last, and I don't know about sum other people, but I don't live in the past.
Ah well, at least sum isn't alone... MET also did the same (and they have leaky buildings as well!)
i imagine more people will dump summerset now after this big downgrade
one step ahead of the herd
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28-06-2019, 09:35 AM
#8003
Originally Posted by bull....
i imagine more people will dump summerset now after this big downgrade
I am sorry, but many here including myself don't rate Forsyth Barr as giving consistent fantastic advice. I would not rate SUM as being worth $7.35 nor Ryman what they are worth. The market determines the value of share price.
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28-06-2019, 09:38 AM
#8004
Originally Posted by Ggcc
I am sorry, but many here including myself don't rate Forsyth Barr as giving consistent fantastic advice. I would not rate SUM as being worth $7.35 nor Ryman what they are worth. The market determines the value of share price.
yes correct the market does judge what the shares are worth and it is not looking pretty at the moment. estabilished downtrend in price suggest lower prices for sure are coming unless there is some catalyst to change the trend but i dont see anything at the moment.
one step ahead of the herd
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28-06-2019, 10:56 AM
#8005
Originally Posted by bull....
i imagine more people will dump summerset now after this big downgrade
Hmm - why would anybody dump a share at or below $5.50 if the same people who downgraded the earnings from "outrageous" to "great" proposed a price target of $6.60?
Your post does not make sense ....
----
"Prediction is very difficult, especially about the future" (Niels Bohr)
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28-06-2019, 11:10 AM
#8006
Originally Posted by BlackPeter
Hmm - why would anybody dump a share at or below $5.50 if the same people who downgraded the earnings from "outrageous" to "great" proposed a price target of $6.60?
Your post does not make sense ....
lowering of a price target is a downgrade if they put there target price up that would be a upgrade. take the price levels with a grain of salt
one step ahead of the herd
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28-06-2019, 01:49 PM
#8007
Strangely, though, not everyone pays a lot of attention to FB's downgrades/upgrades. There are those who see them as potential buy/sell signals, respectively!
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28-06-2019, 01:57 PM
#8008
Originally Posted by macduffy
Strangely, though, not everyone pays a lot of attention to FB's downgrades/upgrades. There are those who see them as potential buy/sell signals, respectively!
Reminds me of the widower, who could not understand how his late wife's share portfolio, was worth a great deal more than his,until he figured out she read his broker's recommendations, and brought those shares,but never followed on his sell recmmendations. .
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01-07-2019, 07:32 AM
#8009
Member
https://www.stuff.co.nz/business/113...it-record-lows
Quote "The Auckland region saw asking prices creep back up over $900,000 on average, after a three month slump"
Trend turning?
Last edited by tuaman; 01-07-2019 at 07:36 AM.
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01-07-2019, 08:32 AM
#8010
Originally Posted by tuaman
not too fast....property market moves around 7-8 years....it will plateauing....the next move will be next 5 years....
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