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  1. #7281
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    Quote Originally Posted by trader_jackson View Post
    Not even a month ago ARV was singing a near totally different tune to SUM today: both with solid pricing and settlements... at over $6, holding up pretty well really.
    And what a difference in reactions today - ARV down not even 1% (and still above that rock solid level of $1.30), while sum others falling over 7%... Unlike sum others, the NTA and dividend yield (both of which are relatively low) ain't enough to provide a backstop, still above that physiological important $6 mark, for now
    Last edited by trader_jackson; 05-04-2019 at 04:39 PM.

  2. #7282
    ShareTrader Legend Beagle's Avatar
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    Study the past, if you would divine the future. Confucius
    SUM companies have a great long term track record, others not so much. I am not so hasty to judge a company on one days share price performance or one quarters sales results.
    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

  3. #7283
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    Since the drop in sales numbers from 143 to 137 has hit the sp, thought worth checking Barfoot's latest Property Report because the general real estate market & esp AKL feeds into the Retirement sector sales including AKL retirees moving to the provinces.
    I see Auckland sales for Jan & Feb were among lowest recorded at the start of a year in the last decade. However, also says market regaining momentum in March with sales numbers nearly doubling Feb's measly sales volume, plus now have (4,865) highest level of listings since 2011. Indicates vendors needing to adjust to realistic expectations if they want to sell or avoid having property on market for a long time.
    So I'm hoping sales for the later part of the year will be much higher as the gap between vendors & buyers expectations narrows & the built up pressure in the market is released, & this feeds into sales for SUM & others.

    Sadly, another driver is ill health & personally I know 3 cases in last 6 months where due to the sudden & unexpected onset of chronic medical conditions of one of the partners, couples have been quite desperate to sell their homes & move to the relative sanctuary of SUM (& OCA) villages. What struck me was how I would never have expected any of them to be interested in Retirement Village living but how quickly & massively the landscape can be changed by a medical diagnosis.

  4. #7284
    ShareTrader Legend Beagle's Avatar
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    http://www.scoop.co.nz/stories/BU190...ers-market.htm
    Sum's up the state of the property market. Houses taking longer to sell so SUM will have to carry more stock for a while. Not earth shatteringly bad as some people are suggesting.
    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

  5. #7285
    …just try’n to manage expectations… Maverick's Avatar
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    Quote Originally Posted by winner69 View Post
    I don’t think the numbers on page 23 provides the answer to my quandary ...but I just might be really stupid.
    hey Winner, tough day for all of us....try this . investor presentation fy18. Go to page 23

    http://nzx-prod-s7fsd7f98s.s3-websit...947/295456.pdf
    Last edited by Maverick; 05-04-2019 at 07:36 PM.

  6. #7286
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    Here's an attempt to put on the negative glasses. Hopefully this is wrong but it helps explain the price fall today on what was superfically flat year-on-year sales.

    At the end of 2017 SUM had 59 new builds and 63 resales under contract and then had sales (settlements) on 143 units in Q1
    At the end of 2018 SUM had 101 new builds and 58 resales under contract and then had sales (settlements) on 137 units in Q1

    In Q1 2018 they achieved a net +21 new sales that went under contract and settled
    In Q1 2019 they achieved a net -22 new sales that went under contract and settled.
    Longer sales times to settle explains a bit, but it kinda also indicates really poor new sales of new-build stock as they went backwards by 43 sales in this comparative view (not by 6). Its possible that theres a lot of the empty new-built under contract but if there had been a good increase in this, I'd have personally put that into the press release. Its absence probably means under contract hasn't improved much and may even be down.

    In both 2017 and 2018 SUM built more units than they settled. This resulted in Uncontracted new-sales stock going from 67 to 145 to 218. There were 133 new units in 2018 that became available in December. I'd have expected some of this to both go under contract and settle during Q1 but that's not what the figures above indicate.

    Could the market be doubting the retention of current development margins?
    Could the market be wondering if the new-build rate needs to slow?
    How long have some of the 218 uncontracted units at the end of FY2018 been available and not sold? If they aren't worth the selling offer price, what price are they held at in the books? Are there some negative revaluations to take through the P&L?

  7. #7287
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    Based on current valuation, we are now at a PE of 14 and probably due to go lower. Good point on development margin because early doors we could be looking at flat underlying profit for the year.

    If you're in the industry long term then its a very good buy. The issue of an aging population hasn't really started rearing its head yet. We are just talking about it, it will be years from now where it will become a serious issue on how we house them etc.

  8. #7288
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    If we look at sum as a company that makes and sells houses, the figures are ok but disappointing expectations.

    If we look at sum as a subscription based company, the figures are good. IOW, 71 new subscriptions with a lower attrition rate of existing subscriptions (i deduce this from the fact that there are less resales, but overall smaller stock of resellable product). Granted, subscription growth was less than last year, but they is still good growth. Revenue should be up, and they have a healthy stock ready for sale.

    Personally, I'm not upset by the result, though i am upset by the sp because I'm not in a position to be able to buy more right now.

  9. #7289
    …just try’n to manage expectations… Maverick's Avatar
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    Quote Originally Posted by Scrunch View Post

    Could the market be doubting the retention of current development margins?
    Could the market be wondering if the new-build rate needs to slow?
    excellent post Scrunch. Obviously you didn't go to the pub last night.
    Beagles link to the property article just above yours is pretty calming that NZ property is slightly falling in Auckland but generally still strong elsewhere.
    So your first question, are the units too dear? From the article that answer is -no
    Second question, are we building too many? Based on well known statistics of the aging population and penetration (amount of oldies opting into villages as a percentage of their peers) compared to village build rates, then that answer is also no.

    Therefore , for me , I'm very comfortable for now that this poor result is mostly, if not entirely, due to longer sale days needed.

    i will endeavour to find out if there is a general region where these units are.

    Once again Srunch, I appreciate your maths and thinking on this problem.
    Last edited by Maverick; 06-04-2019 at 07:57 AM.

  10. #7290
    Speedy Az winner69's Avatar
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    Summerset have to stop reporting quarterly sales

    Just causes too much speculation ...as beagle says one quarters sales numbers are meaningless.
    “ At the top of every bubble, everyone is convinced it's not yet a bubble.”

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