THL - Tourism Holdings

[sb9]

In the meantime, tourism boom keeps getting stronger...

http://www.nzherald.co.nz/business/n...ectid=11654138

[Jinx]

In the meantime, tourism boom keeps getting stronger...

http://www.nzherald.co.nz/business/n...ectid=11654138

Yep, that's why even with management selling some of their holdings I have no concern.
The sector has such huge growth

[Hectorplains]

Must be due for a Sharetrader 'acquisition imminent' announcement?

[Lewylewylewy]

A director wouldn't sell prior to an acquisition. Shane these shares are cyclical, otherwise I'd buy some more. I think they've got one more great year coming, then I don't know what.

[Cricketfan]

Seems to be quite a few directors selling down over the last few months. Something to be concerned about?

[Jinx]

Seems to be quite a few directors selling down over the last few months. Something to be concerned about?

$1.10 to $2.70 in two years, hardly surprising there is some profit taking.
Even if there is something to be concerned about which I don't believe there is, tourism numbers will continue to skyrocket which will continue to bring more revenue to THL.

Some more free amazing advertising for New Zealand out last week
https://www.youtube.com/watch?v=YDFH-8TBxvQ

[BlackPeter]

... tourism numbers will continue to skyrocket which will continue to bring more revenue to THL.

How do you know?

Tourism is a cyclical business - and what goes up will at some stage come down. Directors might see some indication for reduced forwards booking, but more likely they are just careful and know that no trend goes always just into one direction.

Maybe they even know why the lonely analyst in Yahoo finance values the share at $1.65 ....

Fuel cost will at some stage go up again (reducing overseas tourists)
The long awaited market crash (no - I don't know, when it comes, either) will reduce the tourism dollar in due course
Ecotourists might at some stage realise that NZ is neither green nor clean ... resulting in lower tourist numbers
Acts of terrorism related to flights might reduce tourist numbers ...

So, I think that THL is a good company, but currently more likely in the upper quadrants of its earning potential. Sure - this may continue for another season or two - who knows? However blind optimism is not always the best investment strategy.

best wishes ...

BlackPeter

Discl: not holding

[Jinx]

How do you know?
However blind optimism is not always the best investment strategy.

Well clearly I don't truly 'know' anything, the same way none of us 'know' the sun will rise tomorrow, but we all make assumptions based on previous information.

Here's the previous information we do know as fact, the New Zealand government sees tourism as a sector with huge positive impacts for the New Zealand economy thus why they are pumping money into advertising it (http://www.mbie.govt.nz/info-service...statistics.pdf) and the new budget continues to pump more money into tourism spending.

The number of tourists arriving in New Zealand has almost never decreased (2008-2009 they stayed at very similar levels) and in recent year's there has been HUGE growth (http://www.tradingeconomics.com/new-...urist-arrivals)
As global wealth increases tourism increases, there's clearly data that global wealth is increasing (like poverty rates decreasing) as well as that more wealth = more global tourism (I just don't quite have time to cite everything)

But the biggest driver is China, China's middle class is going exponentially as they move into becoming a fully developed nation. When I had the chance to talk to the associate minister of tourism as well as Key's right-hand man on China, both of their biggest pushing points were China and the growth potential in terms of tourism. Not to mention the 29% growth in Chinese visits to NZ last year (http://www.tourismnewzealand.com/markets-stats/)

I hope this answer suffices as to why my growth estimates aren't on 'blind optimism'

Best wishes,

Disc: Holding & Happy

[benjitara]

4 years ago when I started my current occupation I seldom saw a person of Asian ethnicity renting out a campervan at all. Now I'd suggest 15-20% of hires would be Asian during peak times. People go on about China being the tourism giant but India could be just as lucrative in decades to come.

I'm currently holding the stock. Will continue to hold as I have the business around 20% undervalued.

[Robomo]

Good informative post Jinx.
That explains my 40% profit since buying THL at $1.96 10 months ago. Overweight at the time in THL but the Tourism sector just had every indication of exponential growth.