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18-02-2018, 03:14 PM
#2391
Originally Posted by Left field
Nice one Weasel
Only a few weeks ago posters such as Winner and Beagle were saying that THL’s growth days were possibly over or that THL “looks vulnerable to a pullback” and THL’s share price “could go nowhere for a year or two.” (refer posts #’s 2347, 2355 and 2369.)
According to NBR last week THL’s SP growth led the NZX index with 6.5% gains, riding on news of a joint venture with USA based Thor industries to drive development of a digital platform for the RV hire market (puns intended), which will no doubt build on THL’s current platforms such as;
https://www.mighway.com
https://roadtrippers.com/new-zealand
In the words of Craigs Investments partner, Greg Easton, “digitisation of some of (THL’s) services was always seen as something of huge potential”
While some posters have noted that this JV is still likely to ‘lose money’ for a couple of years, they perhaps forget the huge potential of such digitisation as we enter the realm of digital vehicles, driverless cars, and GPS guided route planning and tours.
Anyone aware of the huge success of the NZ Motorcaravan Association and its site https://www.nzmca.org.nz will get a glimpse of the digital future available to the RV market.
On Thursday 22 Feb we will get THL’s latest results update. It’s going to be interesting to watch.
The future will no doubt serve up driverless electric rv's that you select your route on roadtrippers with and off it goes
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18-02-2018, 03:44 PM
#2392
Leftfield ..I did not say thl share price might not go anywhere for a year or so.
All I did was put up a chart that told a story any one you wanted ....and mentioned that one of those stories could be beagles view that it might not go anywhere.
Chart looks even better and I’m happy with that. My holding is dependent on market sentiment and as long as punters love thl I’ll be there ...but in spite what the likes of hardt say pretty hard to make up a DCF or even a ddm to support an enterprise value closing in on a billion dollars
But as we know these days sentiment rules supreme these days eh
Last edited by winner69; 18-02-2018 at 04:10 PM.
“ At the top of every bubble, everyone is convinced it's not yet a bubble.”
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18-02-2018, 04:50 PM
#2393
Originally Posted by winner69
Leftfield ..I did not say thl share price might not go anywhere for a year or so.
All I did was put up a chart that told a story any one you wanted ....and mentioned that one of those stories could be beagles view that it might not go anywhere.
Chart looks even better and I’m happy with that. My holding is dependent on market sentiment and as long as punters love thl I’ll be there ...but in spite what the likes of hardt say pretty hard to make up a DCF or even a ddm to support an enterprise value close to a billion dollars
But as we know these days sentiment rules supreme these days eh
Well given the capital intensity of the industry I agree with you that DCF wont support valuations.
Originally Posted by hardt
#2063 Valuing growth companies using DCF is easily distorted as many have capex intensive growth schemes in place to drive earnings growth over short-medium term that level out once the maturity curve is being reached.
Valuing this one using earnings growth estimates of 44-52 NZDm in 2020 ( 17-19%CAGR )
This presents a PEG of 0.90 at current SP - rather cheap growth and it comes with a 4.2% net yield that will grow more or less inline with earnings.
Anything under $6 seems like a fair price to pay in my opinion...
DCF is great for mature businesses with single digit organic growth... which THL is not.
Valuing the growth over anything else... what else can you expect in this market?
As said before, if THL is overvalued so is the entire industry. ( which might be the case then )
Last edited by hardt; 18-02-2018 at 04:53 PM.
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18-02-2018, 05:05 PM
#2394
Originally Posted by hardt
Well given the capital intensity of the industry I agree with you that DCF wont support valuations.
DCF is great for mature businesses with single digit organic growth... which THL is not.
Valuing the growth over anything else... what else can you expect in this market?
As said before, if THL is overvalued so is the entire industry. ( which might be the case then )
hardt ... Have you updated your ddm model from a few months ago/
“ At the top of every bubble, everyone is convinced it's not yet a bubble.”
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18-02-2018, 05:19 PM
#2395
Originally Posted by winner69
hardt ... Have you updated your ddm model from a few months ago/
I can't even remember having done a DDM on THL...
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18-02-2018, 08:21 PM
#2396
Originally Posted by winner69
Leftfield ..I did not say thl share price might not go anywhere for a year or so.
All I did was put up a chart that told a story any one you wanted ....and mentioned that one of those stories could be beagles view that it might not go anywhere.
Chart looks even better and I’m happy with that. My holding is dependent on market sentiment and as long as punters love thl I’ll be there ...but in spite what the likes of hardt say pretty hard to make up a DCF or even a ddm to support an enterprise value closing in on a billion dollars
But as we know these days sentiment rules supreme these days eh
Thanks for the clarification Winner, and good to see you have not given up on THL entirely.
Here's another chart to contemplate, it compares the last 5 years SP of THL v HLG (a current market darling.) I suggest THL's 750% better performance over 5 years - is not only about 'sentiment.'
Attachment 9515
Will THL's performance continue? Who knows, but the odds are pretty good IMHO and we will get further clues this week.
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18-02-2018, 08:42 PM
#2397
Originally Posted by hardt
Valuing the growth over anything else... what else can you expect in this market?
As said before, if THL is overvalued so is the entire industry. ( which might be the case then )
The 'growth' stories that are doing so well for so long all seem to be overpriced, which is fine while the bull lasts, but they are also the first to revert, usually strongly, with a change in overall market sentiment. Leftfield's chart is telling somewhat, but maybe not a good comparison showing a cyclical earner that has range-traded in a fairly wide band for many years, versus a true growth story.
Nevertheless, it's all good until it isn't. The trick seems to be quickly identifying when the good is over and quitting the story, banking the profits and / or recycling into defensive earners. Clearly that's not the time right now with THL, but being alert to overall market and sector sentiment seems prudent, along with a hair trigger when it turns to custard.
BAA
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19-02-2018, 05:58 AM
#2398
Originally Posted by Left field
Thanks for the clarification Winner, and good to see you have not given up on THL entirely.
Here's another chart to contemplate, it compares the last 5 years SP of THL v HLG (a current market darling.) I suggest THL's 750% better performance over 5 years - is not only about 'sentiment.'
Attachment 9515
Will THL's performance continue? Who knows, but the odds are pretty good IMHO and we will get further clues this week.
Very nice chart eh leftie ...gives me the warm fuzzies too
What it doesn’t show is profits ....Like thl were a lossmaking dog at the start of that chart and is now making $30m odd from favourable conditions and a lot by acquisitions whereas Hlg haven’t been making that much more although this year is going to a boomer and they’ll probably make more than thl.
Is sentiment is measured by P/E ratios than thl is twice as popular with the punters now whereas hlg isn’t that much more popular ...even though you call it a market darling
Amazing what you can do with charts eh .
At the moment both thl and hlg good stocks to hold ....as long as sentiment remains favourable ...but keep on eye on those charts.
“ At the top of every bubble, everyone is convinced it's not yet a bubble.”
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19-02-2018, 06:04 AM
#2399
Originally Posted by hardt
Well given the capital intensity of the industry I agree with you that DCF wont support valuations.
DCF is great for mature businesses with single digit organic growth... which THL is not.
Valuing the growth over anything else... what else can you expect in this market?
As said before, if THL is overvalued so is the entire industry. ( which might be the case then )
I think we need to agree to disagree
Thl growth mainly coming from acquisition .... so what’s wrong with doing dcfs on each of the components to get a whole. Each component is essentially a capital intensive mature business in its own right.
“ At the top of every bubble, everyone is convinced it's not yet a bubble.”
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19-02-2018, 08:34 AM
#2400
Originally Posted by winner69
I think we need to agree to disagree
Thl growth mainly coming from acquisition .... so what’s wrong with doing dcfs on each of the components to get a whole. Each component is essentially a capital intensive mature business in its own right.
Always good to have a counter-view to test one's conviction and assessment of a stock, W69.
THL under Rob Campbell and the new managers is delivering and that certainly accounts for some of the premium in this outstanding NZ story.
One more big move this year I would say - and if it happens, stock will be at least $8.
Famous last words?
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