THL - Tourism Holdings

[couta1]

I may be wrong but I still believe this is a good long term hold with a good divie. I am mildly tempted to buy a few more at these levels although I agree it may go down even further in the short term

I reckon you're got the situation pretty well sussed out there young bear.

[Justin]

SP stop dropping today

[iceman]

Someone keen to pick these up with 50000 shares bid at 5.71

[BlackPeter]

Someone keen to pick these up with 50000 shares bid at 5.71

trying to catch dropping knifes is dangerous .... but it looks like somebody did.

GLTAH!

[golden city]

Possible the one trying to catch fallen kneife is a Kong fu master citic China haha

[iceman]

trying to catch dropping knifes is dangerous .... but it looks like somebody did.

GLTAH!

THL a green arrow in a sea of red on the NZX today.
Here is one more recognition for this great company https://www.nzherald.co.nz/business/...ectid=12120371

[BlackPeter]

THL a green arrow in a sea of red on the NZX today.
Here is one more recognition for this great company https://www.nzherald.co.nz/business/...ectid=12120371

True - nice upwards move, but still below the MA200 - actually just touching it.

Don't misunderstand me - THL is a well run company which delivered great returns for its shareholders. If we assume it keeps growing as in the past five years with an EPS CAGR of above 25%, than it is definitely still undervalued.

Question is just - how likely is this? Much easier to grow the earnings from 4 cts (in 2013) to roughly 40 cts / share within 5 years than doing this exercise again - or does anybody seriously expect $4 EPS in 2023?

What I am saying is - growth is guaranteed to slow down and in this case a backward PE of 57 and a forward PE of 16 (based on 4-traders forecasts) does not look that flash anymore. From a fundamental perspective it looks fully valued to me - and while I expect them to do well over years to come - from a fundamental perspective do I think that the downward risks look at this stage more significant than the potential upward gains.

What are the risks I see?

• tourism is correlated with people having spare money. Money might sit a bit tighter when the current bull run ends ...
• all the usual suspects impacting on tourism including a wave of anti-tourist publicity in New Zealand impacting on the "feel-good" factor for tourists.
• its a cyclical business and it had a good run.
• part of their business is selling these newish campervans at an for them still acceptable price. At some stage however the market for pre-loved camper vans will reach saturation - I guess, how many of them does one need to stand around in ones driveway? From a personal observation - more and more campervans are now cluttering the landscape in our neighbourhood, but (at least I hope) it sort of feels we reached saturation level. LOL.
• new strategy (TH2) is interesting, but unproven. Are the risks factored in into the SP?

Having said that - the market is short term not driven by fundamentals, i.e. nobody can predict based on the fundamentals how the SP will develop short and midterm. If might push up today or it might bounce back at the MA200. If it manages to push back through the MA200 and stick there, it well might go back into an uptrend.

Still not sure how much future potential people would see for the share price given its current lofty heights ...

[winner69]

BP - good post

Most of thl’s recent growth has come from acquisitions .....and further acquisitions are needed if share price is to keep rising

That’s how I see it anyway

[RTM]

BP - good post

Most of thl’s recent growth has come from acquisitions .....and further acquisitions are needed if share price is to keep rising

That’s how I see it anyway

Yes....great summary. I guess a positive for them is that there is a steadily increasing number of folk reaching retirement age who will rent one of their vans for a holiday or holidays once they sell the family home and move to the provinces. Or secure a loan from HBL.

The TH2 initiative concerns me quite a bit. Maybe because I don't fully understand it. IT projects can easily go wrong and consume a lot more money than budgeted. And will it deliver what they think it will ? I am really in the hands of the company management here as as noted above....I don't fully understand how it will be used to generate a big return. Buying a Camper Van, renting it, selling it...I can understand that. But this is another step. Lets suppose / hope that the idea is sound and great ...as someone noted...it turns them into a tech company. Do they have the expertise ?


Wee bit concerned, and yes, I do hold.

[iceman]

BP - good post

Most of thl’s recent growth has come from acquisitions .....and further acquisitions are needed if share price is to keep rising

That’s how I see it anyway

Agree it was a good post from BP. The risks he outlines are real but some not particularly high risk at present, in my view.

I expect an acquisition announcement soon-ish to continue growing the business apace.