Ebos Limited EBO

[kiwidollabill]

Not much banter on this one recently, seems to equilbrate around the $10 mark over the last 2 years. I would consider myself a buyer but the shift in the forex is going to hit their profit margins heavily. Expecting some profit downgrades which should push things down into a good buying position. See this as a good long term hold but will give it 3-6 months before diving back in.

[percy]

With the majority of earnings coming from Australia,the weakening NZ$ will greatly improve EBO's profit.

[macduffy]

[QU.OTE=kiwidollabill;580076]Not much banter on this one recently, seems to equilbrate around the $10 mark over the last 2 years. I would consider myself a buyer but the shift in the forex is going to hit their profit margins heavily. Expecting some profit downgrades which should push things down into a good buying position. See this as a good long term hold but will give it 3-6 months before diving back in.[/QUOTE]

You're probably on the mark there, bill. The exposure to the AUD was seen as a potential benefit or drag on profitability at the time of the big move into Aust with AUD earnings now around 80% of total. I'm a longterm holder since the Early Bros days so not fussed about short term fluctuations. Wouldn't be trading it at this point though and will wait before considering adding any.

[noodles]

Not much banter on this one recently, seems to equilbrate around the $10 mark over the last 2 years. I would consider myself a buyer but the shift in the forex is going to hit their profit margins heavily. Expecting some profit downgrades which should push things down into a good buying position. See this as a good long term hold but will give it 3-6 months before diving back in.

Really? Have you seen how far we have dropped against the aussie. We started the financial year (1/7/14) at 92.8c. As of 30/6/15, NZD traded at 89c. And we a lower now.

I see EBO as a medium growth stock that is non-cyclical. It is on very undemanding pe multiples compared to other stocks on the NZX. It could be just the tonic for a portfolio overly-focused on the NZ economy.

[percy]

Really? Have you seen how far we have dropped against the aussie. We started the financial year (1/7/14) at 92.8c. As of 30/6/15, NZD traded at 89c. And we a lower now.

I see EBO as a medium growth stock that is non-cyclical. It is on very undemanding pe multiples compared to other stocks on the NZX. It could be just the tonic for a portfolio overly-focused on the NZ economy.

Disclosure.
I am full of tonic........
Well holding a lot of tonic.
In fact I am "well positioned." lol.

[kiwidollabill]

I was more concerned about the buy side, alot will be from US suppliers or bought in USD

[dagoldtoof]

The fact Ebo are involved in Masterpet gives me a good feeling....The pet aisle takes up a lot of increasing area in the foodmarts....and we all love our pets...

[macduffy]

I was more concerned about the buy side, alot will be from US suppliers or bought in USD

Fair point, bill.

EBO "may hedge a portion of its net currency exposure to manage the risk around both revenue and expenses " - from the offer document re the Symbion acquisition. Of course, hedging can work both ways - enhancing profitability or hedging profits away! Let's hope that they have some good operators on the job.

A lot of their business is in price-regulated areas such as supplying Pharmac, DHB's etc. Anyone know if such price regulation allows price increases to maintain profit margins?

[kiwidollabill]

Fair point, bill.

EBO "may hedge a portion of its net currency exposure to manage the risk around both revenue and expenses " - from the offer document re the Symbion acquisition. Of course, hedging can work both ways - enhancing profitability or hedging profits away! Let's hope that they have some good operators on the job.

A lot of their business is in price-regulated areas such as supplying Pharmac, DHB's etc. Anyone know if such price regulation allows price increases to maintain profit margins?

The 'All of Government' tenders which have been rolled over the last few years (or at least the ones I've seen) don't give a rats arse about the exchange rate, prices must be fixed in NZD.

[percy]

Just checked EBO chart.
Hard to decide whether I am "well positioned" to still just "positioned".
Will it break out this time.?
And will the break out be up,or down.?
The result is due end of August.