RYM - Ryman Healthcare

[troyvdh]

Off topic...resource shares in OZ are/have been falling....despite Iron ore prices are maintaining sort of stable.....and it could be argued that the "China" story aint over yet...for at least 15-50 years...yet SP performance is largely negative...????.....illogical.....

In NZ retirement/property shares are booming as is the demand from "the market" ...number of old folk will continue blah blah....logical....me thinks that should RYM MET SUM fall away...then it is illogical....

...but is that not just the "MKT"......

[steve fleming]

A village model with investment appeal


Roger Montgomery22 May 2013


Read more at Eureka Report: http://www.eurekareport.com.au/artic...#ixzz2U55pSzHG

It is estimated that the number of people over the age of 75 will double in Australia over the next 20 years. The “grey market” will fundamentally shape the landscape of the Australian economy. Living for longer, and used to comfort, they will expect to see out their days in the quality of life to which they are accustomed.There are a number of quality Australian health care companies that are perfectly positioned for this growing market. Cochlear is at the forefront of hearing-aid devices, Ramsay Health Care is a leading private hospital operator, and CSL is at the cutting edge of biological advances. But there is one sector in which Australian companies have been unable to successfully achieve scale.Traditionally, retirement villages have been modelled on a typical residential community - a number of units surrounding a communal centre. But practicality and functionality doesn’t address the emotional issues. Age does not change one’s desire for comfort, community or independence.Everyone values their independence. That is why incarceration is punishment – it involves the absence of independence. And everyone values community. For these reasons, as well as a sense of ownership and achievement, people have a deep attachment to their own home.The major step to a retirement village is therefore often borne of need, such as that for additional support.Evidently, and yes I am acutely aware of the fact that I have only vicarious experience here, retirees rank reputation and affordability as the two highest priorities when assessing retirement villages. Developers must also consider ‘high care’ facilities that will cater to the broad needs of residents, and the best should also be able to offer different levels of care to accommodate both partners. Many developers, however, will only address basic needs, as health care costs can quickly grow out of control if not managed effectively.But where Australian retirement villages have lagged, New Zealand retirement villages have forged ahead. Our neighbours have developed a sustainable model that profitably caters to retirees’ needs – both physically and socially. Indeed, there is one New Zealand company that not only leads the way in terms of its services and offering, but it has also produced stellar returns for the past decade. If you can indulge me for a moment, these returns show no signs of fading into the sunset.Ryman Healthcare (RYM.NZ) floated on the New Zealand Stock Exchange in 1999, raising $25 million. Since then, it has invested another $1.1 billion into the business without raising a single cent from investors. What’s more, the company has paid $265 million in dividends over its lifetime – a stunning performance indeed.


Ryman Healthcare understands that residents should not feel forced to move – as such, it has developed a community that fosters a deep level of care throughout every stage of life. Management has been able to leverage this reputation into a business model that produces multiple revenue streams from its residents.Upon entering a village, residents pay an “Occupancy Advance”, which entitles them to reside within a unit. During their residence, Ryman caps the management fees at 20% of the Occupancy Advance to ensure that the residents have certainty with their financial future. The fees are collected when the resident vacates the unit, at which point Ryman generates further returns from reselling the accommodation.But the key to Ryman’s business model is offering the full continuum of care at its villages - from independent living through to assisted living and specialist dementia care. Care fees provide a high margin of return, and are collected on a weekly basis.You may consider that a business that has been operating for three decades would have achieved maturity, but this is far from the case. Ryman Healthcare only has a 10% share of the retirement village market in New Zealand. The number of beds and units is now almost double that built five years ago, and management is aiming to add 700 beds per annum. Part of this strategy is expansion into the Australian market. Management purchased a block of land in Melbourne in 2011, and has plans for the site to be fully operational by early next year.While risks will always be inherent with any overseas expansion, Ryman’s competent management should be able to implement the business model in accordance with targets. With that being, said the current share price, which has nearly doubled in the past 12 months, appears to have accounted for the potential upside of the company’s growth plans.I will be watching this company closely. Ryman appears to be a fantastic company, providing an exceptional standard of care for a growing number of residents – a reputation that will hold it in good stead as its somewhat fragmented Australian competitors develop equally fragmented offerings.

[Beagle]

Thanks Steve. That gives us an insight into how fractured the industry is in Australia and it looks like those investment guys have a big following which might explain yesterdays share price leap.

[winner69]

Updated RYM chart with an Average True Range (ATR) shown, ATR is a robust measure of volatility and is useful is setting stop losses on stocks that steadily increase, with the purpose of capturing most of the gains and not selling too soon after a pull back to see the price rise again. The ATR on this RYM chart is set at 4, a pretty loose setting ideal for something that has increased for so long

Follow this methodology and one wouldn't sell RYM until it falls to 611 ,,,, but then tomorrow the number might be higher. Rememebr it was only 570 odd a few weeks ago

That's my system and I going to stick to it

[Beagle]

Updated RYM chart with an Average True Range (ATR) shown, ATR is a robust measure of volatility and is useful is setting stop losses on stocks that steadily increase, with the purpose of capturing most of the gains and not selling too soon after a pull back to see the price rise again. The ATR on this RYM chart is set at 4, a pretty loose setting ideal for something that has increased for so long

Follow this methodology and one wouldn't sell RYM until it falls to 611 ,,,, but then tomorrow the number might be higher. Rememebr it was only 570 odd a few weeks ago

That's my system and I going to stick to it

Interesting one but I note it would appear from your chart that your system would have given you a sell signal in early March 2013, (price did nothing from 1 January 2013 at $4.60 through to early March whereas a simple 100 day moving average line was nearly (but not quite breeched). In this instance it would appear a simple 100 day moving average, (brown line in this chart) non-breech would have given a better result. Even if one used the 30 day moving average with its tighter implied stops as long as one was waiting for a really clear breech of the 30 day line they could still he holding with a presnt indicative sell if the price dipped to about $6.00.


The analysts with their models can pontificate all they like as to whether this is a buy, accumulate, hold or reduce but until I get some clear technical signals that's contrary to my assessment of it being fiundamentally a good growth stock to own even at today's prices, I won't be selling.

[Vaygor1]

From this morning's Stock Take column in the Herald:

http://www.nzherald.co.nz/business/n...ectid=10885788

I read this article with interest Sparky.
In it they say "We estimate the current price assumes 18 years of future development at the current build rate."

Good grief. The market as a whole is way, way too greedy (and fearful) to even begin to contemplate an 18 year window when deciding on a buy/sell decision today for any stock.

...and why on earth would anyone think that RYM is suddenly going to merely maintain its current build rate from now on (well, for the next 18 years) when every single indiction of what RYM do and what RYM say runs contrary to this? This from a company which has consistently delivered and walked the talk since its inception.

Their current build rate is completion of 2 beds or units every single day of the year.... no reason why they can't lift it to 4 per day and I for one believe that over a relatively short time frame, they will do just that.

[Vaygor1]

You and me both Moosie. However you, me, Sparky, Roger, Sauce and a few others here don't represent the market as a whole..... unless maybe...if our combined shareholding was enough to command the market.............

[Slam dunk]

I read this article with interest Sparky.
In it they say "We estimate the current price assumes 18 years of future development at the current build rate."

Good grief. The market as a whole is way, way too greedy (and fearful) to even begin to contemplate an 18 year window when deciding on a buy/sell decision today for any stock.

...and why on earth would anyone think that RYM is suddenly going to merely maintain its current build rate from now on (well, for the next 18 years) when every single indiction of what RYM do and what RYM say runs contrary to this? This from a company which has consistently delivered and walked the talk since its inception.

Their current build rate is completion of 2 beds or units every single day of the year.... no reason why they can't lift it to 4 per day and I for one believe that over a relatively short time frame, they will do just that.

The company has said themselves they want to replicate their NZ build rate in Aus within 5 years so that's more than 'maintaining' http://www.stuff.co.nz/business/indu...s-on-Melbourne

[Vaygor1]

The company has said themselves they want to replicate their NZ build rate in Aus within 5 years so that's more than 'maintaining' http://www.stuff.co.nz/business/indu...s-on-Melbourne

Correctamundo my man... correctamundo.

And this from the NZ side in RYM's latest announcement "You can expect to see more land acquisitions in the year ahead as we lift our New Zealand landbank from three to four year's stock."
If their NZ build rate continues to accelerate as it has been, their current four years of stock will shrink to three or less. I expect, as such, they will be increasing their land-purchasing rate by a significant margin.

[Beagle]

$7.50-$7.75 is where I see them in 12 months time after confirming good progress in Australia.
I see this stock at $12-$13 in five years time after establishing a good beach-head in Australia.
Have the analysts really factored in the 20 year tailwind this company will enjoy and its stellar management and growth record...I don't think so. When some far less compelling stocks are selling on the N.Z. market for similar price earnings ratio's you've got to wonder a bit. Not cheap at current prices but for some stange reason this old consumer adage spings to mind, "the bitter taste of poor quality lingers long after the thrill of a bargain is forgotten"...you get what you pay for.