RYM - Ryman Healthcare

[Patient Panda]

Solid result... But still, NPAT (the most important indicator?) down - no worries NPAT probably waay down for ARV.

Underlying profit for sure will be at least 2x higher than that dog ARV (it needs to be)

TJ IFRS NPAT only down because accounting standards dictate the melb villages will have had to have had their valuations updated and due to change in valuations over there it skews that figure. Cashflows are all up and RYM profits are always bigger in the 2nd half.

take a look at the other numbers 97% occupancy


Beagle I think your previous buy price you gave of $11.50 was much more astute

[Beagle]

TJ IFRS NPAT only down because accounting standards dictate the melb villages will have had to have had their valuations updated and due to change in valuations over there it skews that figure. Cashflows are all up and RYM profits are always bigger in the 2nd half.

take a look at the other numbers 97% occupancy


Beagle I think your previous buy price you gave of $11.50 was much more astute

Growth has slowed which has had a significant effect on my valuation as has my assumptions about future years growth expectations. Some people had been talking up FY19 as a huge year of growth but alas what we see with the mid point of the forecast is yet another sub 15% year of growth. (approx. 13%). Going forward in the medium term I expect that growth rate to tick down even lower as we wind down off the back of a decade plus of unusually high house price increases. I expect RYM to continue to materially underperform its peer group.

Yes Winner I think its unlikely I will be a shareholder again in the foreseeable future because if it does get down to my buy price it would be because of further deterioration in the fundamental's in which case I would have revised my fair value again. I have a strong preference for OCA's more needs based and defensive business model and their compelling metrics.

[winner69]

I see $21m of the $97m underlying profit came out of Australia

Truly amazing considering the relative sizes of the two businesses

[winner69]

Roger said
Going forward in the medium term I expect that growth rate to tick down even lower as we wind down off the back of a decade plus of unusually high house price increases.

Yep revaluation impacts are diminishing quite fast ....no longer double digit % gains every year

Have you sussed whether there’s a way of assessing how underlying profits might be impacted in 3 to 4 years ...it applies to all in the sector.

[winner69]

Looks like myRyman Care is going great guns

Ryman might become a tech company as well as a property developer.

Good stuff

[Beagle]

Yep revaluation impacts are diminishing quite fast ....no longer double digit % gains every year

Have you sussed whether there’s a way of assessing how underlying profits might be impacted in 3 to 4 years ...it applies to all in the sector.

A lot depends on their business model and churn rate.

[dabsman]

The property market is a cycle. If they add hundreds of units a year there will increased sales and care revenues. Then in time there will be increased resales and revaluations. Imagine they double their units in the next 10 years and then the property market doubles as it does every 10 years... not sure why all the property market talk is even given any airing - zero impact to my long term plans

[Beagle]

Just about down to $11 now, a whopping $3 below where I emphatically called it a SELL recently at $14. Don't forget those on here that were still calling it a strong buy at that level. Another $1 or $2 down from here and it might be worth another sniff.

[Joshuatree]

Good call for your personal strategy but many of us are not trading this top stock but investing longterm ($2.30 entry). The ups and downs are pretty irrelevant unless something really serious undermines the integrity and long term performance.

[Beagle]

Good call for your personal strategy but many of us are not trading this top stock but investing longterm ($2.30 entry). The ups and downs are pretty irrelevant unless something really serious undermines the integrity and long term performance.

A very long term sideways move in real estate, (it has happened before) would see real estate in real terms decline at the inflation rate. RYM's model of 20% DMF and approx. 7 year cycle in this environment would see them earning about 3% per annum on existing assets, less inflation, call it 1% net.

OCA on the other hand by way of comparison charge 10% DMF on their care suites per annum. Such a market would still see OCA doing well. We have the second most expensive real estate in the world on a per capita basis. Most people are interested in looking ahead 10 years and not really interested in the SP ten years ago.
How many times have you read the old investment company disclaimer that seems apt to repeat at this point "Past performance is no guarantee of future performance"
http://www.sharechat.co.nz/article/e...s-down-asbhtml Take care out there folks. A great business may not generate great returns if its already overpriced and future performance is already more than fully baked in.
Take a look at this national house price index contained in the latest REINZ report, see page 4 https://www.reinz.co.nz/Media/Defaul...ber%202018.pdf
Notice how nationally house prices ostensibly moved sideways, (declined in real inflation adjusted terms), between 1996 - 2002 and 2008-2014 ?
Are we due for another 6 year period of declining house prices in real inflation adjusted terms ?