RYM - Ryman Healthcare

[Vaygor1]

If I had 1 RYM share in 2007... what would the compound divi and share split etc value my stock at today?... purchase price... $2.30

11 years down the track...

I bought a few parcels of RYM between late Sept 2007 and late Nov 2007.
There have been no share splits between then and now.

Average Price paid was $2.103 per share.
Pre-tax Dividend income (for all of them) from purchase until now adds up to $1.213 per share
By this time next year, this dividend income will total over $1.45 per share I believe.

My best buy was in November 2008.
Average price paid $1.38 per share
Pre-tax Dividend income since purchase adds up to $1.164 per share
By this time next year dividend income will total over $1.40 per share. i.e.. These ones will have paid for themselves entirely by gross-dividend distribution in 11 years (carrying costs ignored).

Dividends paid since record date of 7-Dec-2007 for RYM in cents/share (with the last two dividends as a (conservative?) forecast:

Screen Shot 2018-09-18 at 9.25.52 PM.jpg

Screen Shot 2018-09-18 at 9.26.23 PM.jpg

Screen Shot 2018-09-18 at 9.28.57 PM.jpg

[Food4Thought]

I bought a few parcels of RYM between late Sept 2007 and late Nov 2007.
There have been no share splits between then and now.

Average Price paid was $2.103 per share.
Pre-tax Dividend income (for all of them) from purchase until now adds up to $1.213 per share
By this time next year, this dividend income will total over $1.45 per share I believe.

My best buy was in November 2008.
Average price paid $1.38 per share
Pre-tax Dividend income since purchase adds up to $1.164 per share
By this time next year dividend income will total over $1.40 per share. i.e.. These ones will have paid for themselves entirely by gross-dividend distribution in 11 years (carrying costs ignored).

Dividends paid since record date of 7-Dec-2007 for RYM in cents/share (with the last two dividends as a (conservative?) forecast:

Screen Shot 2018-09-18 at 9.25.52 PM.jpg

Screen Shot 2018-09-18 at 9.26.23 PM.jpg

Screen Shot 2018-09-18 at 9.28.57 PM.jpg

Thank you for your quality reply Vaygor1. You have done very well with this and the share return. I can imagine your comfortable position now.

It gives me some more clarification on to potential for RYM and Co.
Sincerely appreciate your response.

I also appreciate your response Winner69. You made me laugh, you cheaky :P

[Beagle]

Well done Vaygor1. OCA shareholders take note while their metrics are still cheap as chips. Just hold for a decade and let compound growth and PE expansion work its magic. SUM other companies also are well on their way to generating massive gains for long term shareholders.

[Baa_Baa]

I bought a few parcels of RYM between late Sept 2007 [snip]
My best buy was in November 2008.
Average price paid $1.38 per share

Better than well done! Casual observers may not have connected the dots that you were buying the whole down-trend phase of the NZX during the GFC!

Remarkable conviction and courage.

[Patient Panda]

Yes extremely well done and more than that Vaygor I’m very grateful to you and a few others who taught me a lot about RYM back around when I first bought in a bit over 6 years ago.

[Vaygor1]

Wow. Thank you all for your kind words.

You are correct BaaBaa. It was an extremely nerve-racking time hanging onto RYM through the GFC. After all those RYM buys in 2007 at circa $2.10 (and borrowing money to do it at interest rates higher than they are today), over a year later by Nov 2008 those 2007 share purchases were only worth $1.38 on paper.... a 35% loss and trading at very low volumes... with interest accumulating on my borrowings.

After that, the price dropped even further to a low of $1.20... a 42% loss. It really was a testing time, and fear nearly took over at that point, but thankfully I managed to hang in there.

Thinking back, I in turn took heed of comments early on from posters like SparkyTheClown, Sauce, Paper Tiger, KW, Noodles amongst others, who helped steer me in the right direction. Later on, robust discussion with Winner, Beagle, Hoop et al also helped me think about whether or not I was being too bullish on occasions about RYM.. I was... so you really have them all to thank too Patient Panda.

I am under no illusion that for the foreseeable future, RYM (along with others in the sector) will continue to grow in just the same manner as it has over the last 11 years so long as their build rate continues to grow. Wth RYM's dividend growth, purchases like those in 2008 have an effective gross divided yield averaging over 8%/annum over a 10 year period.. and then still continue to grow.

Given the above, I can say I do buy RYM for the dividends.. patience is the key.

For those curious, RYM's dividends pre-December 2007 were as follows:

Screen Shot 2018-09-20 at 6.59.51 AM.jpg

Vaygor

[Beagle]

I used to enjoy those robust discussions. Now to a point I accept that RYM deserves a premium for their unrivalled consistent growth in the sector however I am not the only one by any means who thinks they're overpriced at present.

Attended a very interesting presentation by Earl Gasparich CEO of OCA at last nights NZ shareholders association meeting. In question time one person asked him which share he would buy in the sector other than OCA and which he would sell. He went on to say in no uncertain terms that he thinks RYM is very fully priced for all the reasons I have espoused on this thread.

Interestingly, the one he would buy other than OCA was MET. He reckoned trading under NTA and starting to build in their development capabilities its possibly the best value pick. It has been for quite some time though and I think the weathertightness issues they have with some of their villages will be a rat hole that's got a lot more wood rot than what's apparent at face value.

Probably much better to buy a company with a great care reputation, close to NTA, trading on well under half RYM's metrics eh Probably only need to wait 3-4 years to get one's 8% dividend yield

[Patient Panda]

Perhaps a matter of semantics Beagle but calling it overpriced is a stretch by any imagination. Not good value buying - sure. Over valued would be >15.25 imo.

[Beagle]

FWIW my buy price is $11.28...I start to lose interest at a fairly quick rate of knots going north from there. I am not alone. Professional analysts have a consensus similar view with an average 12 months hence target price of just $10.77 which suggests net present value right now of just under $10 !...so yes I think the term overpriced is appropriate but feel free to use whatever term you like mate The market in my opinion is paying a crazy price premium for predictable growth at present which could lead to years of future relative sector underperformance for anyone paying the current price https://www.marketscreener.com/RYMAN...072/consensus/

While many of us admire Vaygor1's tenacity with buying during the GFC and holding for so long and reaping massive rewards that doesn't mean RYM at the current price will give the same rewards going forward. I prefer to look at what smart investors like him have done and ask myself how are these lessons best applied to shares today so as to give me the best rewards based off the current SP going forward ? That suggests to me that buying OCA at close to one third of the fundamental metrics of RYM and holding that high growth share for a decade or more is the optimum strategy. Remember they churn their care suites every 2.5 - 3 years not every 7 years...what does that suggest for long term capital gains going forward ?

[Patient Panda]

I can’t remember my current exact valuation for RYM off the top of my head but my buy price is very similar to yours in the mid $11 region. For reference my last buys were in Dec 2016 for 8,15 and 8.20.
At todays current price an increase of 62.5% in under 2 years isn’t bad.

The value of predictability is highly underrated by many imo