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30-07-2013, 06:42 PM
#121
Member
SP has been sitting around the 1.60-1.70 mark for a while now, has the market priced this as low as it's going to go? Pick up in building consents in the news today led by Auckland and Chch. With full year results released within the month, and earnings already expected to be at the lower end of guidance, is now the time to buy? Cav have cut the fat off their operation in the last few years so who margins are expected to improve. Slow Australian recovery is a risk, but is this already priced in?
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30-07-2013, 07:02 PM
#122
Originally Posted by muss1
SP has been sitting around the 1.60-1.70 mark for a while now, has the market priced this as low as it's going to go? Pick up in building consents in the news today led by Auckland and Chch. With full year results released within the month, and earnings already expected to be at the lower end of guidance, is now the time to buy? Cav have cut the fat off their operation in the last few years so who margins are expected to improve. Slow Australian recovery is a risk, but is this already priced in?
Slow Australian recovery?
They haven't been really in recovery, their economy has taken a hit due to the mining sector, but its not like they are in recession. However, a large chunk of Australian's economy does depend on the mining sector so who knows where it would be heading in the next 12 months. Could recover in no time, or could go down even more...
So, does cavalier depend on the Australian economy?
Disc : Has been on my watchlist for awhile now...
Last edited by baller18; 30-07-2013 at 07:04 PM.
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30-07-2013, 07:35 PM
#123
I fear CAV will be on your wish list for some time baller ...so long that you may forget all about it
Great brand, great product but the money is in their premium carpet -the expensive end of the market
This end of the market is not growing, probably shrinking. Just too expensive for most punters who in the main go for cheaper stuff that does the job just as well. Synthetics taking larger chunk of market over the natural products like wool.
Will maintain their volumes in residential but no huge growth for them in this segment methinks, even globally. Still some demand in commercial space but the real lucrative contracts are few and far between
Somehow they need to reinvent themselves but they are finding that hard to do. The world has changes but CAV hasn't.
This thread has some interesting posts in the earlier days that support this view
Lizard says pretty fully priced with not enough room for the inherent risks involved. I agree with her. The market still having an optimistic view of future prospects
Seeing you into long term investments maybe CAV not for you
Last edited by winner69; 30-07-2013 at 07:36 PM.
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31-07-2013, 09:56 AM
#124
Yes definitely doesn't look like a long term holder right now, if it drops to $1.20 - $1.40 maybe??
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01-08-2013, 10:33 PM
#125
Member
I don't disagree with your points winner, but this is obviously a cyclical company and we are at the beginning of another cycle. They have trimmed the fat off their operation to get through the recent tough times. The pick up in building consents will impact the premium carpet market also. Even if we aren't expecting them to be as profitable as they once were there is still a lot of room for the SP to climb with modest growth.
As for the Australian market, this accounts for half of the companies revenue which is obviously a downside. Just need those Aussies to catch up. As for company performance - I see the expected pick up in the NZ market to kick the recovery of CAV off enough to warrant buying at current levels
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01-08-2013, 11:41 PM
#126
It just struck me too.. if the Australian market accounts for half of the revenue... will this be impacted adversely by the recent slump in the value of the Australian dollar? Or or most of the costs associated with these revenues also denominated in AUD and therefore only the bottom line that is affected?
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02-08-2013, 12:46 AM
#127
Member
Originally Posted by blackcap
It just struck me too.. if the Australian market accounts for half of the revenue... will this be impacted adversely by the recent slump in the value of the Australian dollar?
They did well in 2011 when AUD was peaking, so the current AUD plummet is surely not good for CAV.
Another headwind is that wool prices seem to be creeping up again:
http://www.interest.co.nz/Charts/Rural/wool-prices
Third and fourth warning signs are that the share price is trending downwards and lacks bid support.
I'm watching from the sidelines for now...
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06-08-2013, 04:01 PM
#128
Originally Posted by bulltrap
They did well in 2011 when AUD was peaking, so the current AUD plummet is surely not good for CAV.
Another headwind is that wool prices seem to be creeping up again:
http://www.interest.co.nz/Charts/Rural/wool-prices
Third and fourth warning signs are that the share price is trending downwards and lacks bid support.
I'm watching from the sidelines for now...
So CAV going below 150 is your fault
Still can see 120 odd here
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06-08-2013, 04:24 PM
#129
Originally Posted by winner69
So CAV going below 150 is your fault
Still can see 120 odd here
Wow your preiction might come sooner than we all expected, you could see 1.25 soon. Only one buyer lined up at $1.4 and only with a 2000 lot order
Last edited by baller18; 06-08-2013 at 04:25 PM.
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06-08-2013, 04:44 PM
#130
yup being real careful with falling knives, especially with first hand experience with DIL...
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