MET - Metlifecare - one for the fundies?

[winner69]

Current share price $4.44 seems about right if no takeover on cards.

Maybe this a way to get a fair expected values target price for year end -

40% chance of takeover at $6.25 (mid point $6.00 to $6.50 - I just love midpoints)
10% chance of market love taking it $5.00
30% chance price hangs around $4.50
20% chance of price falling to $4.00

So all up ‘expected return’ of $5.15 covering all bases

Suppose worth while staying on board and hoping like hell we get $6.50 sooner than later

Updated this after recent events

10% chance of takeover at $6.25 (mid point $6.00 to $6.50 - I just love midpoints)
10% chance of market love taking it $5.00
30% chance price hangs around $4.40
50% chance of price falling to $3.60

‘Expected’ target price in a years time $4.25

BaaBaa mentions opportunity cost ...should be considered as well

Maybe the mantra is now MET, heads you might win, tails you might lose a bit ....hmmm

[winner69]

bull stood alone that metlife would get no where in demanding the takeover , everyone was so bullish pushing the narrative and slowly and surely they are all folding.

These ‘battles’ often end in tears eh bull....esp when parties are so DOGmatic

[Snoopy]

I encourage everyone to read the termination notice from EQT. My initial thoughts are that irrespective of everything else, the wage subsidy application will hold up in court (allowing legal termination of the contract).

Either EQT or the board are in big trouble! Either way, the lawyers are going to be doing well.

Not a MET shareholder and not looking to get in. But from the sidelines this case has eerie parallels with my own investment 'adventure;' into Arrium on the ASX, the scene of my biggest ever sharemarket loss.

Arrium was an iron ore exporter, and financial viability centered on getting production costs down to a certain level as iron ore prices globally reduced. I took the gamble that they would be able to do this.. It was a touch and go situation and I knew what I was getting into, but I judged that the gap between production costs and market price would remain positive. In the end the margin did hold positive However the company was tipped into receivership anyway, because the directors formed a view that was honestly and reasonably held that the company might not be able to keep operating with a positive margin and that if that happened then the company could be trading while insolvent.

Whatever actually happens to MET profits, the fact hat the MET board applied for the wage subsidy indicated that the MET board believed a 30% fall in revenue from pre-covid levels had occurred. The bidders would be quite within their rights to see this as an honestly and reasonably held position -at the time-, regardless of whether the expected falls in revenue actually continued into the future. As it turns out, it looks like the projected fall in revenue of 30% was an over-reaction. But that is irrelevant. As long as the bidder had a view that was honestly and reasonably held at the time, a view conformed by the actions of the MET board applying for the wage subsidy, then the bidders are off the hook as I see it, I am not a legal expert. I am just speaking from a position of being on the receiving end of what I see as an analogous position.

SNOOPY

[Leftfield]

Thanks for posting Snoopy. Like you I've been watching the MET posts from the sidelines.

IMHO it is a very risky proposition to base ones investment on the possibility of a favourable legal outcome.

Whatever the likely outcome, there is a risk that the legal action will be protracted and divert the attention of the Board from other key business decisions.

GLH (Disc don't hold.)

[dreamcatcher]

Lets see where these Retirement stock go

$1.37.............Arvida Group
$6.34.............Summerset Group
$13.35...........Ryman Healthcare
$0.94.............Oceania Healthcare
$4.28.............Metlifecare

[Beagle]

Updated this after recent events

10% chance of takeover at $6.25 (mid point $6.00 to $6.50 - I just love midpoints)
10% chance of market love taking it $5.00
30% chance price hangs around $4.40
50% chance of price falling to $3.60

‘Expected’ target price in a years time $4.25

BaaBaa mentions opportunity cost ...should be considered as well

Maybe the mantra is now MET, heads you might win, tails you might lose a bit ....hmmm

The first version of your probability analysis made a lot more sense to me.

[winner69]

Lets see where these Retirement stock go

$1.37.............Arvida Group
$6.34.............Summerset Group
$13.35...........Ryman Healthcare
$0.94.............Oceania Healthcare
$4.28.............Metlifecare

Probably this way

[winner69]

If I was a resident in a MET village I’d be concerned about having an owner who doesn’t really want to be the owner and maybe just wants to get as much cash as possible out of them ...rather then providing high standards of care/living

[winner69]

Lost in translation

[Beagle]

Back to puppy school for me to learn how to bark more respectfully and at half volume.