MET - Metlifecare - one for the fundies?

[dobby41]

If you take a 3 year perspective there's a lot of disappointed people who bought a house / land in Auckland 3 years ago and I think therein lies the explanation.
The outlook is much better and also the development outlook of MET and that's probably what has stirred interest in this proposed takeover.
Every other stock in the sector is now trading on a minimum of a 25% premium to NTA so private equity are getting a great deal if this goes for $7.25 which virtually no premium to NTA at all. I think you are right, the board and Sowry could have been a lot more proactive and as mentioned recently the buy-back was too little, too late.

Easy enough to find SUM value elsewhere in the sector as a substitute for capital invested here.

So the outlook for the company is very rosy.
Someone sees value is buying it up (we know that they aren't always right, especially if it turns out to be some private equity outfit) - why don't NZ shareholders see the value?
Why do we always sell for the quick gain rather than look at the big, long picture?
Not a lot of hope, really, for the NZ sharemarket in general,

[Balance]

So the outlook for the company is very rosy.
Someone sees value is buying it up (we know that they aren't always right, especially if it turns out to be some private equity outfit) - why don't NZ shareholders see the value?
Why do we always sell for the quick gain rather than look at the big, long picture?
Not a lot of hope, really, for the NZ sharemarket in general,

Comes down to where the funds released from takeovers are deployed.

NZ is a small market with limited sector diversification so international diversification is desirable and appropriate.

Too much of jumping on the bandwagon type investing in NZ - so need to be careful out there.

Examples in recent times where directors should have negotiated and accepted takeover offers (in part or in whole) :

THL
CVT
STU
FBU

Not all cheese and crackers out there.

[Bjauck]

Comes down to where the funds released from takeovers are deployed.

NZ is a small market with limited sector diversification so international diversification is desirable and appropriate.

Too much of jumping on the bandwagon type investing in NZ - so need to be careful out there.

Examples in recent times where directors should have negotiated and accepted takeover offers (in part or in whole) :

THL
CVT
STU
FBU

Not all cheese and crackers out there.

Yep NZX listed options are getting thin on the ground? So I am guessing some proceeds may be reinvested in other listed Retireent stocks but much of the proceeds will end up in the good old Kiwi favourite - unlisted NZ residential real estate.

[Beagle]

Yep NZX listed options are getting thin on the ground? So I am guessing some proceeds may be reinvested in other listed Retireent stocks but much of the proceeds will end up in the good old Kiwi favourite - unlisted NZ residential real estate.

I don't think so. Government are making it exceptionally tough for residential rental property investors. I think there's a lot of rental property investors looking for the exit door and where will that money go ? REIT's and retirement companies because those sort of people are comfortable with property as an investment class but not at all comfortable with the current political environment where tenants rights are front and central to Govt policy. You can get a good feel for how property investors are currently thinking in this thread https://www.sharetrader.co.nz/showth...070#post782070

[King1212]

Yup .. couple of my mate sold their rentals..to much red tape and low return...too much work too...now they are in commercial.. returning 6 to 7 present...no works at all...

[Bjauck]

I don't think so. Government are making it exceptionally tough for residential rental property investors. I think there's a lot of rental property investors looking for the exit door and where will that money go ? REIT's and retirement companies because those sort of people are comfortable with property as an investment class but not at all comfortable with the current political environment where tenants rights are front and central to Govt policy. You can get a good feel for how property investors are currently thinking in this thread https://www.sharetrader.co.nz/showth...070#post782070

Maybe "much of the proceeds" is an overstatement but my guess is that a significant percentage from the takeover will end up in residential real estate.

The government are making it tougher for landlord investors. Although it could be said that it is trying to bring the residential rental market to a standard fit for the 21st Century. Investors still don't need to pay a stamp duty when buying an investment property, unlike Australia and other countries.

Unlike Australia, the NZ share market is small for the size of our population, and fixed interest yields are low. I would suggest that every takeover or loss of an NZX listing results in a diminished share of household assets remaining invested in sharemarket listings with investor residential real estate being a net beneficiary.

I guess it remains to be seen whether the current government's rental and tax changes will make a dent in the long term trend.

Disc: MET shareholder and I would have liked to continue to be a long term holder. I invested in the Retirement Property stocks rather that have the hassle of being a landlord.

[RTM]

I don't think so. Government are making it exceptionally tough for residential rental property investors. I think there's a lot of rental property investors looking for the exit door and where will that money go ? REIT's and retirement companies because those sort of people are comfortable with property as an investment class but not at all comfortable with the current political environment where tenants rights are front and central to Govt policy. You can get a good feel for how property investors are currently thinking in this thread https://www.sharetrader.co.nz/showth...070#post782070

Yep, I reckon you’re on the money. My sister and brother in law just sold all their rentals....5 I think.... Milford are now investing the proceeds for them. They had mostly newer houses, so weren’t faced with insulation issues. But it just seemed to be getting harder and they could do without the hassle.

[dln]

Who did they sell them to?
Other investors? Owner occupiers?

[Beagle]

Just in the 12 months alone, subsequent to the insulation requirements which has been a MASSIVE multi thousand dollar drama for many landlords we have had a new law ringfencing tax losses from rentals so you can no longer offset those against other income and major new legislation is pending, (discussed in detail in that other thread) giving tenants a whole new suite of rights and major moves to disempower the real owner of the property. This comes on the back of the change to depreciation a few years ago so that people can no longer claim building depreciation.

The legislative framework is such that landlords are entitled to feel that their rights as owners are being very forcefully undermined. With the widespread proliferation of methamphetamines' and damage to property from either gross recklessness or deliberate retribution from disenfranchised tenants and a Government hell bent on a major shift in the balance of power dramatically in favour of the tenant, its now got so tough I can completely understand why people are getting out.

Anyway..back to MET. Where am I going to reinvest proceeds of the MET takeover ? Have started already with SUM and haven't finished yet.
HGH also a safe long term bet and good value and is likewise in a nice uptrend so technically it looks just as good as the fundamentals.
I like investing in good solid companies on compelling fundamentals that are in a nice rising uptrend...much easier swimming with the tide than against it, so to speak.

[tim23]

Just so long overdue changes really, hard to argue with any of these measures...

Just in the 12 months alone, subsequent to the insulation requirements which has been a MASSIVE multi thousand dollar drama for many landlords we have had a new law ringfencing tax losses from rentals so you can no longer offset those against other income and major new legislation is pending, (discussed in detail in that other thread) giving tenants a whole new suite of rights and major moves to disempower the real owner of the property. This comes on the back of the change to depreciation a few years ago so that people can no longer claim building depreciation.