MET - Metlifecare - one for the fundies?

[Beagle]

It is all fun and games on here. Everybody thinks they’re right and that’s what Makes this site so interesting. Couta1 loves his milk And beagle loves the old folks. Unfortunately no one has a crystal ball. You could do some diversification and get a bit of both or do something else completely Like SKO. Beagle does give some very good analysis, so trying to understand it and I look up what I don’t understand. It’s a bit difficult to understand what is tongue in cheek, between what is researched, I take it with a pinch of salt and do lots of lots of research Make notes, so you remember what you decided what you did, and then go for it . When the MAs are one above the other, then that might be a nice indicator.
Beagle ,Winner 69, Balance, Couta1 and all the rest of you, Thank you for another entertaining and educational year and for all your help and support and sharing your wisdom and humour, let’s hope we all have a good 2020 vision for next year

Thanks Yoda. People have to live somewhere, they don't have to drink A2 Milk. 37% compound average growth rate for the last 5 years is quite SUM achievement and only trading on a forward PE for 2020 of about 15-16. No other stock on the NZX is trading on proven metrics that compelling and a PEG of just 0.4

I think there's going to be a decent dividend for then half year earnings to 31 December 2019 on top of the $7...at least that is my expectation that the board would have thought of who is entitled to earnings for the last 6 months, i.e. current shareholders. Hopefully this dividend will be based on IFRS profits, (i.e. all inclusive profit inclusive of property value gains since 30 June 2019). Provided that's the case I am inclined to accept and move on.

A lot of money will stay in this retirement sector which is why the rest of it is on fire.

[couta1]

Thanks Yoda. People have to live somewhere, they don't have to drink A2 Milk. 37% compound average growth rate for the last 5 years is quite SUM achievement and only trading on a forward PE for 2020 of about 15-16. No other stock on the NZX is trading on proven metrics that compelling and a PEG of just 0.4

I think there's going to be a decent dividend for then half year earnings to 31 December 2019 on top of the $7...at least that is my expectation that the board would have thought of who is entitled to earnings for the last 6 months, i.e. current shareholders. Hopefully this dividend will be based on IFRS profits, (i.e. all inclusive profit inclusive of property value gains since 30 June 2019). Provided that's the case I am inclined to accept and move on.

A lot of money will stay in this retirement sector which is why the rest of it is on fire.

Lol Beagle you are becoming Sumwhat incorrigible, time for you to pour yourself a large glass of A2 and Canterbury cream.

[winner69]

Wonder if what we see next week will be ‘this is it’ unless we get a superior offer

The MET Directors must be feeling a bit sheepish and somewhat embarrassed accepting book value for a retirement company with has had huge growth and has a superb development pipeline at a time property prices are starting to boom again (that no doubt is why they mentioned 8 bucks plus)

[Joshuatree]

Often management are given a sweetheart deal, financial rewards to accept such offers , if so no embarrassment and every justification they can come up with.

[Beagle]

Agreed, the reports on this deal are going to make for a very interesting read and I am a bit underwhelmed at $7, would have been more satisfied at $7.25.
$7 is ostensibly NTA as at 30 June 2019...so if existing shareholders don't get the full profits since then including gains in the property value (IFRS profits for the last 6 months) by way of a special dividend I will want a very fulsome explanation as to why this offer should be considered to be fair and reasonable.

Worth noting that every other listed retirement company is now trading at a minimum premium to NTA of 30%.

[carrom74]

https://www.reuters.com/article/us-m...-idUSKBN1YU18Z

Interesting paragraph in the report which reads as (does it mean there is a lot more work to be done or MET hasn't agreed to the offer...?? or may be the other two offers are also being looked at --albeit with SIA)
In NZXR’s Friday announcement, it did not specify whether the buyer offering NZ$7 per share was the one Metlifecare had been negotiating with.

[macduffy]

Often management are given a sweetheart deal, financial rewards to accept such offers , if so no embarrassment and every justification they can come up with.

I doubt that we'll ever be told, but it would be interesting to know what, if any, "golden parachutes" blossom on a change of ownership or control.

[winner69]

I doubt that we'll ever be told, but it would be interesting to know what, if any, "golden parachutes" blossom on a change of ownership or control.

Glen Sowry needs to do OK ...might find it hard getting another job like he has with MET

[Beagle]

I think we are in for an interesting time ahead with this one. Looking at where the rest of the sector was priced, (even before the first noises of a takeover of MET), nobody can make the case that $7 is a compelling price given the better prospects for Auckland real estate and the companies own enhanced development pipeline. Really, it is the absolute minimum possible price anyone could recommend, with a straight face.

Lets not forget that there are three interested parties and there could well be a competitive bidding situation.

I think Glen Sowry could have done a lot better to appraise the market of the prospects for 2020 to keep the market better informed and I for one will be looking for a very clear report on the current state of the business before making any decision to sell my shares.

[peat]

An axiom stated earlier on these forums is 'the first bid is never the last' , even though this $7 bid is not the first , it kind of is because 6.50 was the lowball offer never even considered.