GXH - Green Cross Health (formerly PHB - Pharmacybrands)

[flyinglizard]

The problem is the attitude of the management team towards capital market. Ignore the investors, then investors may ignore the company. The market is still ignoring GXH as negative news announced. What will happen if one day GXH tries to issue new shares to perform some large acquirision activities or improve its capital structure.

I noticed that the recent two medical center acquisitions were not announced individually, investors only have those information in the annual or half year reports.
No FY guideline provided
No forecast for COvid 19 between March and July, as other companies did

Clearly GXH does not need attention from capital market and it does not need future capital injection. They only need to slowly make its business strategy change by acquiring 1 medical center every year. They only need organic growth to accumulate operating cash flow, NOPAT or bank loan to complete small acquirision and eventually have 100 medical centers after 50 years.

[Greekwatchdog]

I just sold for a wee lost. Sadly nothings changed and the Pharmacy division is up against it. Good luck to holders.

[Habits]

NO INTERIM DIVIDEND!! Shareholders will be annoyed and disappointed at this. I know i would be but thankfully I sold a month ago to meet a short term payment. Including previous divvies I still made a small loss for the year. The reason I bought in the first place was for the dividend flow.

[BlackPeter]

Well - interesting results and they really work hard to conceal their successes, don't they?

Just looking through the financial:

Revenue - it actually did go up slightly (by 0.6% compared to same period last year) - despite Covid!;

NPAT - anybody noticed that NPAT is up by 24% compared to 1st half of last year ($11m vs $8.88m last year)? I recon they don't want to make too many noises due to the Covid subsidy they received (which they obviously paid to their employees as they had to);

This (Covid sub) explains probably as well the decision re divie, but who knows ... maybe they want to buy another couple of profitable GP practices instead? Would be fine with me.

Quite happy about their profit growth in the Doctors and Community health divisions - this is the future (and lots of ageing population based tailwind).

Sure - pharmacies is something they need to work on ... I recon they would make more money if they stop insisting on taking this stupid $5 prescription fee. This would pretty fast kill off their no frills competitors.

Overall - not unhappy holder - and yes, they could certainly work harder to sell their success instead of concealing it :

[BlackPeter]

Jeez - if I look at the EPS for the half year (6.2 cents with Covid impact), how good will the full year look like?

Say 12 cents EPS (and I think the up-potential for that is clearly larger than the down potential) for a share which one can buy for slightly above $1. Sounds cheap to me ... I might even talk myself into buying some more :

[Habits]

Jeez - if I look at the EPS for the half year (6.2 cents with Covid impact), how good will the full year look like?

Say 12 cents EPS (and I think the up-potential for that is clearly larger than the down potential) for a share which one can buy for slightly above $1. Sounds cheap to me ... I might even talk myself into buying some more :

For real you want to buy more of this non performer?? I encouraged you to buy FBU at 4.20, they are moving up ever since. Give this one a miss and enjoy your zwarte piet celebration 5 December

[BlackPeter]

For real you want to buy more of this non performer?? I encouraged you to buy FBU at 4.20, they are moving up ever since. Give this one a miss and enjoy your zwarte piet celebration 5 December

Nothing wrong with buying an undervalued outperformer rather than an overhyped underperformer :

Just ask yourself - how much lower is the GXH share price to drop assuming they keep or outperform their long term average 11 cent EPS (and it certainly looks that way this year)?

Compare that to FBU. Their long term EPS is 27 cents (i.e. 2.45 x GXH), but their share price is 5.7 times GXH. FBU is in terms of PE more than twice as expensive as GXH, and they are a proven underperformer in boom times.

Sure, it is often amazing what hype can do to a stock price, but I still prefer to buy low and sell dear.

Buying on hype is like surfing ... it can be fun until the wave catches up with you ... and I am not that good in that specific discipline.

Anyway - each to their own.

[nztx]

It's good bye Nurse here too -- better prospects elsewhere until they show signs of wanting to shell out Div's again ..

[lissica]

This (Covid sub) explains probably as well the decision re divie, but who knows ... maybe they want to buy another couple of profitable GP practices instead? Would be fine with me.

Quite happy about their profit growth in the Doctors and Community health divisions - this is the future (and lots of ageing population based tailwind).

It would make sense to buy medical centres if they can get them. Good urban group practices sell for 3-4x EBIT, a lot less than a pharmacy business.

I wonder how many they own outright vs having a partnership stake. Does anyone know if this information is available?

[ratkin]

It would make sense to buy medical centres if they can get them. Good urban group practices sell for 3-4x EBIT, a lot less than a pharmacy business.

I wonder how many they own outright vs having a partnership stake. Does anyone know if this information is available?

All I know is that since they took over Christchurch south health centre it has gone to the pack. Never get to see the same Dr twice and seems to have high turnover of GPs. Have since changed practice