GXH - Green Cross Health (formerly PHB - Pharmacybrands)

[Lewylewylewy]

+7.8% so far today. My question is: huh?!

[BlackPeter]

Gosh ... the SP graph looks not very inspirational these days - does it? Cross of death in November and downhill from there on no news.

Suppose markets don't believe anymore in the growth story ... and on a pure PE / low growth basis they are obviously still significantly overvalued.

Discl: sold out around the XoD ...

[Nasi Goreng]

I think that volumes are so low, that its really easy for share price to go up and down on no news at all.

Its a good business and theres still a growth story there. Good buying around these levels I reckon.

[BlackPeter]

I think that volumes are so low, that its really easy for share price to go up and down on no news at all.

Its a good business and theres still a growth story there. Good buying around these levels I reckon.

Volumes not that low - and we are talking now already the 5th month after the XoD, i.e. it is not a blib either.

But sure - markets can be wrong - that's what astute investors exploit. Not sure though, whether I'd see them at this stage as a bargain:

Looking into my spreadsheet: average P/E 23, forward PE (based on my guess ...) 16 and growth rate (based on the HY report): 7.7%; I'd say the current SP looks about right, but certainly not a bargain. For it to go up again, they need to pull in my view another rabbit out of the hat (which they might ... but I just don't see it).

[Food4Thought]

Volumes not that low - and we are talking now already the 5th month after the XoD, i.e. it is not a blib either.

But sure - markets can be wrong - that's what astute investors exploit. Not sure though, whether I'd see them at this stage as a bargain:

Looking into my spreadsheet: average P/E 23, forward PE (based on my guess ...) 16 and growth rate (based on the HY report): 7.7%; I'd say the current SP looks about right, but certainly not a bargain. For it to go up again, they need to pull in my view another rabbit out of the hat (which they might ... but I just don't see it).

I agree BlackPeter, not really exciting news here. I was hoping they were going to be able to improve their pharmacy business and come up with some better results. Price went a bit too high for what I perceived their value and return... so I sold out and with my gain purchased another lot of SUM.

Long term, still think they'll do better than average and not much competition, especially competition that is listed on the NZX etc.

[James108]

I sold out a few years ago now after the substantial rerating in terms of P/E. I never thought the growth prospects supported such high valuation.

[value_investor]

A bit of a head-scratcher this one. Had so much hype behind it but a lot of money being spent by management on acquisitions that were perhaps not the greatest. I also think investors got ahead of themselves a little bit on its future growth prospects.

A lot of the profit still coming from the Pharmacy side of the business, with the other two business units still looking like problem children. Also it would make me nervous that they haven't looked to be bold on any front.

[noodles]

Steve Browning (CFO) speaking in Auckland on Nov 15.
Details here:
https://www.sharetrader.co.nz/showth...467#post691467

[hardt]

A bit of a head-scratcher this one. Had so much hype behind it but a lot of money being spent by management on acquisitions that were perhaps not the greatest. I also think investors got ahead of themselves a little bit on its future growth prospects.

A lot of the profit still coming from the Pharmacy side of the business, with the other two business units still looking like problem children. Also it would make me nervous that they haven't looked to be bold on any front.

The pharmacy side of things is going to come under pressure once the chemist warehouse arrives in NZ.

[value_investor]

I don't think GXH are prepared in competing with a company such as Chemist Warehouse. I think that the online platform is about 2 or years late and given that NZ is a small population as it is, it could be a rocky path ahead.