Quite a tight Share Register - infact tighter than some may realise
2 major holders who appear quite happy with slightly more than 64% in each of past 9+ years
An estimate of core holders looks like at a guess roughly 70% - 80% of issued Capital tied up in hands of larger holders
at times across past 8-9 years
Try buying large enough parcels & this is quite evident at times
Lack of recent dividends may have shaken a few out, but never the less probably still looks tightish
Who knows, some of the pharmacy takeovers & combinations may have resulted in GXH shares being issued as well .. ?
I would say a takeover aint going to happen unless major stakeholders see something better
they really like enough to move
Any better Castles likely to be on offer to relinquish holding the joint reins of the existing castle ?
The major stakeholders probably rule the roost as well -- be that on whether a dividend gets spat out
or the other passengers onboard see the fruits of the years activities applied to acquisitions etc.
I guess one of those 'Love it or Leave' situations .. let's hope the big guys get their appetite back real
soon for fully imputed distributions on the generous side ..
Its been on my watchlist but I've never bought. My thoughts:
- I'm starting to wonder if they are trying to re-position the business to be more nimble and like HLG where it becomes a dividend machine in the future. I can see it with a low debt structure, paying consistent dividends. First it needs to shake off debt, make smart acquisitions and position itself to benefit post covid (unless they get bought). I also think it could be a good recovery stock when interest rates go up because they won't have those financing costs.
- The pharmacy results are much worse than they let on in the summary, and the result overall is a little bit rosier than at first glance. In the segment report, they do note that $10.8m was paid by the government in wage subsidy and $9m of that was paid to the pharmacy segment.
If you take total pharmacy revenue less than the pharmacy wage subsidy then its a 9% decrease on previous year. I also read that they were open throughout due to their status as an essential service so this can't really be used as reasoning in terms of covid-19. I can see this accelerating with the number of chemist warehouses I see pop up and the number of stores they plan on having.
- The statement of cashflows shows where the good work for me lies. To make $70m is operating cashflow and pay down a further $34.8m in debts in really pleasing to see. To more than halve debt in the past financial year will hold them in good stead to pay dividends. It would be a ripper of a dividend too considering they used to pay 7c a year which is just $10m to them (they currently have $37m in the bank). I do think they will pay the balance off in the next financial year.
Valuation: At about a 9 PE, its not a bad buy for future dividends once resumed if yield is your thing. I wouldn't be suprised if they waited it out for another year though and got the debt to 0 before they consider dividends.
Also not sure if they have but a $150m market cap and $37m in the bank is very enticing for a takeover given valuation and a stable base to start making changes (I often wonder if the IFTs of the world have ever thought about putting a bid in). For me, I have a rule due to past dealings to not buy retail stocks but I'm close to breaking that.
Disc: Not a holder but a interesting value play.
They are not going to pay any dividend soon.
"The Board has decided not to declare a final FY21 dividend in order to preserve cash to assist the Company with accelerating its acquisition activities."
This will mark the company as a growth company. I would prefer they to issue a bond to complete large acquisition under such low interest rate environment. However, the management will use dividend to acquire 2-4 medical center each year. Shareholders need a new ambitious CEO. Do not buy this sucker.
Good result IMO. 22 million debt, cash of 34 million - net cash of 12 million. 16 million profit with market cap of 150 million odd. PE ration of 9-10 - very cheap indeed
Medical practice business is growing very well. Pharmacy business is resilient despite the competition from chemist warehouse. I am a medic and the vast majority of the prescriptions I am emailing (eprescribing), based on the requests from patients, are to regular pharmacies such as unichem (I have hardly sent prescriptions to chemist warehouse).
Chemist warehouse is excellent for health supplements, OTC medications, beauty products/perfumes etc but, when it comes to the medical/pharmaceutical prescription drugs regular pharmacies are better value IMO - they usually have pharmacists who provide advice to their patients about their medications (when and how to take it, before/with/after food etc). If there are any issues their pharmacists contact the doctor who prescribed the drugs to clarify - hard to get this type of service from chemist warehouse who are very busy with their non-medical non-prescription health/beauty retail business..
Good result IMO. 22 million debt, cash of 34 million - net cash of 12 million. 16 million profit with market cap of 150 million odd. PE ration of 9-10 - very cheap indeed
Medical practice business is growing very well. Pharmacy business is resilient despite the competition from chemist warehouse. I am a medic and the vast majority of the prescriptions I am emailing (eprescribing), based on the requests from patients, are to regular pharmacies such as unichem (I have hardly sent prescriptions to chemist warehouse).
Chemist warehouse is excellent for health supplements, OTC medications, beauty products/perfumes etc but, when it comes to the medical/pharmaceutical prescription drugs regular pharmacies are better value IMO - they usually have pharmacists who provide advice to their patients about their medications (when and how to take it, before/with/after food etc). If there are any issues their pharmacists contact the doctor who prescribed the drugs to clarify - hard to get this type of service from chemist warehouse who are very busy with their non-medical non-prescription health/beauty retail business..
Discl - hold
Similar experience here, most of my scripts go to Unichem or Life Pharmacies.
Medical practices seem to sell for about 3x EBIT, so should be earnings accretive if they can secure more.
I'm hesitant to buy in due to liquidity, but it's on the watchlist.
Beagle reminded us this morning about good old Ben’s saying In the long run the market is a weighing machine, not a voting machine
The weighing machine is starting to weigh a fairer value
They are retaining profits and not paying rewards to patient (unintended pun) shds... so at least there is finally price appreciation. I am not getting hopes up and thinking it is a share worth holding. Gave up and sold after holding during 2020 anticipating, as an essential business there would be good returns
Actually - just noticed that ShareClarity reviewed and updated their DCF valuation for GXH after the FY result. DCF used to be at $1.14 and has now changed to $1.47;
Didn't realize they have that many followers ...
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"Prediction is very difficult, especially about the future" (Niels Bohr)
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Originally Posted by value_investor
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