GEM - G8 Education - Childcare Operator

[VL SNTCHR]

Hi edison

Great choice with GEM.We shall watch this space.

Cheers
Blocker3

Yes it is doing well blocker, but you should be cautious about recommending people to buy in...

A bit of a reality check with GEM is to take note that they are buying centres at 4xEBIT...yet look at what the market values GEM at...its a heck of a lot more than 4xEBIT!!!

They should be valued more than 4xEBIT (especially whilst they are acquiring centres at rapid pace due to a fragmented market) as they:

• have a proven management team who is doing what they say
• they have operational scale which helps in a number of ways including buying power, employee pool etc.,
• they are (potentially) building a trusted brand
• they are a listed entity with access to capital markets

So the above provides some reasoning for an increase in the multiple that the education centres are worth...but the question is - how much extra does the above warrant?!

[blocker3]

Yes it is doing well blocker, but you should be cautious about recommending people to buy in...

A bit of a reality check with GEM is to take note that they are buying centres at 4xEBIT...yet look at what the market values GEM at...its a heck of a lot more than 4xEBIT!!!

They should be valued more than 4xEBIT (especially whilst they are acquiring centres at rapid pace due to a fragmented market) as they:

• have a proven management team who is doing what they say
• they have operational scale which helps in a number of ways including buying power, employee pool etc.,
• they are (potentially) building a trusted brand
• they are a listed entity with access to capital markets

So the above provides some reasoning for an increase in the multiple that the education centres are worth...but the question is - how much extra does the above warrant?!

Hi VL SNTCHR.


Fair call on your first sentence. Point taken. I was basing my information off a valuation of $6.00 also.

Cheers
Blocker3

[klid]

Sad because I bought and sold this stock for $1.385 a couple of years ago after holding for a couple of months.

Shot up since then, as it was before too, is there still upside potential now?

[blocker3]

Sad because I bought and sold this stock for $1.385 a couple of years ago after holding for a couple of months.

Shot up since then, as it was before too, is there still upside potential now?

Hi Klid

I believe so. I have just purchased more shares in this company.

An independent link below may answer your questions

http://www.4-traders.com/G8-EDUCATION-LTD-9711633/

http://www.asx.com.au/asxpdf/2014081...ch0s41pkf3.pdf



Cheers
Blocker3

[Joshuatree]

Ive read a thread on another forum where childcare centres in Aus are going to have to increase the staff to child ratio from 1 to 8 to 1 to 5 .Still trying to find that thead again .Can anyone else verify this?.Will the Govt increase subsidies or not. and how will it affect Owners (as opposed to operators) of centres like AET?

[Joshuatree]

Many Thanks to Karen for this. Some ratios already activated a few to come; varies within states.



Improved educator to child ratios


Improving educator to child ratios allows staff to give more individual care and attention and contributes to better social and learning outcomes for children. Educators are able to develop more effective and meaningful relationships with children, resulting in more engaged, happy and relaxed individuals.

Some states and territories have made provisions that affect requirements to services. These provisions are set out in chapter 7 of the National Regulations. For questions regarding these requirements, please contact your state or territory regulatory authority.



Centre-based services

Age of children	Educator to child ratio	Date requirement applies from
Birth to 24 months	1:4	1 Jan 2012 - in all states and territories (1 August 2012 in WA)
Over 24 months and less than 36 months	1:5	1 Jan 2012 - in ACT, NT, TAS 1 August 2012 - in WA 1 Jan 2016 - in NSW, QLD, SA Saving provision applies in VIC
Over 36 months up to and including preschool age	1:11	1 Jan 2012 - in ACT, NT 1 Jan 2016 - in QLD, VIC Saving provision applies in NSW, SA, TAS, WA
Over preschool age	No national ratio has been set (state and territory ratios may apply)

Family day care services

Age of children	Educator to child ratio	Date requirement applies from
Birth to 13 years	1:7, with no more than four children preschool age or under	1 Jan 2012 - in ACT, QLD, SA, VIC 1 Jan 2014 - in NSW, NT, TAS, WA

- See more at: http://www.acecqa.gov.au/national-qu....XZ1CCm7s.dpuf

[Joshuatree]

http://www.abc.net.au/news/2014-11-1...hanges/5897918

Also this one (Karen) .Fees may go up $100 a week.

[blocker3]

Some more positive share movement today as the new pre school year kicks in.

[Joshuatree]

For what its worth.In the latest AFR Smart Investor; their annual"Hot stocks" picks where 12 "experts" pick their 2 best ideas for the year, two have picked GEM

[blocker3]

For what its worth.In the latest AFR Smart Investor; their annual"Hot stocks" picks where 12 "experts" pick their 2 best ideas for the year, two have picked GEM

I like independent positive information from another sector.
Thanks Joshuatree