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  1. #4311
    percy
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    Quote Originally Posted by Joshuatree View Post
    Just checked my buying price ,70c so not far from double bagging!!.And the future looks GREAT. Credit to Percy's exuberance and a few others for dropping this in front of me
    Hi JT,as Hugh Hefner said to The Bunny Girl,"my pleasure."
    The Reserve Bank's reduced capital requirements for Heartland,and the latest profit/trading upgrades have certainly added big "runs to the board".
    I would expect we will see a number of analysts revisiting their forecasts,which will lead to more brokers being comfortable recommending Heartland to their clents.Well run BANK,growth and yield make it a compelling investment.
    REL.Winner69's comments are correct. However I think HNZ's buying of the REL business was correct.Buying an established business certainly has saved them years from getting a start up REL business off the ground.The whole REL sector came off the boil a few years ago.Has not even been on simmer,just left to go cold..It will take some time to reheat the whole REL sector.Yet I see it as a huge growth sector because of NZder's cash poor,asset rich love of property.Makes excellent sense to me that Heartland have identified this growth sector and moved to buy the major player.

  2. #4312
    ShareTrader Legend Beagle's Avatar
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    Maths is WAY wrong mate...here let the accountant sort this for you.

    125 = last years EPS 9.0 x (8.5 + 2G)

    The number in the brackets must therefore be 13.89 as 13.89 x 9 = 125.
    By deduction we then see 2G must be 5.39, therefore 1G = 2.7.

    The current SP indicates the long term EPS growth rate using the formula is only 2.7%

    Quite obviously this is silly and the long term growth rate will easily outstrip that low rate.

    Looking at last years EPS growth rate and this year's forecasted growth rate and using anything like those growth rates in the Ben Graham's formula makes HNZ look like one of the most fundamentally undervalued stocks on the NZX, which it is. Brokers have EPS growth conservatively estimated at circa 10% for the next few years.
    If we assume they can keep growing at that rate using the formula we get V = 9 x (8.5 + 2x10) = $2.56.
    And before anyone suggests we need to use the updated B.G formula, we don't, most brokers are now moving down into the mid 4% range for long term risk free rate on the back of 10 year Govt stock rates dropping through the floor, down another 10 bps this morning, now approaching 3.5%, so using 4.4% for a 20 year risk free rate seems entirely reasonable to me.
    Last edited by Beagle; 29-01-2015 at 11:24 AM.

  3. #4313
    The Wolf of Sharetrader
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    I see.

    The maths is actually correct, our 2 versus 2.7 only comes down to the EPS figure used (I just used 10 as a more recent trailing figure). It's my interpretation of what 2.7 or 2 as G actually meant. The website I looked at stated G was a percentage, 1 being 100% and therefore 0.1 being 10%. However it is a raw percentage not a decimal, ie 2 means 2%.

  4. #4314
    ShareTrader Legend Beagle's Avatar
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    Fair enough mate...you lost me in your maths so I felt compelled to do my own, no offence intended

  5. #4315
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    @nextbigthing I think g is the long term % growth, not growth in decimals. If you used % growth, your answer will be similar to Roger's.

  6. #4316
    ShareTrader Legend Beagle's Avatar
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    Quote Originally Posted by nextbigthing View Post
    Not at all Roger! Thanks, you're quite right. The G is a % not a decimal!
    All sorted then mate. I don't think using 10% is unreasonable as a 7-10 year growth rate. Its a young company and if we look at some of the very mature Australian owned banks plenty of them are still growing at that sort of rate.
    Factor in with HNZ's niche product offer their net interest margin is double that of the Aussie banks, the rapidly aging population base making HER lending a compelling long term growth opportunity, (does this put HNZ is the wellness old folks healthcare sector with much higher PE's ) and what's to stop them growing EPS at circa 10% per annum ???? (GFC Mk2 seems to be the only material risk to me).

  7. #4317
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    Quote Originally Posted by janner View Post
    So far correct..

    Not much action until the next report..

    Take into account the overhang.. ( All ready spoken for... IMHO. )..

    You have until April :-)))) Also IMHO..

    Not increasing my holding.. Apart from DRP..

    Having ridden this one from the early stages and not selling .. ( Aye percy )...

    Feel there are other stocks available that will give better Dividend returns.. For my new SAVINGS !!....
    Well the " Burst " came a little early.. ( 3 months plus wages )..

    So will bring forward my April to Feb.. When the results come out.. Which will then be another " Burst ". Followed by Consolidation IMHO..

    Having been in this one since the before the beginning with percy and others..

    It is good to reap the rewards .. Aye percy :-))

    Bottom drawer stuff for you newbies !! :-)))) IMHO.. DYOR.. :-))

  8. #4318
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    132, all time record!

  9. #4319
    ShareTrader Legend Beagle's Avatar
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    Hot off the Chch rumour mill... Uncle Percy was just seen eagerly quaffing his favourite refreshment down at his local looking very contented indeed
    Last edited by Beagle; 30-01-2015 at 04:17 PM.

  10. #4320
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    all major analysts price target revised to lo1.21, med1.28, hi1.35.

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