HGH - Heartland Group Holdings

[winner69]

SMD position looks a little worse than it did this time last year
http://www.niwa.co.nz/climate/daily-climate-maps

SMD is soil moisture deficit

[Longhaul]

Thanks Paper Tiger, percy and snapiti. The 3rd option looks fairly agreeable, but leaning a little towards HNZ for a couple of reasons - not sure how robust they are but here goes.

1) HNZ SP up 25% over 52 weeks compared to SUM at 45% leads me to believe there is possibly more upside in HNZ in the next 12 months

2) Currently more buyer depth for HNZ, and not a lot of sellers even at these highs indicate holders willing to hold for even better times ahead

3) Better yield

4) (Not sure about this one, feel free to call me out on it) Banks benefit from ridiculous QE going on around the world (see this article about China's recent efforts)

(might have just convinced myself)

[Longhaul]

SMD position looks a little worse than it did this time last year

What are the wider implications of this? Is it (hate to say it) good for a rural lender?

[noodles]

2) Currently more buyer depth for HNZ, and not a lot of sellers even at these highs indicate holders willing to hold for even better times ahead

You say you want to invest for 3 years, yet you look at depth? I'd be looking at pe ratio's and potential growth.

[winner69]

I check this every day winner69 as i have a farm or two, have a look at the charts tommoro or monday and you will see a complete reversal.
I know much of the north island has had 50-100mm of rain over the last 2 days and more to come.
I know my two farms have never had so much grass.
But that is amazing research you have done if you are not a farmer as it was starting to dry out.

Plenty of good rain in lower north as well

I keep an eye on the SMD because the key drivers of economic activity in NZ are how much moisture is in the ground, commodity prices and the NZD. Put those three inputs into a model and you get a pretty good idea of where the underlying NZ economy is heading ...and then add a bit more for the Canterbury recovery.

So not just a forecadt for primary related industries but the economy as a whole. Stood the test of time that modelling.

[karen1]

I have been asked by another poster to post this link http://www.stuff.co.nz/auckland/loca...s-for-new-bank

[percy]

Thanks Karen1.
Reads very well, thought we would all enjoy it .

[Snoopy]

I wonder if Heartland is in industry and rural, not in the mortgage business, and that this type of business might always carry a slightly higher level of loans that need management? If so, then perhaps there is not a problem? Westpac seem to be doing just fine with this sort of level on their own business portfolio, and they do not seem to be trying to exit that sector?

Logical Simla, but I would take issue with your original assumption. I know there has been a lot of talk about HNZ being a niche industry funder to business. However, the actual picture , as laid out in table 40a "Concentrations of Funding" from the FY2013 Annual Report, shows funding split between Finance $258.9m, Households $1.732.1m and listed bonds $106.5m.

So despite the hype, it would seem that Heartland is still largely funding real estate and property, probably a legacy of their PGC and CBS ingredients that went into the pot to make up Heartland.

SNOOPY

[ziggy415]

That is very accurate, I simplify it by saying when the farmers are spending profits the country will always prosper.

The more grass you can grow the better farmers do.
I also have to add rural commodity prices are looking very good and this will be very good for HNZ.

...factor in a labour greens coalition and bobs your....auntie im afraid

[Snow Leopard]

Logical Simla, but I would take issue with your original assumption. I know there has been a lot of talk about HNZ being a niche industry funder to business. However, the actual picture , as laid out in table 40a "Concentrations of Funding" from the FY2013 Annual Report, shows funding split between Finance $258.9m, Households $1.732.1m and listed bonds $106.5m.

So despite the hype, it would seem that Heartland is still largely funding real estate and property, probably a legacy of their PGC and CBS ingredients that went into the pot to make up Heartland.

SNOOPY

I fail to see how anybody can so consistently fail to understand a set of accounts and so consistently post incorrect drivel and fanciful made-up numbers.

We recently had you calculating the levels of Tier 1 & 2 capital for banks instead of just looking it up and your guess being nearly 50% higher than reality.

And now you apparently do not know the difference between lending and borrowing.

Paper Tiger