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13-06-2014, 09:51 PM
#3131
Originally Posted by winner69
Fair enough Percy
Bit worried about that Interest Rate Risk though
Don't be.!!!
As we both know rising interest rates mean bigger margins for banks.!!!
Bigger margins result in bigger profits.!
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13-06-2014, 09:52 PM
#3132
Originally Posted by winner69
If it was that easy mate
Why not use regional US banks as a benchmark ....PE of 22 ......gives HNZ a value of 160 odd
That should be the target I reckon
Tottally agree!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! lol.
Forecast EPS 8.8cents ..x PE of 22 ..gives a share price of $1.96.!!!!!! Fantastic.
Keep up the good work Winner69.....I love it.!!!! lol.
Last edited by percy; 14-06-2014 at 07:23 AM.
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14-06-2014, 09:09 AM
#3133
Originally Posted by winner69
If it was that easy mate
Why not use regional US banks as a benchmark ....PE of 22 ......gives HNZ a value of 160 odd
That should be the target I reckon
Yep great target,but I think Heartland (who have wonderful adds by the way)would need to make a juicy shareholder friendly aquisition.
A good sized aquisition. I have a lot riding on these bankers.
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14-06-2014, 09:19 AM
#3134
Originally Posted by kizame
Yep great target,but I think Heartland (who have wonderful adds by the way)would need to make a juicy shareholder friendly aquisition.
A good sized aquisition. I have a lot riding on these bankers.
The Sentinel acquisition certainly was/is a more than "good sized" acquisition.Market leader in a fast growing sector.Fantastic.!!
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14-06-2014, 10:34 AM
#3135
Reality Check.
Average PE of the financials sector in the States is only 12, (source CNBC).
Heartland by its nature and the type of lending is riskier than the main Australian banks on an average PE of 14 so a fair PE has to account for the extra risk.
I reckon for where the company is at, (needs more runs on the board), a fair PE at present is 11 - 11.5 based on current years projected earnings.
As the company continues to prove itself over the next few years we could see that PE expand very gradually to
12.5 - 13.0.
Last edited by Beagle; 14-06-2014 at 10:35 AM.
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14-06-2014, 10:41 AM
#3136
Originally Posted by Roger
Reality Check.
Average PE of the financials sector in the States is only 12, (source CNBC).
Heartland by its nature and the type of lending is riskier than the main Australian banks on an average PE of 14 so a fair PE has to account for the extra risk.
I reckon for where the company is at, (needs more runs on the board), a fair PE at present is 11 - 11.5 based on current years projected earnings.
As the company continues to prove itself over the next few years we could see that PE expand very gradually to
12.5 - 13.0.
OK lets be generous and say a PE of 12 ..... shareprice 88
But that's the market is saying at the moment ....stupid market just does not get it
Agree Roger prove themselves as Percy says they will and maybe a slight rerating .... but not that match. Seems earnings growth is the key
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14-06-2014, 11:25 AM
#3137
Date disambiguation
Originally Posted by Paper Tiger
No. Snoopy has totally the wrong data for FY2013 (Dec-12).
Have been corresponding with PT off line and he has informed me the above date is a typo. But there is an inconsistancy with date interpretation on this thread. So I need to put a stake in the ground to mark where I stand, and what the abbreviations I use stand for. There is no 'correct' way to do this. I am just telling you my way.
To the general public the calendar year starts in January and ends in December. For 2014, I abbreviate this to CY2014.
Sharemarket listed companies though, can choose the start date for their financial year to be any month. With Heartland it starts in July and ends in June. I usually number the financial year based on whatever number the company puts on the front cover of their report. This years report is not out yet. But for the last full year reported period 01-07-2012 to 30-06-2013, the cover said 2013. So right now we are in the period 1st July 2013 to 30th June 2014 which I call FY2014.
'Turners' (TUA) have a financial year that starts on 1st January and ends on 31st December. For Turners CY2103 = FY2013. BUt this is the rare exception. Usually CY20xx and FY20xx refer to different staggered start points in time.
Back to the specific example: FY2013 as I write it, with reference to Heartland, does not refer to the annual time period ending 31st December 2012, nor to the period ending 31st December 2013. It refers to the 12 months ending 30th June 2013.
SNOOPY
Last edited by Snoopy; 14-06-2014 at 11:27 AM.
Watch out for the most persistent and dangerous version of Covid-19: B.S.24/7
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14-06-2014, 11:50 AM
#3138
I am happy with either a PE of 11 or 12,[depending on the company's growth guidance].I note FB are projecting EPS growth of 12.5% for year ended 30/6/2015.
On earnings projected at 8.8 cents year ended 30/6/2014 a PE of 11 would give a SP of 96.8 cents while a PE of 12 would give a SP of $1.056 cents.
Until we have guidance from the company we are only guessing at 2015 earnings.Again should we agree with Forsyth Barr's research dated 3rd April 2014,they project 2015 earnings per share of 9.9cents.On PE of 11 that is a SP of $1.089 and at a PE of 12 that is a SP of $1.188.
Roger it may pay to consider using PEGD [which includes dividends] when comparing bank shares.I think Heartlands risk is more than compensated by the higher dividend yield, which is also fully imputed. So dividend yield may be just as an important ratio when comparing Aussie banks to HNZ.
Here is a look into my mind.!!! PE 10, dividend 6%, growth 12% PEG 10 div by 12 = .833 [well under 1]
or PEGD PE 10 divided by 18 [div 6% plus growth 12] gives PEGD of .55555 . You can see why I like Heartland.
No allowance has been made for the advantages shareholders gain from dividend reinvestment.
Last edited by percy; 14-06-2014 at 11:52 AM.
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14-06-2014, 11:56 AM
#3139
Originally Posted by Snoopy
HY2014 (as at 31st December 2013)
Financial Assets (0-3 months), Financial Liabilities (0-3 months), Derivative Adjustment, Remainder:
$1,545.827m, $1,219.768m , $196.815m $522.874m
Financial Assets (3-6 months), Financial Liabilities (3-6 months), Derivative Adjustment, Remainder: $127.456m, $331.145m, -$20.335m ,-$224.024m
Financial Assets (6-12 months), Financial Liabilities (6-12 months), Derivative Adjustment, Remainder: $181.345m, $402.912m , -$38.850m, -$260.417m
Financial Assets (1-2 years), Financial Liabilities (1-2 years), Derivative Adjustment, Remainder: $290.823m,$69,530m -$86.325m,$144.168m
Financial Assets (2+ years), Financial Liabilities (2+ years), Derivative Adjustment, Remainder:
$199.587m, $54.113m, $-71.305m ,$74.169m
FY2013 (as at 30th June 2013)
Financial Assets (0-3 months), Financial Liabilities (0-3 months), Derivative Adjustment, Remainder: $744.290m $1,011.916m, 0, -$267.626m
Financial Assets (3-6 months), Financial Liabilities (3-6 months), Derivative Adjustment, Remainder: $4.250m, $339.250m, 0 ,-$335.0m
Financial Assets (6-12 months), Financial Liabilities (6-12 months), Derivative Adjustment, Remainder: $21.332m, $373.581m, 0, -$352.249m
Financial Assets (1-2 years), Financial Liabilities (1-2 years), Derivative Adjustment, Remainder:
$7.059m, $111.129m, 0, -$104.070m
Financial Assets (2+ years), Financial Liabilities (2+ years), Derivative Adjustment, Remainder:
$3.032m ,$52.743m, 0 , -$49.711m
Ok folks I have made a mistake above, but it is not the mistake that PT thinks. Time periods are correct, as I was not trying to compare year with year as PT assumed. I wanted a six monthly comparison. But the data should read as follows (first section of figures for HY2014 was correct):
HY2014 (as at 31st December 2013)
Financial Assets (0-3 months) |
Financial Liabilities (0-3 months) |
Derivative Adjustment |
Remainder |
$1,545.827m |
$1,219.768m |
$196.815m |
$522.874m |
Financial Assets (3-6 months) |
Financial Liabilities (3-6 months) |
Derivative Adjustment |
Remainder |
$127.456m |
$331.145m |
-$20.335m |
-$224.024m |
Financial Assets (6-12 months) |
Financial Liabilities (6-12 months) |
Derivative Adjustment |
Remainder |
$181.345m |
$402.912m |
-$38.850m |
-$260.417m |
Financial Assets (1-2 years) |
Financial Liabilities (1-2 years) |
Derivative Adjustment |
Remainder |
$290.823m |
$69,530m |
-$86.325m |
$144.168m |
Financial Assets (2+ years) |
Financial Liabilities (2+ years) |
Derivative Adjustment |
Remainder |
$199.587m |
$54.113m |
$-71.305m |
$74.169m |
FY2013 (as at 30th June 2013)
Financial Assets (0-3 months) |
Financial Liabilities (0-3 months) |
Derivative Adjustment |
Remainder |
$1,589.306m |
$1,220.880m |
$179.350m |
$546.776m |
Financial Assets (3-6 months) |
Financial Liabilities (3-6 months) |
Derivative Adjustment |
Remainder |
$125.518m |
$339.250m |
$18.700m |
-$232.432m |
Financial Assets (6-12 months) |
Financial Liabilities (6-12 months) |
Derivative Adjustment |
Remainder |
$213.370m |
$373.581m |
-$45.330m |
-$205.541m |
Financial Assets (1-2 years) |
Financial Liabilities (1-2 years) |
Derivative Adjustment |
Remainder |
$229.096m |
$111.129m |
-$61.200m |
$56.767m |
Financial Assets (2+ years) |
Financial Liabilities (2+ years) |
Derivative Adjustment |
Remainder |
$191.201m |
$52.743m |
-$54.120m |
$84.338m |
SNOOPY
Last edited by Snoopy; 28-08-2014 at 02:43 PM.
Reason: reformat tabulated data using HTML
Watch out for the most persistent and dangerous version of Covid-19: B.S.24/7
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14-06-2014, 01:49 PM
#3140
Originally Posted by percy
I am happy with either a PE of 11 or 12,[depending on the company's growth guidance].I note FB are projecting EPS growth of 12.5% for year ended 30/6/2015.
On earnings projected at 8.8 cents year ended 30/6/2014 a PE of 11 would give a SP of 96.8 cents while a PE of 12 would give a SP of $1.056 cents.
Until we have guidance from the company we are only guessing at 2015 earnings.Again should we agree with Forsyth Barr's research dated 3rd April 2014,they project 2015 earnings per share of 9.9cents.On PE of 11 that is a SP of $1.089 and at a PE of 12 that is a SP of $1.188.
Roger it may pay to consider using PEGD [which includes dividends] when comparing bank shares.I think Heartlands risk is more than compensated by the higher dividend yield, which is also fully imputed. So dividend yield may be just as an important ratio when comparing Aussie banks to HNZ.
Here is a look into my mind.!!! PE 10, dividend 6%, growth 12% PEG 10 div by 12 = .833 [well under 1]
or PEGD PE 10 divided by 18 [div 6% plus growth 12] gives PEGD of .55555 . You can see why I like Heartland.
No allowance has been made for the advantages shareholders gain from dividend reinvestment.
Great post Percy. I think your posts highlights how little downside risk there is in the price. If we saw a strong FY15 forecast and a change in sentiment towards the stock (to a pe of 13), I think we would see 1.20 very quickly.
The reverse mortgage business is going to help a lot of old people enjoy their retirement. This will also boost the NZ economy. Bowls clubs around the country are buzzing
DISC: Hold shares in HNZ and enjoy a good ramp
No advice here. Just banter. DYOR
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