-
04-06-2015, 09:03 AM
#5161
Originally Posted by winner69
Could e one of the reasons why Heartlands profits have stagnated recently, like Q4 being less than Q3 and H2 being same as H2
You see stagnation,I see solid growth, Heartland achieving their stated objectives.
-
04-06-2015, 09:06 AM
#5162
Originally Posted by percy
You see stagnation,I see solid growth, Heartland achieving their stated objectives.
So just a temporary blip earnings not growing .....or is Jeff not being up front with what is really going on.
I only seeing what they put out ...and that's H2 the same as H1, after several years of continuous growth
-
04-06-2015, 09:07 AM
#5163
Originally Posted by winner69
This paragraph in this article caught my eye
http://www.interest.co.nz/rural-news...on-after-sixth
"The Financial Stability Report was silent on what action would the RBNZ take if it believed the dairying sector was becoming a threat to financial stability. But we think the most likely response is that the RBNZ would require banks to hold a larger capital buffer against their existing agricultural loans, to absorb an expected rise in defaults"
Of course the farmers would be paying for this in higher rates, couldn't expect shareholders to cover that could we.
Then again Heartland is already so over capitalised it won't affect them.
I think you must keep in mind Warren Buffett's quote;"when the tide goes out, we will see who is swimming naked."
The big losers in the dairy sector will most probably be the lenders who have lent on dairy farm conversions.I expect we will see some surprises,with 1st mortgages over land looking "at risk".
And yes some banks will have to shore up their capital.
As I have pointed out,and you noted the SMH article,the Aussie banks face challenges that are putting their share prices under pressure.
Heartland do not face these pressures,however they are suffering the "rub off"of investors avoiding, or leaving the sector.
With increasing profits,and dividends,Heartland will recover.Any acquisition, or credit rating upgrade will speed up the recovery.
Last edited by percy; 04-06-2015 at 09:17 AM.
-
04-06-2015, 09:16 AM
#5164
Originally Posted by winner69
Could e one of the reasons why Heartlands profits have stagnated recently, like Q4 being less than Q3 and H2 being same as H2
HNZ is a seasonal business. I don't think their is much value comparing quarters in the same year. Better to compare q315 vs q314
Banking NPBT for 9mths to 31 march 15 43527
Banking NPBT for 9mths to 31 march 14 36980
Growth 17.7%
But maybe there has been a slowdown in the last 3 months?
Banking NPBT for 3mths to 31 march 15 15245
Banking NPBT for 3mths to 31 march 14 12891
Growth
18.2%
No slowdown. So if anything, the foot is going down on the accelerator over the last 3 months.
Given HNZ is now trading on a FY15 pe=12, and growth of 18%, I'm quite comfortable with valuation.
This analysis excludes the HER business as I don't have quarterly data for this. Remember, the HER business also includes some tax losses.
Last edited by noodles; 04-06-2015 at 09:19 AM.
No advice here. Just banter. DYOR
-
04-06-2015, 09:22 AM
#5165
Originally Posted by percy
I think you must keep in mind Warren Buffett's quote;"when the tide goes out, we will see who is swimming naked."
The big losers in the dairy sector will most probably be the lenders who have lent on dairy farm conversions.I expect we will see some surprises,with 1st mortgages over land looking "at risk".
And yes some banks will have to shore up their capital.
As I have pointed out,and you noted the SMH article,the Aussie banks face challenges that are putting their share prices under pressure.
Heartland do not face these pressures,however they are suffering the "rub off"of investors avoiding, or leaving the sector.
With increasing profits,and dividends,Heartland will recover.Any acquisition, or credit rating upgrade will speed up the recovery.
So to summarise percy,
Aussie banks need additional capital to stand still.
HNZ has excess capital to apply to loan growth
HNZ is clearly on a much faster growth path than the aussie banks.
Why are we comparing pe ratios between them?
Last edited by noodles; 04-06-2015 at 09:35 AM.
No advice here. Just banter. DYOR
-
04-06-2015, 09:25 AM
#5166
Noodles, maybe seasonal business but for several years any half year earnings have been more than previous half year
Have you ever tried a seasonally adjusted earnings series, interesting
-
04-06-2015, 09:32 AM
#5167
Originally Posted by winner69
Noodles, maybe seasonal business but for several years any half year earnings have been more than previous half year
Have you ever tried a seasonally adjusted earnings series, interesting
Please show your analysis
I think comparing quarters should do the same job.
Last edited by noodles; 04-06-2015 at 09:34 AM.
No advice here. Just banter. DYOR
-
04-06-2015, 10:33 AM
#5168
Originally Posted by noodles
So to summarise percy,
Aussie banks need additional capital to stand still.
HNZ has excess capital to apply to loan growth
HNZ is clearly on a much faster growth path than the aussie banks.
Why are we comparing pe ratios between them?
Yes................
Yes.............
Yes..............
Maybe because we have no other listed NZ bank.
-
04-06-2015, 11:40 AM
#5169
Originally Posted by noodles
So to summarise percy,
Aussie banks need additional capital to stand still.
HNZ has excess capital to apply to loan growth
HNZ is clearly on a much faster growth path than the aussie banks.
Why are we comparing pe ratios between them?
Aussie banks have an enviable record of profit growth and have built their credibility over many decades through all sorts of economic conditions.
Yes the regulator wants them to recapitalise to international standard capital ratio's but they're not doing this to "stand still"
We're comparing PE ratio's because they're quite obviously the relevant comparisons. Consensus EPS forecast is 9.75 cps this year v 9.0 cps last year, hardly stellar growth and not especially inspiring compared to the Aussie banks.
Consensus EPS for 2016 is 10.4 cps so consensus implied growth in 2016 is 6.6%. Quite clearly I am more bearish on bad and doubtful debtors in FY16 and especially FY17 and doubt we'll see much EPS growth, if any.
Aussie banks have the runs on the board over a vastly greater timeframe than HNZ and also a much stronger credit rating and are operating in a lower risk sector than HNZ, (mining company loans excluded).
At the risk of sounding like a broken record, Dairy is potentially to HNZ what Iron ore is to the Aussie banks so to me its somewhat disingenuous to suggest HNZ doesn't face its own unique set of challenges of a very similar nature to the Australian entities. Selling Holden's to sharemilkers on no deposit no payment terms till 2016...they're good for it right ?
Last edited by Beagle; 04-06-2015 at 11:49 AM.
-
04-06-2015, 04:37 PM
#5170
Originally Posted by noodles
Please show your analysis
I think comparing quarters should do the same job.
Stats NZ released the Building Activity Survey and headlined Non-residential activity down 1% - seasonally adjusted of course even though actual activity was up more than 10%
You pointed out heartland earnings are seasonal, I had never thought so.
Applying a basic seasonality factor based on half year earnings then Heartlands H2 earnings guidance of $23.5m (actual) is a seasonally adjusted 9% DOWN on previous half year .....even though 24% more than the same half year a year earlier in actual terms.
Load of **** eh .... Methinks heartland earnings aren't really seasonal and the fact that in the past H2 is higher than H2 is more to do with an underlying growth trend (not seasonal) which has now come to an end.
Whatever come August Jeff will be touting the huge growth achieved and saying well positioned for this to continue .....and hoping like hell H1 will be better than The current half year.
Share price cheap as eh ......if Roger used his graham formula and your 18% growth we would get $2 plus .....wouldn't we?
Have a nice chart showing thee seasonally adjusted earnings but cant load from a ipad
Last edited by winner69; 04-06-2015 at 05:29 PM.
Tags for this Thread
Posting Permissions
- You may not post new threads
- You may not post replies
- You may not post attachments
- You may not edit your posts
-
Forum Rules
|
|
Bookmarks