HGH - Heartland Group Holdings

[percy]

No point in doing that percy - only a modest correlation between dairy prices and NZD:USD cross.

What surprises most people is that there is no correlation between dairy prices and GDP growth (actually slightly negative)

What happens to dairy prices (ie farm incomes) doesn't really impact the economy ...... but spookily seems to impact the HBL share price

I live and learn.
Always thought NZ $ followed dairy prices as dairying made up approx 24% of NZ exports.Dairy prices drop, NZ$ drops.Dairy prices rise. NZ $ rises.

[Beagle]

TSB Bank, (credit rating A-) in the market offering 3.75% for 9 month money, (thinking of depositing one of my bones with them), "trumping", (I dislike that word now for some strange reason), HBL's, (credit rating BBB) former market leading offer. HBL to trump TSB bank tomorrow and offer 3.8-3.9% ? I know these sort of deposit rates bore most people to tears, and fully understand why but the fact remains that the term deposit space is getting more competitive. Just as well HBL have the best net interest margins in the banking industry by miles.

[winner69]

I live and learn.
Always thought NZ $ followed dairy prices as dairying made up approx 24% of NZ exports.Dairy prices drop, NZ$ drops.Dairy prices rise. NZ $ rises.

You in good company percy - Reserve Bank Governer Wheeler seems to think so as well. One of the reasons he has got things wrong lately.

Since 2013 there's actually been a moderately negative correlation between changes in the NZD and changes in dairy prices - interesting eh

[winner69]

HBL share price down today - on a day when NZX seems to be doing well

Hope it recovers by 5pm

[trader_jackson]

HBL share price down today - on a day when NZX seems to be doing well

Hope it recovers by 5pm

No wories.

It's already recovered from its 'blip'... everyone to busy buying Arvida you think? (another "growth + dividend" company)

[percy]

HBL share price down today - on a day when NZX seems to be doing well

Hope it recovers by 5pm

And so it came to pass, HBL's share price ended the day up 0.7%.
Considering there is a SPP coming up in February ,today's $1.51 finish is rather pleasing.

[winner69]

Hey percy, UDC sold 1.6 times book value

Heartland trading close to that at the moment .....hmmm

[Beagle]

What PE multiple was it sold at mate ?

Lazy hound decided to dig it out himself http://www.scoop.co.nz/stories/BU161...net-profit.htm
$58.5m, solf for $660m = historical FY16 PE of only 11.2 (UDC a very good business with a very long track record).

Heartland trading at $1.50 of a forecast FY17 forward PE of 12.5 ! (assuming 12.0 cps earnings), mid point of forecast range.

Conclusion - Heartland fully priced at the current level.

[winner69]

What PE multiple was it sold at mate ?

Looks like 11.1 times 2016 NPAT from numbers on ANZ fact sheet

[percy]

Hey percy, UDC sold 1.6 times net assets

Heartland trading close to that at the moment .....hmmm

hmmmmmmmmmmm,yes.
I think $660 mil is a good price for ANZ to have received.
Will be interesting comparing the growth UDC, under Chinese ownership,achieves, against Heartland's over the next year or two.
I would think "momentum" is on Heartland's side,therefore Heartland would appear to be either "fair" value or slightly undervalued,going on just times net assets.
A year ago, the acquisition of UDC and/or MTF seemed to be te only way Heartland would achieve growth.
This has been proved incorrect,as Heartland have achieved very strong organic growth.This very strong growth is set to continue, as Heartland's strategy of digital products delivered online gains more traction.