-
12-02-2017, 03:22 PM
#8651
Originally Posted by horus1
bought them all the way up and will keep buying .They do what they say and do not overhype. Love them and have alot
Nothing wrong with falling in love. Might not be so wise to fall in love with a share though.
SNOOPY
Watch out for the most persistent and dangerous version of Covid-19: B.S.24/7
-
12-02-2017, 03:27 PM
#8652
Originally Posted by percy
Wrong as always on this thread.
According to our friends at Yahoo finance.Share prices
..................1 year....................2 year...................5 year.
ANZ...........29.85%.............minus 15.96%............36.84%
HBL............39.29%...................12.23%.... ...........231.91.
You keep your under performer,and I will keep my high achiever..
So $10,000 miss placed in ANZ 5 years ago would be worth $13,684.00
Same amount invested in HBL would be worth $23,191.00.
I meant ANZ looks the better investment from today. Never said the same five years ago. Not much point in investing looking backwards from what I can see.
I notice you left out dividends (yet again). Of course it doesn't matter from a Heartland perspective, because more capital has been poured into that business structure than has come out as dividends over the last five years.
SNOOPY
Watch out for the most persistent and dangerous version of Covid-19: B.S.24/7
-
12-02-2017, 03:42 PM
#8653
Originally Posted by Snoopy
I meant ANZ looks the better investment from today. Never said the same five years ago. Not much point in investing looking backwards from what I can see.
I notice you left out dividends (yet again). Of course it doesn't matter from a Heartland perspective, because more capital has been poured into that business structure than has come out as dividends over the last five years.
SNOOPY
Dividends.
My post # 425 on ANZ thread.
Dividend growth since 2014.
ANZ....Minus 4.5%..............
HBL.......Up....71.66%.
EPS growth,ROE growth,dividend growth means HBL has had outstanding share price growth,which you have missed.
Strong organic growth has seen HBL use up their excess capital.New capital will see further growth,while ANZ has had to sell of bits to shore up their balance sheet,which means they have little or no eps growth,so there certainly will be no increased dividends.
-
12-02-2017, 07:02 PM
#8654
I reckon H1 profit will be $28.8m (they did do $14.2m in the first quarter) ..... and Jeff will say FY will be at top end of previous guidance
FY really should be over $60m but they'll manage to keep it to that $60m plus or minus a fraction - remember they always deliver on want they said they will do. Wouldn't want to go overboard would they
Last edited by winner69; 12-02-2017 at 07:05 PM.
“ At the top of every bubble, everyone is convinced it's not yet a bubble.”
-
15-02-2017, 01:31 PM
#8655
Dividend Capitalisation Valuation
Originally Posted by Snoopy
9.8c / $1.56 = 6.25% ?
Originally Posted by Xerof
Snoop dog, I was merely extracting the urine. I fudged my numbers to equate to Fridays closing price.
I thought as much. But what you did:
1/ Find a yield you are happy with.
2/ Multiply (1) by a gross dividend in cents that you choose
to obtain
3/ The share price
is a legitimate way to use the Dividend Capitalisation Valuation method. The yield that you choose is a judgement call. The dividend you use could be historical, forecast or some kind of multi-year average. So the dividend is a judgement call as well. And that means the whole valuation method is a judgement call. But there is nothing wrong with that, provided you sincerely believe that your own judgements are representative.
SNOOPY
Last edited by Snoopy; 15-02-2017 at 01:33 PM.
Watch out for the most persistent and dangerous version of Covid-19: B.S.24/7
-
15-02-2017, 01:36 PM
#8656
Originally Posted by Snoopy
Plugging in a representative yield, one that represents the ups and downs of the banking cycle of Heartland in its current form, we can now arrive at our 'Capitalised Dividend Model' valuation
(Representative Dividend per Share) / (Acceptable Yield) = Share Price (an algebraeic manipulation of: Dividend per Share / Share Price = Yield )
7.66c / 0.72 x 0.075 = $1.42
A reminder here that NTA was 91cps at balance date. This means my fair valuation is at a good premium to asset value, a credit to management from the rag tag of assets that they started with.
This $1.42 valuation is measured at the average point in the business cycle. One might argue that we are now riding high in the business cycle and that this $1.42 valuation is consequently too low given today's circumstances. I wouldn't argue with that. But, ever the bargain hound, neither would I look at buying any shares myself until that share price drifts down to that $1.42 level. Don't say that Snoopy didn't warn you!
Originally Posted by Snoopy
I should add to the above that Snoopy always likes to buy below fair value. For a bond like asset I look for a discount of 20%. So I would be looking to pick up HBL shares in the early $1.20s.
discl: do not hold HBL
I have a bit more to say about my $1.42 valuation. This will be obvious if you understand what 'business cycle average' means. But time to state the obvious.
Assuming my valuation is correct, the chances of Heartland trading at that value on any particular day is very small. If $1.42 is the average, then about half the time the share should be trading above that average and half the time the share should be trading below that average (as a general rule of thumb). Whether it trades above or below depends, where potential shareholders see Heartland going in the next couple of years in relation to the business cycle. A business cycle is not something with a smooth upward and downward progression. So it is not unusual to have lumpy share price movements over time that reflect this.
Just because I wouldn't buy Heartland today at $1.55, that doesn' t mean that I would sell it if I already owned it. For a start, Heartland is a good dividend payer. Sticking Heartland money in a 2% cash account is not a great alternative strategy. And although I regard Heartland as overvalued at present, it is not noticibly more overvalued than the rest of the market. My strategy, if I held Heartland, would be to keep holding. It would only be if the overvaluation became excessive that I would consider selling down. I would add on the upcoming dividend (3.5cps it was last year) to the fair value share price ($1.42 + 20%) and look at lightening my holding if Heartland became 20% overvalued from that figure.
That corresponds to a price of ($1.42 x 1.2) + $0.035 = $1.74
That's the figure I would be selling down from.
SNOOPY
Last edited by Snoopy; 15-02-2017 at 02:39 PM.
Reason: Change $1.585 (adj market value) to $1.42 (fair value) + div
Watch out for the most persistent and dangerous version of Covid-19: B.S.24/7
-
15-02-2017, 02:10 PM
#8657
Originally Posted by Snoopy
That corresponds to a price of $1.58.5 x 1.2 = $1.90
That's the figure...
SNOOPY
You're finally starting to see the light Snoopy. Well done.
-
15-02-2017, 02:17 PM
#8658
Hitting the Moving Target
Definitely makes sense having a sell price 20% higher than whatever the current share price is.
Though I would not complicate it by adding in the theoretical next dividend.
Best Wishes
Paper Tiger
-
15-02-2017, 02:31 PM
#8659
Originally Posted by Snoopy
I have a bit more to say about my $1.42 valuation. This will be obvious if you understand what 'business cycle average' means. But time to state the obvious.
Assuming my valuation is correct, the chances of Heartland trading at that value on any particular day is very small. If $1.42 is the average, then about half the time the share should be trading above that average and half the time the share should be trading below that average (as a general rule of thumb). Whether it trades above or below depends, where potential shareholders see Heartland going in the next couple of years in relation to the business cycle. A business cycle is not something with a smooth upward and downward progression. So it is not unusual to have lumpy share price movements over time that reflect this.
Just because I woudln't buy Heartland today $1.55, that doesn' t mean that I woudl sell it if I already owned it. For a start Heartland is a good dividend payer. Sticking Heartland money in a 2% cash account is not a great alternative strategy. And although I regard Heartland as overvalued at present, it is not noticibly more overvalued than the rest of the market. My strategy, if I held Heartland, would be to keep holding. It would only be if the overvaluation became excessive that I would consider selling down. I would add on the upcoming dividend (3.5cps it was last year) to the fair value share price ($1.42 + $0.035 = $1.45.5) and look at lightening my holding if Heartland became 20% overvalued from that figure.
That corresponds to a price of $1.45.5 x 1.2 = $1.75
That's the figure I would be selling down from.
SNOOPY
We're almost barking off the same hymn sheet. I think they're fair value at present and the divvy yield plus growth in dividend in line with growth in EPS makes them a good hold.
Ecclesiastes 11:2: “Divide your portion to seven, or even to eight, for you do not know what misfortune may occur on the earth.”
Ben Graham - In the short run the market is a voting machine but in the long run the market is a weighing machine
-
15-02-2017, 02:33 PM
#8660
Originally Posted by Paper Tiger
Definitely makes sense having a sell price 20% higher than whatever the current share price is.
Though I would not complicate it by adding in the theoretical next dividend.
Best Wishes
Paper Tiger
Sorry should have used the 'fair value share price' as a bas, not the current share price! Have corrected my post (sell down price now $1.74).
SNOOPY
Last edited by Snoopy; 15-02-2017 at 02:38 PM.
Watch out for the most persistent and dangerous version of Covid-19: B.S.24/7
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