HGH - Heartland Group Holdings

[blobbles]

I am a large holder of HNZ as I see their SP to be a bargain also (even more so when I bought most of mine at 54c!). Below NTA for a bank in one of the worlds most profitable banking markets, with good management and who is already making a growing profit which puts their SP at around $1* right now... you're mad if you don't buy them even at 70c I reckon. I think this year, if their marketing campaign is successful, they will prob top 40 million, giving them a SP in the $1.70 range but more importantly a solid divie! If they continue to perform, we could be looking at really good divies the next few years at least.

*Based on 6% return, 24 (million profit)/388 (million shares)

[mouse]

*Based on 6% return, 24 (million profit)/388 (million shares)

Which gives 6 cents per share, with a 50% dividend policy, which they could adopt, provides a 3 cent dividend. The dividend level is what will raise the share price. Plus the SP has to rise to enable HNZ to make a cash call. A Cash Call has to come to finance any expansion.

[winner69]

Which gives 6 cents per share, with a 50% dividend policy, which they could adopt, provides a 3 cent dividend. The dividend level is what will raise the share price. Plus the SP has to rise to enable HNZ to make a cash call. A Cash Call has to come to finance any expansion.

If they made 14% return on equity and didn't pay divies prob never need to raise any more cash .....double equity in 7 years ....pretty good eh

Surely reinvesting at 14% return is better than giving it back to shareholders in this early stage of growth

Why does an increased divie needed to raise the share price?

[percy]

Which gives 6 cents per share, with a 50% dividend policy, which they could adopt, provides a 3 cent dividend. The dividend level is what will raise the share price. Plus the SP has to rise to enable HNZ to make a cash call. A Cash Call has to come to finance any expansion.

With 16%
YES 16%
and I will repeat, 16% equity ratio HNZ has a huge capacity to expand without raising further cash.
You will not find an institution in Australasia with a better equity ratio.
Also profitability will add to the 16% equity ratio.
Only requirement for further funds would be if they took over F&P Finance,in which case they would most probably do a placement to institutions.

[mouse]

If they made 14% return on equity and didn't pay divies prob never need to raise any more cash .....double equity in 7 years ....pretty good eh

Surely reinvesting at 14% return is better than giving it back to shareholders in this early stage of growth
Why does an increased divie needed to raise the share price?

People buy shares for either a dividend stream, or a capital gain. The present shareholders of HNZ had a dividend stream, particularly from Pyne Gould. Maybe we have to have a new lot of shareholders who are in it for a capital gain. They of course will buy at 50 cents, as I did for the majority of my HNZ shares. But the shares allocated from Pyne still make me a bit furious. The NZ sharemarket is a bit like the Wild West. In fact, it is the wild west. Unfortunately no sign of John Wayne, nor Tonto on the horizon.

[percy]

[QUOTE=mouse;390660. But the shares allocated from Pyne still make me a bit furious. The NZ sharemarket is a bit like the Wild West. In fact, it is the wild west. Unfortunately no sign of John Wayne, nor Tonto on the horizon.[/QUOTE]

.
Bit like the sharemarket crash of 1987. Learn,get over it, and move on.
HNZ is a very good company,building a bright future for New Zealanders,borrowers,lenders and shareholders.

[mouse]

The point is, Christchurch is a bit hot. Much better to sit at the computer than riding over the range, even with Tonto. Problem Percy is that the Pyne investors, and I was one at a fairly low price, have not got over it. They are waiting to sell. Plus CBS lot want to sell and joined by the Southern Cross lot. All of this is depressing the SP. How long it will be hot for in Christchurch, or how long it will take the unwilling holders of HNZ to divest themselves of the stock is a bit unknown.

.
Bit like the sharemarket crash of 1987. Learn,get over it, and move on.
HNZ is a very good company,building a bright future for New Zealanders,borrowers,lenders and shareholders.

[percy]

The point is, Christchurch is a bit hot. Much better to sit at the computer than riding over the range, even with Tonto. Problem Percy is that the Pyne investors, and I was one at a fairly low price, have not got over it. They are waiting to sell. Plus CBS lot want to sell and joined by the Southern Cross lot. All of this is depressing the SP. How long it will be hot for in Christchurch, or how long it will take the unwilling holders of HNZ to divest themselves of the stock is a bit unknown.

Mouse,time to move on.
I am happy with HNZ share price.I am excited by their prospects.Earnings and future earnings will drive the share price.You/every one is free to buy or sell HNZ shares,depending on your/their view of the company.

[blobbles]

Which gives 6 cents per share, with a 50% dividend policy, which they could adopt, provides a 3 cent dividend. The dividend level is what will raise the share price. Plus the SP has to rise to enable HNZ to make a cash call. A Cash Call has to come to finance any expansion.

When I price a company, I generally don't do it based on what they state as their divided policy, particularly if the company is in growth phase. Imagine Apples price over the past few years if all investors did that! I assume that any money that is not handed out as divies (particularly with financial instos) will go towards bigger divies later. As others have said @16% equity they are looking pretty hot in that department already plus their stated desire to become "a regular dividend payer", what more do you want?

I am a fresh investor in the company so don't have any bad feelings of previous mischief from when they were separate instos. If those that do want to mistakenly sell their shares for less than they are worth, thats not my problem. All it means is the SP will lag behind its real value for longer than it should.

Currently HNZ is offering some damn good deposit rates. My feeling is once these are advertised strongly it will result in more deposits, more money to loan, while maintaining their good equity position and returning higher profits.

I am always the optimist however I haven't seen any convincing arguments yet to dissuade me of said optimism.

[mouse]

Blobbles, the situation that people are not only thinking of selling below the assett backing of their shares, but are doing it in droves, is holding down the price. I think that anyone going in now will do well. At 50 cents investors got the shares at half price to assett backing. What we are seeing is an irrational reaction to past problems. So I actually think Percy is totally correct in his postings. However, he does not look like Tonto and may not even be able to ride a horse.