MPG - Metro Glass

[Brain]

What lesson did you learn nomis? What is the thing you won't do again? What will help me identify the next MPG?[/QUOTE]

No lessons to be learnt from this. The next MPG will take some other form and catch investors out once again. We investors do not have a complete understanding of companies, irrespective of how diligently we read annual reports and the business news. A lot of directors and management come to work to eat their lunch and some of them are totally incompetent and it takes time for investors to work that out. Those that we recognise to be incompetent will be replaced by new directors or management which also may be incompetent. Fortunately we have been in a bull market for many years and it has been easy to make money. The dice have been loaded heavily in our favour. Now when the bear arrives (if it hasn’t already) the going will get very tough.

[Baa_Baa]

What lesson did you learn nomis? What is the thing you won't do again? What will help me identify the next MPG?

No lessons to be learnt from this.

How about:

1. If you have even a tiny bit of doubt with an IPO (and there was plenty of doubt here), but still want to buy it for some reason, buy with a stop loss at, or a tiny-ridiculously-close% below your IPO entry.

2. Refer to 1.

3. Monitor it very closely in the first few weeks or so, in case you're wrong.

In this case and some others, you'd be right.

[Brain]

How about:

1. If you have even a tiny bit of doubt with an IPO (and there was plenty of doubt here), but still want to buy it for some reason, buy with a stop loss at, or a tiny-ridiculously-close% below your IPO entry.

2. Refer to 1.

3. Monitor it very closely in the first few weeks or so, in case you're wrong.

In this case and some others, you'd be right.

I think it would be fair to say you would miss out on a lot of opportunities with that methodology. IPOs and doubt go hand in hand and a lot of them trade under issue price. Some are successful some are not.

[BlackPeter]

How about:

1. If you have even a tiny bit of doubt with an IPO (and there was plenty of doubt here), but still want to buy it for some reason, buy with a stop loss at, or a tiny-ridiculously-close% below your IPO entry.

2. Refer to 1.

3. Monitor it very closely in the first few weeks or so, in case you're wrong.

In this case and some others, you'd be right.

Good advise, however does not work every time - your investment still can easily turn to custard (i.e. use plenty of diversification as well).

Examples:
1) I used to have a stop loss for my (at that stage still smallish) MPG holding slightly below the MA200 - but the share price just did "fall through" at announcement time. Next time I looked the price was something like 30 cents below my stop loss and the stop loss not even triggered. Admittedly - with the benefit of hindsight I still should have sold at that stage, but this is another story.

2) I do have (for ages) a stop loss for CBL (currently in suspension). Just wondering what good it will do for me when they start trading again ...

So, yes - by all means use stop losses (they can be a good safety device), but just make sure you don't trust too much into them - they are not foolproof ;

[carrom74]

"We have also had a situation where we have had a significant building boom," he said, adding that this was often the most dangerous time for a building business, "worse than a bust because it puts stress on subcontractors, services and the like"-----Sir Ralph on FBU's losses...

Applies to MPG too...

[Onion]

"We have also had a situation where we have had a significant building boom," he said, adding that this was often the most dangerous time for a building business, "worse than a bust because it puts stress on subcontractors, services and the like"-----Sir Ralph on FBU's losses...

Applies to MPG too...

"Worse than a bust ..." - Bulls...!

I don't believe that businesses are better off in a bust than a boom. There may well be subcontractor problems that arise but surely a company like MPG is better off bidding for business when there is plenty going on than struggling in a quiet time.

FBU didn't need to win every project going.

Both FBU and MPG have an option (actually an obligation to shareholders) of not accepting business that doesn't make money.

[winner69]

"Worse than a bust ..." - Bulls...!

I don't believe that businesses are better off in a bust than a boom. There may well be subcontractor problems that arise but surely a company like MPG is better off bidding for business when there is plenty going on than struggling in a quiet time.

FBU didn't need to win every project going.

Both FBU and MPG have an option (actually an obligation to shareholders) of not accepting business that doesn't make money.

‘Obligation’ to shareholders in not accepting business that doesn’t make money ...fair enough in an ideal world.

But one of the key drivers of even looking at this work (will make a profit in theory of course) is that the same greedy shareholders implore / demand the company grows or else they will be punished. Some might say without those shareholder demands they would take a more considered view.

[RTM]

‘Obligation’ to shareholders in not accepting business that doesn’t make money ...fair enough in an ideal world.

But one of the key drivers of even looking at this work (will make a profit in theory of course) is that the same greedy shareholders implore / demand the company grows or else they will be punished. Some might say without those shareholder demands they would take a more considered view.

That may be the case Winner, but then doesn’t it come down to the calibre of the Directors to make sure that appropriately prudent decisions are made ? I recall a year or so ago Raz (I think) questioning the calibre of NZ Directors, compared with what he had seen overseas...(USA?). This shimozzel with FBU is really very embarrassing all around for NZ. I f you head down that track, add in the problems with NZX holding companies or attracting new high quality ones, then really, why would you invest in NZ ? It’s certainly making me assess very carefully where any new investment money is going to go.
Disc. Not holding. Sold on one of the earlier warnings.

[JeremyALD]

85 cents! Now half of the IPO price.

People must have very gloomy views of MPG. Its worth about 150m even though they are tracking for 18m to 20m profit at a minimum this year. Are they really that bad a business?

[winner69]

85 cents! Now half of the IPO price.

People must have very gloomy views of MPG. Its worth about 150m even though they are tracking for 18m to 20m profit at a minimum this year. Are they really that bad a business?

Not tempted to give them another chance are we?

Punters probably think they have some Fletcher-esque ghosts in the cupboard. Apparently they have a few largish fixed price contracts as well.

Looking forward there probably going to be a bit of a hiatus in ‘above ground’ commercial construction as Fletcher’s wind down. That could inhibit Metro growth.

We said a buck was the bottom ....then 90 cents .....maybe it’s 80 cents now ...who knows

Think there will a trading update soon to put the market at ease?