OCA - Oceania Group - retirement villages

[winner69]

If they issue stock for cash at current prices while paying out cash as a dividend then they need hanging drawing and quartering. That would be the most unbelievably stupid thing to do.

Over the last few years they have raised about $130m of new capital while paying about $130m in divies

Many people say that hasn't been stupid and praise the financial awareness of OCA management

[Antipodean]

Suspension of dividend would be more prudent if there is a need for it.

[SailorRob]

Over the last few years they have raised about $130m of new capital while paying about $130m in divies

Many people say that hasn't been stupid and praise the financial awareness of OCA management

I can tell you right now that there is no praise for the financial awareness in this comment.

Sometimes raising equity capital and paying dividends is by far the smartest thing that a company can do.

Sometimes raising equity is massively value destructive and paying dividends at the same time doubles the stupidity.

Sometimes buying back shares is the smartest thing a company can do.

Sometimes canceling the dividend and using the cash saved to buy back shares is very clever.


Now I wonder what can make all of these 'sometimes' only?


If your house market value drops from 1 million to 100k, do you start selling pieces of your house at the 100k valuation to pay the power bill, or should you have sold a bit of it at the 1 million value?

[bull....]

If they issue stock for cash at current prices while paying out cash as a dividend then they need hanging drawing and quartering. That would be the most unbelievably stupid thing to do.

lol ryman comes to mind.
Ive always been in the camp oca will stop paying a div at some stage and for that matter reduced div's in the whole sector will probably occur.

not so good from a compounding point of view when a div stops

[SailorRob]

lol ryman comes to mind.
Ive always been in the camp oca will stop paying a div at some stage and for that matter reduced div's in the whole sector will probably occur.

not so good from a compounding point of view when a div stops

Wrong.

It's exactly the opposite.

It's far far better from a compounding point of view.

Reinvesting in businesses is how compounding works. Not by paying earnings out.

[bull....]

Wrong.

It's exactly the opposite.

It's far far better from a compounding point of view.

Reinvesting in businesses is how compounding works. Not by paying earnings out.

sure but we are talking about OCA here and if OCA stop's paying a div that would suggest they are not re-investing for growth but trying to stay alive.
therefore it is not good from a compounding point of view as most likely the share will go much lower when div stops so any gains you have made previous period's will be wiped out.

[limmy]

sure but we are talking about OCA here and if OCA stop's paying a div that would suggest they are not re-investing for growth but trying to stay alive.
therefore it is not good from a compounding point of view as most likely the share will go much lower when div stops so any gains you have made previous period's will be wiped out.

Yes, many buy OCA because of its high dividend yield.

[SailorRob]

sure but we are talking about OCA here and if OCA stop's paying a div that would suggest they are not re-investing for growth but trying to stay alive.
therefore it is not good from a compounding point of view as most likely the share will go much lower when div stops so any gains you have made previous period's will be wiped out.

Yep that's fair, I was strictly talking about business compounding not stock price, but one in same over long term. But agree with your thinking.

[peat]

The sharp fall during February has made RSI go even lower than before almost reaching zero now. so that's telling us zero strength, and there are no signs of RSI divergence. (often shown before a turning point)

OCA20230306.JPG
not much to cling to at this point for signs of a turnaround.

I still hold the same amount I have for ages. very much in the red - no intention of selling, or buying more .
so i feel your pain OCA, and look forward to the return of rising property prices and falling interest rates.

[Baa_Baa]

The sharp fall during February has made RSI go even lower than before almost reaching zero now. so that's telling us zero strength, and there are no signs of RSI divergence. (often shown before a turning point)

OCA20230306.JPG
not much to cling to at this point for signs of a turnaround.

I still hold the same amount I have for ages. very much in the red - no intention of selling, or buying more .
so i feel your pain OCA, and look forward to the return of rising property prices and falling interest rates.

I'm buying more, yeah, I have a lot already (relatively), managed to get my average down. But before the diversification and balanced portfolio police come and get me, I'm more than happy to take advantage of such discounts to NTA while still getting a modest dividend which I take as more shares in the DRP. Long term.

We've had a very long time of very little value opportunities in the market, years if you reflect on it, then despite how quickly this has come about, we have value everywhere. The challenge is really only deciding where the value is, and when to get into it.

I'm not waiting anymore, but my entries/accumulations are smaller and spread over a longer timeframe. Currently less than 50% invested, but that's because of two things, my stocks have been hammered, and I have built up a war chest greater than 50% of portfolio, which will deploy when I want to.

Such a massive change in the market in such a short time, this is a decade opportunity, I'm not going to miss being part of it.