OCA - Oceania Group - retirement villages

[allfromacell]

Backing the truck up here, these will double from here on the recovery.

[dabsman]

Backing the truck up here, these will double from here on the recovery.

Yes but how much further down? I sold all at $1.08 so I want to put all those funds back into OCA but very very uncertain when to jump back in

[youngatheart]

Heads of retirement companies meeting today. Hopefully this will result in a positive story that'll push up the SP...

[Rossimarnz]

Yes but how much further down? I sold all at $1.08 so I want to put all those funds back into OCA but very very uncertain when to jump back in

I did much the same. At this point I will not be re-investing until there has been an outbreak in a retirement home as I think this needs to happen before the share price recovery can begin in earnest. Please note that I am not wishing this on anyone I just think it will happen at some stage.

[BlackPeter]

Another reasonably well researched retirement village, and share price currently in a deep COVID-19 hole, though just bouncing up. Current analysts consensus is $1.24 per share. But before we get too excited - lets see how good analysts predictions have been in the past for this stock - shall we?

In February 2019 the OCA share price peaked at $1.10. At that stage the combined mental power of 4 share market analysts forecasted that over the 12 months to February 2020 the OCA shareprice will slightly rise to $1.18 (consensus), i.e. they predicted a roughly 7% share price increase.

OCA actually peaked in February at $1.24, i.e. the prediction was 5% below that value which is according to the rules still a PASS.

Looking into the consensus buy recommendation - it was in February 2019 a straight "OUTPERFORM"(7.5/10) - i.e. analysts said that the share will outperform the NZX. NZX 50 went up by 21% and OCA went up by only 13%, i.e. OCA underperformed the NZX50. Analysts have been wrong with this recommendation, majority of stocks did better - a clear "FAIL"

I am doing this exercise as well with other NZX listed stocks - the overview is here:
https://www.sharetrader.co.nz/showth...arket-analysts

17 stock forecasts checked so far (checking for each consensus and buy recommendation);
Consensus share price forecasts correct: 4/17; analysts hitrate: 23.5%
Consensus recommendation vs NZX50 correct: 5/17; analysts hitrate: 29.4%

[trader_jackson]

OCA exactly 4 weeks ago was $1.23, OCA's NAV is $1.14, OCA's NTA is $1.01, OCA's IPO was 79 cents (nearly exactly 3 years ago), the lowest prior to today was 78 cents... OCA's share price is now 68 cents

I agree with the above around the fear and subsequent stigma around an outbreak at one of their facilities/locations, but OCA is trading at a discount of 33% - this is the largest discount of all the retirement operators (basically as large as MET's was - prior to the takeover), and probably any and all property related stocks on the NZX

I believe their NTA is largely supported by residential property (not commercial or retail office space, which I do believe could be in for a rougher time than residential property)... could it be that Mr Market pricing a fall in residential property of 33%? [if that is the case, the banks have ALOT to worry about! far more than they did during the GFC or 1987 or any other time in NZ history basically!] Or is OCA not telling us something?

I'm topping up

Not surprising to see OCA booming today - 60c was just getting stupid really.
It doesn't have anywhere near the same issues as MET (in terms of their buildings possibly requiring huge remediation, hence a sizable discount should be applied to NTA regardless of the virus)

[Maverick]

I thought it proper to post where I'm at with OCA since I've been such an strong advocate and have recently gone very quiet.


Basically I stopped reading sharetrader the last month as the analysis and well thought out opinions have swapped out for overwhelming talk of Armageddon . This has not been personally helpful while I try to get a perspective on this thing without being highjacked by a wave of a panic feeling every 30 minutes.(maybe that's 10 minutes if I'm looking at the “stuff” and share price too!)


What I've decided for myself (after discussions with senior DHB staff, and village operators)…..
-I completely disagree with the current market sentiment that rest homes are the worst place for elderly to be. I think the market has this 100 % wrong.(Just A Kiwi‘s ST posts give great insight of the heartfelt care that happens within the walls to protect the clients, thank you for posting ) .
-Villages already have good strategies in place, they can lock down in a moment. All understand,as it really is life and death.
-The oldies don't have to fret about going out into the world of terror to hoard toilet paper.
-They also have “bought” with their DMFs, a nurse that they might not get if they rocked up to the local DHB with a cough.
-Plus they are with their “own kind” as opposed to sharing the outside world with some of the dumbass*s out there are not willing or capable of considering other people's potential deaths.

So I've concluded the fear priced in by investors of an outbreak routing through villages is misguided. I anticipate that rest homes will soon be seen as safe zones, Noah's arks if you will.


Financially, OCA’s story is a future story currently only at an earlier stage. Profits will be reaped increasingly in the 6 months to 7 years ahead from what is only being built now. So we can keep on building and worry about filling them long after the virus has become " too boring to talk about."


Will we run out of old people wanting to live in a village ? Will property collapse?
No and no, just maybe, it will soften but it will be slight and short term.


I'm continuing to hold expecting good dividends going forward and very confident in OCA’s balance sheet, directors, management and staff to keep the project moving forward as planned.


All the while our clients can continue to live in the safe environment they are paying us handsomely for while some others will watch with envy that they wish they could be in one too.


I know others will have quite different opinions( and the market agrees with you for now). Just letting you know where I'm at if interested

[percy]

Excellent post.

Not allowed to add to your reputation.
Must spread it around.
Yeah Right,but who.????????????..............lol.

[Blue Skies]

Thanks Maverick, great post.
I'm a long term holder too with at least a 10 year time frame. Sentiment is a funny thing, look at FPH initially dropping hard but now flying!

The people I know in villages feel far safer with a skilled & caring moat around them & freely available nursing care than if they were in their own homes by themselves trying to cope with the risks of transmission while shopping, visits to the chemist & GP, home maintenance people etc .

[Bjauck]

...
-I completely disagree with the current market sentiment that rest homes are the worst place for elderly to be. I think the market has this 100 % wrong.(Just A Kiwi‘s ST posts give great insight of the heartfelt care that happens within the walls to protect the clients, thank you for posting ) .
-Villages already have good strategies in place, can lock down in a moment. All understands as it really is life and death. ....

Thanks for your research and post. I have come to the same conclusion too. I have been impressed with the efforts that my local village has already undertaken to ensure that the village and facilities are safer zones.