OCA - Oceania Group - retirement villages

[Snow Leopard]

...What a LEGEND of this sector Couta1 is...hope he comes back one day....I am working on encouraging him.

What did happen to him?

[Maverick]

The average up to last year was 10 OCA = 1 RYM ...but if you use the who duration since IPO to now its over 11. But 10 is a nice round number so Couts is spot on.

Yep in relative terms OCA is so cheap it’s not funny. Spooky it’s got worse since Macca sold out.

But again mr beagle you never try to address why does OCA (and MET) always appear to be so so cheap.

Anyway just for you

Ohh...ohh...ohh Winner, can I answer this one?

I see Beagle has since given a very solid response to your question, I've got my own ideas to add to his well articulated reply(on OCA)
Very simply …..OCAs model is just too complex for most to undertake the behemoth task of working it out . The only other person I'm aware of who has tried to mathematically project the whole pipeline to completion is Mogul, and it's an intense task.
That means for everyone else to either “believe the story “ as you nicely put it Winner, or just look at the bottom line annual underlying profits... (This includes analysts IMO.)
“Believing the story” doesn't cut it when the share price tanks like it did, many investing on that unsubstantiated “nice idea” would have sold in horror while watching the share price turn into a nightmare...sell..sell.
On the other hand, those looking at the underlying profit will be thinking this is a no growth company now also thwart with horrid covid and property risks...sell..sell.
Overwhelming and overshadowing all this is the massive oversupply from MAQ recently flooding the market, as Beagle quite rightly points out. So any of the above selling goes out to a fully saturated market of OCA. Supply and demand 101.
Chuck in….margin calls , kiwi saver switching, Sharesies…..BOOM $.38 cents.

That's well behind us now , so what's next?

As you know Winner, I'm picking 50-54m underlying profit next month. That compares to the last 2 years which were also circa 50m.

That is hardly a headline grabbing new result but based on P/E fundamentals alone the share price deserves to be around $1.20 - $1.30.( BTW , exactly matching the Coutta relativity theory ).

However , there will be a number of astute’s out there that will see this profit increase, albeit small, has been achieved during the full covid L4+L3 / end of the world experience. Therefore 10.5/ 12 months of a normal trading year.
Accordingly, I see a base SP of $1.20 but PLENTY of scope for higher.

What's changed in the last 1 month?
The long term trepidation of MAQ overhang is fully behind us.
The swamping of their 300m shares appears now fully assimilated.
Covid is behind us.
Property Hasn't fallen of a cliff to date,
Govt policy's underpin property prices
NZ is the global place to be. Crikey , I think even Snow leopard wants to be here

In 7 weeks we will have some actual real OCA numbers to work with but for now , with what we do know , it is very easy to justify the sp rising , obviously not in a straight line, to $1.20- $1.30

At this point in time, I have no reason to change any assumptions in my long term projections which is annual growth of underlying earnings increasing about 20%-22% p/a for the next eight years.

[Beagle]

What did happen to him?

Coutts just decided to take a break for a while...and then he found it very peaceful in Siberia, so peaceful I think he's taking a real liking to the place.
He adds real value with his insights into this sector and the forum is the poorer for his self exile. We usually chat on the phone once or twice a week...from time to time I remind him he's missed on here. Maybe one day he will come in from the cold...

Great Post Maverick. I REALLY like your last paragraph !

[tommy_d]

That is hardly a headline grabbing new result but based on P/E fundamentals alone the share price deserves to be around $1.20 - $1.30.( BTW , exactly matching the Coutta relativity theory ).

i'm concerned that your post might result in me buying more, but i'm enjoying having my average price per share down in the 70s....

[Cyclical]

i'm concerned that your post might result in me buying more, but i'm enjoying having my average price per share down in the 70s....

In the same boat tommy_d. And in my case, one might suggest too many eggs in one basket. But it’s very tempting, because at least this one has sound fundamentals and imo isn’t overpriced, unlike a lot of other stocks out there atm.

[Beagle]

In the same boat tommy_d. And in my case, one might suggest too many eggs in one basket. But it’s very tempting, because at least this one has sound fundamentals and imo isn’t overpriced, unlike a lot of other stocks out there atm.

I feel the same way. I still have far too much cash from my February market sell-down and its getting really hard to find good stocks at sensible prices. The rally on the US markets overnight will probably further compound the problem here on Monday and further widen the disconnect between the market and the underlying economy. Thankfully some stocks are still a haven from the almost all pervasive irrationality that's sweeping the markets.

I'm feeling I need more of these as the returns on cash and short term deposits are now probably negative after tax and inflation.

[winner69]

I just love it when the true Oceania believers and the newcomers who only bought a cheap ticker code a month or so ago have a mutual feel good session and give each other lots of hugs and cuddles (figuratively these days) and espouse the gospel according to St Earl.

Sort of gives me some comfort that I need to hang in there and maybe even top up. Hopefully one day the dreams of many will burst into reality ....it’s only hope that keeps me in.

Disc: I’m not a believer. I can’t warm to St Earl. Does that make me a heathen

[Mufasa]

I just love it when the true Oceania believers and the newcomers who only bought a cheap ticker code a month or so ago have a mutual feel good session and give each other lots of hugs and cuddles (figuratively these days) and espouse the gospel according to St Earl.

Sort of gives me some comfort that I need to hang in there and maybe even top up. Hopefully one day the dreams of many will burst into reality ....it’s only hope that keeps me in.

Disc: I’m not a believer. I can’t warm to St Earl. Does that make me a heathen

Agree in part. Am a proud purchaser of OCA at IPO and have ridden the lumpy swell that it became in March, but truly believe it is on the up from here. Do I think there will be another crash? Yes I do, but I believe this time OCA will be more resilient to it than last time due to the fact that the drop off the cliff in march was out of fear on what could happen to a village if the Rona got in. This time it would be a crash based off genuine economics and to me, OCA is in a good cash position. Plus investors will look at the rebound OCA had last time and think "well it will come back, I am happy to hold and not sell off". As I say I agree with your above statement - it wad the same with A2M, a lot of hard times and patience required but now suddenly everybody who came into A2M at $2 or $3 is an expert in investing. What about the ones of us who rode the 50cents to $1 years? Such is the world though

[Beagle]

Maybe if you met him in person like some of us on here have...
"Hopefully one day the dreams of many will burst into reality". The good book says not to skite so its best if I don't post how much I am already up on this one....besides, I bought for the dividend income anyway.

TSB want to roll over my 90 day term deposit for another 90 days in the next ten days. 80 days ago the rate was 2.0%, now its 1.05%. Hmmm, thanks, but no thanks. I can still get over 5+% here plus growth in the years ahead.

[winner69]

Maybe if you met him in person like some of us on here have...
"Hopefully one day the dreams of many will burst into reality". The good book says not to skite so its best if I don't post how much I am already up on this one....besides, I bought for the dividend income anyway.

TSB want to roll over my 90 day term deposit for another 90 days in the next ten days. 80 days ago the rate was 2.0%, now its 1.05%. Hmmm, thanks, but no thanks. I can still get over 5+% here plus growth in the years ahead.

Probably made zillions when you bought back into Oceania in the 40’s and 50’s and 60’s.

As you bailed from Oceania once before I’d hazard a guess it was you couldn’t resist buying something ‘cheap’ rather than anything that Earl had done.

Anyway glad we’re both on the right side of the ledger