OCA - Oceania Group - retirement villages

[winner69]

Attachment 12038

I have no further comment on the attached charts, have you say. I have not updated OCA debt ratio after new bond issued yet.

Price surge due to event driven (new bond issued) or fundamental improvement?

All those profit ratios will fix themselves when they stop knocking things down (writing them off) and rebuilding as super cash cows

[Beagle]

So I will continue to hold OCA on the belief that I will receive a modest but growing dividend accompanied by an erratic but growing share price until one day they are worth enough to buy a shed.

No need to get your fur all matted up sour puss. Here's an idea just for a refreshing change. Seeing as you seem to claim to understand the accounts so well what about posting some truly insightful analysis rather than your usual pithy barbs.

[peat]

FCF = OCF - CAPEX
FCF = real money that can be given back to you as true profits.

there will certainly be a few nuaces around this tho...

[Beagle]

I think sour puss knows full well that they're investing heaps in capex for future growth.

[Waltzing]

other comprehensive income item in the P&L does not appear to have a note ?

ok schedule found thanks.

[Snow Leopard]

No need to get your fur all matted up sour puss. Here's an idea just for a refreshing change. Seeing as you seem to claim to understand the accounts so well what about posting some truly insightful analysis rather than your usual pithy barbs.

Todays Calvin & Hobbes

[Maverick]

After Beagles comment on where the brokers might redirect the MET money. I believe that his quick comment was prescient and worthy of further consideration.

$1.4B MET is showing up in peoples bank accounts on the 3 November, no doubt what so ever.
Where is that free capital likely to flow? It will almost certainly be highly influenced by the recommendations to Jo public and institutions by the brokers, these recommendations all being based on the analysts reports. I checked out 4 traders' summary of analysts opinions on all the NZ retirement operators as suitors.

In a scale of 1-10 (1 sell-10 buy)- Worth noting SUM and OCA have only recently been strongly upgraded, the RYM and ARV have remained unchanged for some time.
RYM 4
ARV 4
SUM10
OCA 10.

If $1.4B was all fully redeployed back into the sector on a pro-rata basis OCA would receive about 7.5% =$110m .
Obviously it won't all go back into the sector. However it would seem reasonable OCA and SUM will get more share than RYM or ARV of what is. You can actually already see the sway of the recent changing analysts opinion working through the SP charts on these 4 companies. Over the 2-3 weeks since the upgrades have shifted SUM and OCA up and RYM and ARV down. (all this without the influence of the impending wall of cash yet in play).

The new money heading to OCA will start flowing almost immediately upon arrival and then quickly over fairly short time frame. ( This is over a 1/3rd of the size of the massively disruptive MAQ sell down of $300m earlier this year) but this time around its buying pressure as opposed to selling/dumping pressure. All long term OCA holders here know full well how long the tails of both MAQ sell downs lingered over the share price.

One thing I've learnt the hard way this year is how powerful the supply/demand relationship is on a share price and how it absolutely trumps any company fundamentals. (think OCA at $0.38 cents.)

So, based on this, it would be reasonable to assume some sort of similar opposite an, this time, a positive effect of buying pressure that should easily last until the HY1 report comes out in late Jan 2021.

Now onto the fundamentals of OCA, ...It is well documented here that I am expecting a substantial profit rise in HY1, well ahead of the analysts forecasts.

So these 2 immediate events lined up amongst the frothy general NZ property situation is all getting rather exciting, simply;

Scenario 1. a wall of money likely to boost the OCA share price followed up by a (IMO) substantial profit upgrade. Share price therefore heads towards $2.00 early-mid 2021

Scenario 2. If I “crash and burn '' and OCA only produce profit as per the analysts lowly expectations. (BTW, I`m not doubting my math's but it would be foolish not to at least consider it.) Then the share price will settle back down to about where its is now at $1.40 after the new cash injection works through. Around the mid-point of both brokers recent upgrades.

Not very often a nice opportunity like this comes along with very little downside risk,
“ Heads you win , tails you at least get your money back.”

[Waltzing]

expect some of it to head into commercial property stocks. KPG experienced increased demand this last week. I would not be surprised to see GMT and ARG also increase in demand and perhaps the Generator stocks.

Dont expect much but you might see some head to the likes of SKC.

and ATM might get a look if it drops farther.

[winner69]

How much of MET owned by overseas entities .....and will they desert NZ

What’s that London based outfit Omni Partners been up taking 10% over the last few weeks?

Wouldn’t most of that ‘cash’ already found a home?

[Beagle]

After Beagles comment on where the brokers might redirect the MET money. I believe that his quick comment was prescient and worthy of further consideration.

$1.4B MET is showing up in peoples bank accounts on the 3 November, no doubt what so ever.
Where is that free capital likely to flow? It will almost certainly be highly influenced by the recommendations to Jo public and institutions by the brokers, these recommendations all being based on the analysts reports. I checked out 4 traders' summary of analysts opinions on all the NZ retirement operators as suitors.

In a scale of 1-10 (1 sell-10 buy)- Worth noting SUM and OCA have only recently been strongly upgraded, the RYM and ARV have remained unchanged for some time.
RYM 4
ARV 4
SUM10
OCA 10.

If $1.4B was all fully redeployed back into the sector on a pro-rata basis OCA would receive about 7.5% =$110m .
Obviously it won't all go back into the sector. However it would seem reasonable OCA and SUM will get more share than RYM or ARV of what is. You can actually already see the sway of the recent changing analysts opinion working through the SP charts on these 4 companies. Over the 2-3 weeks since the upgrades have shifted SUM and OCA up and RYM and ARV down. (all this without the influence of the impending wall of cash yet in play).

The new money heading to OCA will start flowing almost immediately upon arrival and then quickly over fairly short time frame. ( This is over a 1/3rd of the size of the massively disruptive MAQ sell down of $300m earlier this year) but this time around its buying pressure as opposed to selling/dumping pressure. All long term OCA holders here know full well how long the tails of both MAQ sell downs lingered over the share price.

One thing I've learnt the hard way this year is how powerful the supply/demand relationship is on a share price and how it absolutely trumps any company fundamentals. (think OCA at $0.38 cents.)

So, based on this, it would be reasonable to assume some sort of similar opposite an, this time, a positive effect of buying pressure that should easily last until the HY1 report comes out in late Jan 2021.

Now onto the fundamentals of OCA, ...It is well documented here that I am expecting a substantial profit rise in HY1 This should equate to about 50% greater than the 2 recent analyst reports expectations of about 49m annualized underlying profit ( similar to the last 4 years excluding covid costs ).

So these 2 immediate events lined up amongst the frothy general NZ property situation is all getting rather exciting, simply;

Scenario 1. a wall of money likely to boost the OCA share price followed up by a (IMO) substantial profit upgrade. Share price therefore heads towards $2.00 early-mid 2021

Scenario 2. If I “crash and burn '' and OCA only produce profit as per the analysts lowly expectations. (BTW, I`m not doubting my math's but it would be foolish not to at least consider it.) Then the share price will settle back down to about where its is now at $1.40 after the new cash injection works through. Around the mid-point of both brokers recent upgrades.

Not very often a nice opportunity like this comes along with very little downside risk,
“ Heads you win , tails you at least get your money back.”

Good post as always mate. I see profit climbing in the years ahead just like the brokers do but off a base of 10 cps for the 10 months, (annualized 12 cps) rather than the 8 cps that Forsyth Barr has with their $1.65 price target. The interesting thing is that if I am right then rejigging all other numbers in their DCF for a 50% higher starting point and using the same growth rate then the price target must be $1.65 x 1.5 = $2.475. I think this has $2 written all over it in 2021 but if its not until 2022 then so be it, what do I care, its a 5 year hold as an absolute minimum, more likely 10 years+.

In terms of how much MET money gets reallocated to OCA, absolutely some of it will head offshore to the hedge funds never to be seen again and most will head off to other stocks, probably with a property and retirement sector bias but you're quite right that some of it is likely to find its was to OCA which is at least a partial type of opposite effect that the Macquarie sell down had.

Demand and supply is such a massive factor and the property market sentiment is extremely favorable. As you quite rightly suggest the broker community just recently getting behind this stock will definitely have a positive effect...institutions and wealthy private and wealth management client investors listen to those guys not you and I.

I believe if I am not mistaken Friday's close at $1.40 was a fresh high in terms of closing price. I'm feeling very confident about OCA prospects going forward. I always said with this one I thought the half way transition / point of inflection would be a great time to invest and I think we're really going to get some deep satisfaction seeing OCA coming of age over the next few years.

I hope I can talk Mrs Beagle into putting some of her trust money into OCA. Big property settlement on Tuesday for her so maybe the Beagle's will be double dipping on OCA profits in the future....that would be very nice (She does her thing with property and I do my thing with shares and we just get on with it and very seldom compare notes...a lot less arguments that way too lol).