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  1. #5901
    Turn and burn Maverick's Avatar
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    Quote Originally Posted by Beagle View Post
    OCA's care as a percentage of its business model is much higher than Arvida's and OCA reports for the period ended 31 May 2020 which encapsulates the full period of the lockdown and its effects in March, April and May, before we emerged from lockdown in early June. Importantly care suites were deemed an essential service throughout the lockdown.

    Taking into account both direct costs and lost profit from inability to sell independent living units, I remain comfortable with my earlier assessment of overall effect $10-15m and nothing in the Arvida analysis has surprised me or caused me to amend my best guess. Importantly we did emerge to level 2 lockdown late in May which will have enabled some independent units to settle before balance date. What I have not accounted for is the slowdown in construction caused by Covid 19.

    I remain very cautious about expectations regarding this years underlying profit but its this very thing of a high percentage of care that fills me with so much enthusiasm for the long run as they build heaps more care suites and they churn them every 2-3 years there is such excellent potential for profit growth down the track. This is a long term investment and my caution is those hoping for a quick buck could find themselves frustrated in the short term.

    Disc: Holding long term for yield that will grow nicely over the long run.
    Thanks fellas for that info on ARV`s covid costs.
    So to complete the puzzle from a few posts back I`m seeing an underlying profit of $53 minus covid costs (lets say 40% bigger than ARV because of all the PPE needed for the OCA care suits =4m ) , therefore an underlying of about $49 .
    That`s ever slightly down on last year despite going through the full covid experience.

    I`m more optimistic than you Beagle so well see soon enough who owes who a beer.

    As far as construction holdup, I`m not seeing that as a biggie. We know it was 'tools down' for only 6 weeks. Without doubt some behind the scenes stuff still got done during lock down too. BTW OCA received about 2 million on the wage subsidy.

    I fully agree with you though Beagle that this is no get rich quick thing. The Sharsies guys might get a bit bored with this one and have to keep playing with Cannasouth and AIR etc , but for the rest of us who actually "invest" then this is still looking a most fabulous company to me.
    Last edited by Maverick; 04-07-2020 at 04:39 PM.

  2. #5902
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    I look forward to hearing from MR B and other experts on OCA as the business of health care progresses and many thanks for there public spirit to communicate to investors.

  3. #5903
    Senior Member King1212's Avatar
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    On one news couple minutes ago...houses sold like a hot cake..kiwi expert returned home...all bought houses.

    100k resident visa applications waiting list from riches Americans n English....wanting to move to NZ...bring thier wealth to start business n invest because NZ is a safe haven

    So... expecting our assests n shares price kept going up....

  4. #5904
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    Maybe, maybe not

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  5. #5905
    Senior Member King1212's Avatar
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    Thats kiwis ehh JT....during property boom...they all increased thier loans....for holidays....new kitchen...spa pool...new cars...new toys...not sex toy....such as boats..caravans....

    Now..they are in trouble. Well....let the experts buy thier house.

    Or....the 100k wealthy Americans and UK will buy thier houses

  6. #5906
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    Quote Originally Posted by winner69 View Post
    Good stuff ...how did day 2 go.

    Is a good approach.

    Keep us up to date.
    OK, here it goes....I've completed my first iteration of valuation based on residual income.

    Assuming:
    - cost of capital (equity) at 10.7%
    - cost of operations is 7.4%
    - perpetual growth of residual income from 2025 at 2-3%
    - Value per share is $1.77- $1.90

    Total PV of the ReOI is $114m and PV of continuing value is $440m.

    Once the full year results are out, I'll adjust it a tad.

    Welcome any feedback.

    thanks

    Disc: I now hold a few shares and will be buying more.
    Last edited by Paradox; 04-07-2020 at 07:57 PM.

  7. #5907
    Senior Member King1212's Avatar
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    No doubts..the SP will be double in the next couple years...

    If it was not a covid around....SP would be $1.30 easily

  8. #5908
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    "100k resident visa applications "

    is this a fact and over what time period might this new expected horde arrive. A new migration from the north east and north west.

    they wont get them processed this year.

    Canada expecting immigration from Hong Kong. Some coming here?
    Last edited by Waltzingironmansinlgescul; 04-07-2020 at 10:25 PM.

  9. #5909
    CEO Butch Analytics Ltd winner69's Avatar
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    Quote Originally Posted by King1212 View Post
    Thats kiwis ehh JT....during property boom...they all increased thier loans....for holidays....new kitchen...spa pool...new cars...new toys...not sex toy....such as boats..caravans....

    Now..they are in trouble. Well....let the experts buy thier house.

    Or....the 100k wealthy Americans and UK will buy thier houses
    Hey kingi. ...that 100k plus is in addition to the hundreds of thousands of rich kiwis coming back home ...good eh

    Good for a year or so but big trouble ahead when they all realise NZ isn’t the promised land after all and they all sell up and leave
    “Just consider that maybe the probability of you being wrong is higher than you think.”

  10. #5910
    Senior Member King1212's Avatar
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    Short term...yes... assests will kept going up.

    Regarding jobs.....the government needs to be smart.... close the overseas migrant tap.. concentrate to returning kiwis...

    Saying that.....baby boomers are all starting to retire.....so.... job vacancy will be filled by these returning kiwis

  11. #5911
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    what winner? They will leave? A buying or renting spike about to restart the housing bubble or they will buy at low interest rates and rejoin the global economy when the smoke clears renting out there new properties. All in all good for the over all property market. Boom in 10 year time? Average price in the golden T 1 million inside 10 years? SUM companies back in business big time?

  12. #5912
    ShareTrader Legend Beagle's Avatar
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    Quote Originally Posted by Paradox View Post
    OK, here it goes....I've completed my first iteration of valuation based on residual income.

    Assuming:
    - cost of capital (equity) at 10.7%
    - cost of operations is 7.4%
    - perpetual growth of residual income from 2025 at 2-3%
    - Value per share is $1.77- $1.90

    Total PV of the ReOI is $114m and PV of continuing value is $440m.

    Once the full year results are out, I'll adjust it a tad.

    Welcome any feedback.

    thanks

    Disc: I now hold a few shares and will be buying more.
    Independent valuation of MET had them on as much as 17 times underlying earnings and provided we don't go back into lockdown with more community transmission then N.Z. will be seen as a safe haven, real estate will continue to be well supported especially by ex pat's wanting to come home and in 2-3 years time OCA could be reporting around 12-14 cents a share in underlying earnings and the shares could easily be in the range you mentioned by applying a multiple of 17 times say 12 cents, ~ $2.

    On the other hand if through the gross recklessness of someone like that woman who deliberately escaped from quarantine there is community transmission and we get a situation like they have in Victoria at the moment and have another extended period of lockdown then we have another scenario whereby earnings could suffer an even worse hit.

    I think a prudent person keeps some dry powder for that second possible scenario.
    Last edited by Beagle; Yesterday at 04:22 PM.
    No butts, hold no mutts, (unless they're the furry variety).

  13. #5913
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    Quote Originally Posted by Beagle View Post
    Independent valuation of MET had them on as much as 17 times underlying earnings and provided we don't go back into lockdown with more community transmission then N.Z. will be seen as a safe haven, real estate will continue to be well supported especially by ex pat's wanting to come home and in two years time OCA could be reporting around 11-13 cents a share in underlying earnings and the shares could easily be in the range you mentioned by applying a multiple of 17 times say 12 cents, ~ $2.

    On the other hand if through the gross recklessness of someone like that woman who deliberately escaped from quarantine there is community transmission and we get a situation like they have in Victoria at the moment and have another extended period of lockdown then we have another scenario whereby earnings could suffer an even worse hit.

    I think a prudent person keeps some dry powder for that second possible scenario.
    Sure, I've got a conservative outlook on the numbers overall.

    EPS is 14-16 cents a share and forward P/E of 15-17.

    I'm keeping the powder dry - but will accumulate after the results are out.

    Disc: Hold some

  14. #5914
    ShareTrader Legend Beagle's Avatar
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    Be quite a while before they have eps of 14-16 cents in my opinion. I am sure Maverick will have a different view but I think that's 3 years away, maybe 4.
    Its good to be a realist / pessimist, you get disappointed less often 90 cents or thereabouts on next years 10 cps, (provided Covid 19 is kept out of the community, but will that happen ?) is really compelling value though !

    Disc: I still have heaps of these in case anyone is wondering. I just want to take a more conservative view of possible outcomes and of the growth rate as that's good for me to think more conservatively and if I'm wrong and its better than I am expecting, that's great but I am not counting on it.
    Last edited by Beagle; Yesterday at 05:53 PM.
    No butts, hold no mutts, (unless they're the furry variety).

  15. #5915
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    Think 20 years out. What will the price be then. Its a health sector investments and surely as MR B says a long term investment. If you are looking out 20 years then surely there is at least another 24 to 36 months to evaluate this as a long term investment play. Even if you only have say 100,000 a small investment in 20 years what would that look like? DISC: we moved most of our property into ARG over the last 6 months as GMT , PCT topped out. we think the retirement sector is a LONG TERM INVESTMENT.
    Last edited by Waltzingironmansinlgescul; Today at 10:44 AM.

  16. #5916
    Senior Member King1212's Avatar
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    expect OCA spikes up in the next couple weeks as all the MET holders are looking for a new place to park their money in this sector

  17. #5917
    ShareTrader Legend Beagle's Avatar
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    Quote Originally Posted by King1212 View Post
    expect OCA spikes up in the next couple weeks as all the MET holders are looking for a new place to park their money in this sector
    Bingo mate....more than a Billion dollars will be looking for a new home !
    No butts, hold no mutts, (unless they're the furry variety).

  18. #5918
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    chart indicates and i would like to be corrected , a 1.10 retest? before sell off after release of the P&L. Underlying profit and loss seems to be how this sector is priced?
    Last edited by Waltzingironmansinlgescul; Today at 02:10 PM.

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