ARV - Arvida Retirement Villages

[King1212]

Extra shares issued today as apart of new villages accusation. Can anyone advise whether additional share added will effect the current SP short term? Thanks guys....

Number of securities in existence after issue 294,456,498

[trader_jackson]

Extra shares issued today as apart of new villages accusation. Can anyone advise whether additional share added will effect the current SP short term? Thanks guys....

Number of securities in existence after issue 294,456,498

Earnings per share, including the issue of new securities, is expected to rise by 6%, so a share price rise of 6% from pre announcement ($1.17 was it?) could be expected (so you'd think $1.24 could be reasonable)

But now that the bargain basement offer (like the previous capital raise at 84 cents) is no longer available, it would seem some are happy not to wait for results to confirm a 6% rise, and instead take some capital gain (understandable I suppose), hence the sell side... it just means ARV is back to being even cheaper than before (trading at an even lower underlying PE!)

Interested to hear other thoughts...
(and it would be great if someone could confirm, or not, my logic)

[King1212]

Earnings per share, including the issue of new securities, is expected to rise by 6%, so a share price rise of 6% from pre announcement ($1.17 was it?) could be expected (so you'd think $1.24 could be reasonable)

But now that the bargain basement offer (like the previous capital raise at 84 cents) is no longer available, it would seem some are happy not to wait for results to confirm a 6% rise, and instead take some capital gain (understandable I suppose), hence the sell side... it just means ARV is back to being even cheaper than before (trading at an even lower underlying PE!)

Interested to hear other thoughts...
(and it would be great if someone could confirm, or not, my logic)

yes TJ...I discussed it with one of my mate(accountant) today...your calculation is spot on..so Arvida is way undervalue with subtainable dividend...thanks to re-assure me TJ!

[winner69]

Earnings per share, including the issue of new securities, is expected to rise by 6%, so a share price rise of 6% from pre announcement ($1.17 was it?) could be expected (so you'd think $1.24 could be reasonable)

But now that the bargain basement offer (like the previous capital raise at 84 cents) is no longer available, it would seem some are happy not to wait for results to confirm a 6% rise, and instead take some capital gain (understandable I suppose), hence the sell side... it just means ARV is back to being even cheaper than before (trading at an even lower underlying PE!)

Interested to hear other thoughts...
(and it would be great if someone could confirm, or not, my logic)

....trading at an even lower PE (on forecast 'normalised' earnings)

I reckon rerated to allow for execution risk

[King1212]

https://www.nbr.co.nz/article/housin...bt-fnzc-report

arvida concentrated on brownfield project and care focus....also see the great Moose comment!

[trader_jackson]

https://www.nbr.co.nz/article/housin...bt-fnzc-report

arvida concentrated on brownfield project and care focus....also see the great Moose comment!

Yes great article, and I'm sure many have seen it.

What I quite like is the "residents of serviced apartments and care facilities don't have much choice on moving in or not and may, therefore, still sell their houses even in a property market downturn"... those companies with a focus on care and serviced apartment side of things (ie ARV and RYM) are therefore alot less vulnerable to property fluctuations than those who are focus on building lovely villas.
(Building lots of villas + borrowing heavily to do so = SUM )

winner69 interesting you mention execution risk, as I would have thought brownfield development would be alot less risky than greenfield. ARV has come a long long way in almost 2 years, from the initial mentions that there would be huge accounting issues (which never happened?)... to the association that ARV was essentially just a "low margin" care facility only (which is certainly not the case now). Several villages have also been successfully integrated, opening up new regions and increasing EPS...
Could one therefore expect that as ARV gets older and more experienced a higher PE could be implied? (as execution risk continually decreases - or is there another execution risk I am missing?)

[King1212]

it looks like 115 is the button....from now I think will see sp going north slowly....what do u think TJ?

[trader_jackson]

wow 90% of rights taken up! This is like crazy high! Just shows the very committed long term shareholders who understand Arvida well (even much better than I do!) Very pleased.

I remember seeing this recently: "SeaDragon Chairman Colin Groves said investor support for the rights offer was a strong endorsement of the company’s strategy and its potential..." and that was for barely 70% of the rights on offer...

https://www.nzx.com/companies/ARV/announcements/291221

[trader_jackson]

https://www.nzx.com/companies/ARV/announcements/291270

$1.13 for the shortfall book build? All gone like that.. and not even 1% off where it was just a few days ago (when it was trading at $1.14 for some reason)... despite wide market (NZX) weakness, particuarly evident with the other retirement stocks, seems people are more than happy to support (with 90% acceptance) and snap this stock up!

The 90% acceptances probably indicate extremely strong village acceptances, so they are clearly confident in themselves and the results they can each provide to the group.

[King1212]

https://www.nzx.com/companies/ARV/announcements/291270

$1.13 for the shortfall book build? All gone like that.. and not even 1% off where it was just a few days ago (when it was trading at $1.14 for some reason)... despite wide market (NZX) weakness, particuarly evident with the other retirement stocks, seems people are more than happy to support (with 90% acceptance) and snap this stock up!

The 90% acceptances probably indicate extremely strong village acceptances, so they are clearly confident in themselves and the results they can each provide to the group.

Excellent!!