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  1. #51
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    Thank you percy for posting that, I did have a brief read over it, and found it interesting that ARV has about 1/3 of SUM's retirement village units, so given this, and ARV having about 1/4 market cap of SUM, I am guessing, based purely off a resale/development model only (so excluding the major care facilities ARV has, or any future acquisitions of apartments), I am guessing ARV must work off a different, much much lower margin, resale model for their units?

    Not sure if anyone has seen this yet... its a bit old, but might help... https://www.nzx.com/files/attachments/215474.pdf
    Last edited by trader_jackson; 13-07-2015 at 08:40 PM.

  2. #52
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    Quote Originally Posted by percy View Post
    I would recommend you read the link Winner69 posted on Ryman thread.Post 2411.
    RYM and SUM [I don't follow MET] do not need to raise capital to grow,while ARV do.
    Work out why they don't need to raise capital.
    Here goes Example only;
    Ryman raise $50mil to build a retirement village themselves.
    They build it and sell the rights for people to "occupy" the village for $50mil.
    So they have all their capital back,which they can use to build another village,and keep on repeating ,and repeating ,and repeating..
    In the meantime they own each village without debt.
    So after 10 years they own say 10 villages,generating fees and income and capital gain on $500mil of villages on$50mil capital.!
    But wait there's more.Each time they have resales,they pick up both a deferred fee and a capital gain.And this capital gain is on money Ryman has recycled.
    So after 10 years Ryman are generating fees and capital gains on $500mil of villages not the $50mil they raised to list.
    ARV,example,Raise $50mil.To grow to $500mil they need to raise $450mil.
    Just keep reading the link...
    Last edited by percy; 13-07-2015 at 08:55 PM.

  3. #53
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    Another positive announcement today... https://www.nzx.com/companies/ARV/announcements/267420

    Despite the share price being close to, and sometimes below the offer price (during the SPP), somehow the $5m SPP was still oversubscribed, shows the confidence investors have in ARV... not surprising giving it has a 6.1% gross dividend, and capital growth (that will most likely come with an unusually low PE of 14.9 - and fittingly with these metrics one broker has a price target of $1.09 on it)

    Regardless of if the rest of the retirement sector is more focused on greenfield development and sales associated with that (as percy explains above - lets hope the housing market doesn't go sour...) these valuation metrics are promising for any company (I would think?) I see the directors and institutional investors (eg ANZ) have caught onto this "future winner", I wonder when the rest of the market will...

    What is the differences for brownfeild development (what ARV does) vs greenfeild development (what eg SUM does)?

  4. #54
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    Quote Originally Posted by trader_jackson View Post
    Another positive announcement today... https://www.nzx.com/companies/ARV/announcements/267420

    Despite the share price being close to, and sometimes below the offer price (during the SPP), somehow the $5m SPP was still oversubscribed, shows the confidence investors have in ARV... not surprising giving it has a 6.1% gross dividend, and capital growth (that will most likely come with an unusually low PE of 14.9 - and fittingly with these metrics one broker has a price target of $1.09 on it)

    Regardless of if the rest of the retirement sector is more focused on greenfield development and sales associated with that (as percy explains above - lets hope the housing market doesn't go sour...) these valuation metrics are promising for any company (I would think?) I see the directors and institutional investors (eg ANZ) have caught onto this "future winner", I wonder when the rest of the market will...

    What is the differences for brownfeild development (what ARV does) vs greenfeild development (what eg SUM does)?
    Start at the bottom.The difference is HUGE.HUGE HUGE.
    ARV may be included in the "retirememt sector" however the comparison of brownfield vs greenfield must be recognised, that you are comparing chalk with cheese.You may compare MET,RYM and SUM as they are greenfield,but I am not sure what I would compare ARV with.May sound stupid but possibly PGW?.If that sounds stupid to you, it makes more sense to me than comparing ARV with RYM etc.
    So with ARV you are looking at growth plus divie.PGW forecast PE is 8.92 and yield is 9.56%.
    Housing market?? Funny every one talks retirement sector, housing market,except RYM's CEO Simon Challis.I am with Challis.He has proved that Ryman succeed no matter what the housing market does.

  5. #55
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    Percy, rather than comparing to PGW maybe a better comparison is Greencross?
    “ At the top of every bubble, everyone is convinced it's not yet a bubble.”

  6. #56
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    Quote Originally Posted by winner69 View Post
    Percy, rather than comparing to PGW maybe a better comparison is Greencross?
    As always most probably right.
    After I posted I thought the comparison could be a sheep farmer to a dairy farmer.Both in the same rural sector, but different businesses.Then who do you compare Greencross to,ARV or a retailer.?

  7. #57
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    I don't think PGW is quite appropriate, Greencross potentially more so, although PE is a bit high, its up almost 50% in the past year so hopefully ARV follows this...

  8. #58
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    Quote Originally Posted by trader_jackson View Post
    What is the differences for brownfeild development (what ARV does) vs greenfeild development (what eg SUM does)?
    http://www.stuff.co.nz/business/7053...are-facilities
    "Brownfields refers to a building project that adds on to an existing building or site."
    "The 21 villages had about 2140 beds or apartments in total and Arvida could add another 215 beds or units (10 per cent) via brownfield developments"

  9. #59
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    Yes I saw this today, look forward to ARV continuing to build its portfolio, and increasing its shareholder value accordingly. Looking forward to the dividends a couple of years from now!

  10. #60
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    Not surprisingly a broker has upgraded its price target on Arvida to $1.14, net dividend yield currently 5.2%.

    Clearly brokers aren't always right, but even if they only get to half way to the price target in the next 12 months (from 87c to $1 instead of $1.14)... will still look forward to happy days ahead, and a good interest rate to match

    Could even be introduced into the NZX 50 if share price goes up a bit...
    Last edited by trader_jackson; 29-07-2015 at 09:45 AM.

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