Quote Originally Posted by aucklandunistudent View Post
No I am not a holder because it is too illiquid to build up a reasonable holding that you can confidently dispose of the way it is currently trading - that and I am not an expert in the kiwifruit industry, and cannot justify the time investment that knowledge would require given the illiquidity. If I was a holder though I wouldn't be a seller at current prices (because I would have done my homework before buying, and I have a feeling this is a goodie). Have done a bit of work on this one now and will probably do more if I see it drop significantly and I feel there is a lot of upside - may be a buyer then.

While DRPs can be and often are associated with weak cashflows they do not need to be. Just look at the financials - business has been generating strong FFO and CFO with minimal CAPEX over the past few years. CAPEX forecasts in the annuals/presentation are not onerous. Peak FFO was a lot higher than where we are right now, so a lot of potential for non capital intensive cyclical growth as things normalise. CFO bought stock on market recently.

In case you are a beginner I want to caveat all this with I am not an expert in the kiwifruit industry and I might be totally wrong on where things are in the cycle (maybe they are permanently impaired - anybody here have a view on that?) - I haven't done the work to be confident. always DYOR and don't listen to anybody on a forum.
Thank you for you input. It is rare to get such quality input on this forum.

I was talking to a kiwifruit "insider" yesterday. Your thoughts around CAPEX align with his. He is a top 20 holder in Seeka.