Tough question to answer. No question some people are already investing additional capital into the sector from cash reserves knowing their cash is highly likely to be replenished, so at the risk of overstating the completely obvious, the proposed MET takeover is already having a significant effect.Originally Posted by limmy
My view on this is that 1.5 billion or thereabouts is a heck of a lot of money looking for a replacement home and that a fair bit of that will get reallocated by institutions to other companies in the retirement sector. That's quite a tailwind for the sector going into 2020 to go with the pretty strong tailwind of a resurgent property market, especially in Auckland. I have posted in detail in the SUM thread where I think it could go in the next few years and that is one of the stocks that is not expensive based on its past well proven track record of growth. Add in the tailwinds now prevailing and I think SUM is going to have a truly outstanding year in 2020. Bear in mind it was ~ $8 way back in August 2018 so its very easy to make the case that you haven't missed the boat on that one.
ARV's slower eps growth, has averaged late single digits over the years leaves me underwhelmed and thinking $2 is getting quite pricey but there's such a tailwind in the sector it could easily go higher still. RYM is around 32 times next years underlying earnings and is also very pricey in my view. OCA a dark horse of the field and tough one to know how its going to go.
I have been buying SUM with existing cash reserves, knowing they are highly likely to be replenished from the MET takeover so am backing my opinion with action. That's my 2 cents worth, and what I am doing, hope it helps.
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