OCA - Oceania Group - retirement villages

[winner69]

Likewise you could argue with interest rates at 200 year lows a market risk premium of 6% is no longer warranted especially given TRINA, (there really is no alternative to stocks).

What else are you going to do, buy corporate bonds or bank term deposits at 1.8%?

That’s why these things are all rather subjective and there’s no right answer.

For each individual MRP is different as it’s related to what return they desire

I suppose 6% is about right for these days

Of course if one was interested one could work out the implied MRP as it is today.

[dibble]

Some advice sought please. I've completed the first iteration of financial statement analysis to get the valuation and set the following parameters. is it too much/little? The outlook is for 5-years.

riskfree rate (T-Bill) - 3.5%
Market Risk premium - 7%
Equity Beta 1.2 (in 2019 it was 1.1)

So, cost of capital is 11.90%

Cost of capital is the variable you twiddle to suit your agenda. Bit like discount rate (ie as an input rather than derived).

For OCA I suspect some investors are happy to hold a bit of money in a stock that pays a relatively stable 5-6% div on the macro basis the capital/business is more likely to grow than shrink over 5 years regardless of some calculation riddled with assumptions.

[bull....]

Cost of capital is the variable you twiddle to suit your agenda. Bit like discount rate (ie as an input rather than derived).

For OCA I suspect some investors are happy to hold a bit of money in a stock that pays a relatively stable 5-6% div on the macro basis the capital/business is more likely to grow than shrink over 5 years regardless of some calculation riddled with assumptions.

thats a mighty assumption that its a stable dividend

[Waltzing]

"stable Div" thats what we have wondered for a while now...we think its been paying out too high a Div.

[winner69]

thats a mighty assumption that its a stable dividend

Maybe a relationship exists between ‘assumptions’ and ‘wishful thinking’ / hope

[dibble]

thats a mighty assumption that its a stable dividend

...true but I did say 'relatively'. Likelihood of any div anywhere next year requires some level of the act of assuming. Bank deposit rates included...

[dubya]

.................................................. Back to OCA, I wonder what EQT will offer for OCA when they have finished the MET takeover and look to combine these companies and reap maybe $10m per annum in synergies ? $1.30 ?

$1.30 would be great
Having said that, I've always wondered if OCA (or any of the other listed RV operators for that matter) ever considered buying MET for the 'instant' revaluation gains and synergies.
I guess I'll never find out the answer to that tho!

[Beagle]

$1.30 would be great
Having said that, I've always wondered if OCA (or any of the other listed RV operators for that matter) ever considered buying MET for the 'instant' revaluation gains and synergies.
I guess I'll never find out the answer to that tho!

The dog might ask SUM hard questions at the forthcoming special meeting for MET about who the other two interested parties were and if they're still in the frame or was this just a load of "creative talk" to spur EQT along ?

Interesting situation developing with OCA...it seems the daily share price performance shows a fairly strong correlation with the number of new virus cases in N.Z.
Zero new cases the share price goes up a bit and when there's 2 or more new cases the share price goes down a bit. Is the market really this fickle or is this apparent share price reaction a figment of my sometimes over active imagination ?

[Joshuatree]

Dont know,but how about you and your pack going paws up and doing a possum covid symptom cluster; keep one eye open on the share price on a screen.

[Baa_Baa]

I thought that was an interesting question, but not sure whether this shows a correlation, if anything it was negatively correlated as the case counts rose, so was the share price rising. Then fell as the case counts declined, then rose as case counts went to zero. Now it's jumping around for no apparent reason related to case counts.

Attachment 11735

Interesting situation developing with OCA...it seems the daily share price performance shows a fairly strong correlation with the number of new virus cases in N.Z.
Zero new cases the share price goes up a bit and when there's 2 or more new cases the share price goes down a bit. Is the market really this fickle or is this apparent share price reaction a figment of my sometimes over active imagination ?