HGH - Heartland Group Holdings

[Xerof]

Snoopdog mate,

I don't own these either, and haven't looked at the report in any detail, but mate, you need to look for their 'retention' rates on rollover, which will provide some comfort to you. Banks/finance coys are always keeping an eye on this number, and can raise it or lower it by adjusting the interest rate carded. Shortfalls are easily covered by incoming new deposits, typically. (Augmented by standby facilities sitting undrawn)

Of course, things can and do go wrong, as we saw in the GFC......without the Crown guarantees, everything would have fallen over within weeks, not years, but thats another story

on the other side of the Balance Sheet, it would be fair to say also that very little of loans to customers will be repaid, other than those items structured as table loans. The big exception is personal finance/ car/ hire purchase, where it is actually quite difficult to keep new lending up with natural loan attrition, to maintain the size of the loan book

[Snow Leopard]

With a few million shares shuffling around today this could result in a step change in On Balance Volume which is so loved by some TA practitioners.

If the closing price is down then this will be a step down and a sign that the 'Smart Money' is getting out.
If the closing price is up then this will be a step up and the 'Smart Money' is buying in.
Otherwise if we close at 87c it will not affect the OBV and no smart money is doing anything.

Best Wishes
Paper Tiger

Note: Beware of hidden sarcasm.

[percy]

I thought you and Sparky The Clown were the "Smart Money". lol.

[Snoopy]

Snoopdog mate,

I don't own these either, and haven't looked at the report in any detail, but mate, you need to look for their 'retention' rates on rollover, which will provide some comfort to you. Banks/finance coys are always keeping an eye on this number, and can raise it or lower it by adjusting the interest rate carded. Shortfalls are easily covered by incoming new deposits, typically. (Augmented by standby facilities sitting undrawn)

I don't wish to sound too critical of Heartland Xerof. Actually I think they are managing their situation quite well. However, even a well executed strategy has risks and I think they are becoming apparent here.

The upside of paying out all those dividends is that the confidence of their shareholder base is increasing. Look how confident Percy has become in HNZ! The dividends will be helping keep the share price up too, which will be important if a capital raising is needed.

However, there are no free lunches here. Sure they HNZ can boost their cash reserves by touting for new term deposits at attractive interest rates. But paying above market rates will impact profits. And with $100m in securitzed debt maturing on 24th January 2014 and the other $400m of securitized debt maturing on 5th February 2014 (note 26) and with a $500m cashflow hole showing up in the next six months (note 38). Well lets just say the timing could be better.

Global interest rates look like they might go higher too, so how will that affect the amount that HNZ can borrow from their 'parent' bankers? Shareholder equity is shrinking. This next six months for Heartland will be a defining period in the company's history I feel

SNOOPY

[percy]

To understand Heartland liquidity better one needs to understand Heartland better.The simple way to explain it is; Heartland borrows long and lends short.ie the opposite to most finance companies, who borrow short and lend long.
Heartland is working with their clients who need seasonal loans,livestock loans,small business who need short term finance and factoring.
Long term housing loans they put through Kiwi bank.
Xerofs post, as usual, went a long way to spell this out.He was also right on the money with retention rates.
Heartland have a history of achieving what they say they will do.It was not long ago that I posted I thought Heartland would make $30mil for year ended 31/6/2014.Heartland have come out saying they are looking to make $34 to $37mil.
Who do I believe? Snoopy,whose record is 100% wrong on this thread.?
Or Heartland whose record is 100% correct.?
No contest.! I will go with the "smart money" and listen to what Heartland say.

[Snow Leopard]

....And with $100m in securitzed debt maturing on 24th January 2014 and the other $400m of securitized debt maturing on 5th February 2014 (note 26) and with a $500m cashflow hole showing up in the next six months (note 38)....
SNOOPY

Snoopy, Snoopy, Snoopy, you have to turn off the negative waves and start reading this stuff more carefully.

The Note 26 footnote tells you that the $100M + $400M is only drawn down to $259M so that is the amount to be repaid.
You also imply that that the '$500m cashflow hole' is in addition, but it includes the $259M.

You do not appear to understand that the contract profile is a worst cash scenario where no new deposits at all come in (and no new loans made), and while the maturity profile is only a best guess based on experience it is by far the most realistic, and there will (probably) be no cashflow hole.

Go read the disclosure statements for the likes of ANZ, etc and you will see that all the banks operate like this.

Best Wishes
Paper Tiger

[Hoop]

With a few million shares shuffling around today this could result in a step change in On Balance Volume which is so loved by some TA practitioners.

If the closing price is down then this will be a step down and a sign that the 'Smart Money' is getting out.
If the closing price is up then this will be a step up and the 'Smart Money' is buying in.
Otherwise if we close at 87c it will not affect the OBV and no smart money is doing anything.

Best Wishes
Paper Tiger

Note: Beware of hidden sarcasm.

Fair comment PT .... sarcasm included....Yes its true the OBV has flaws....

PT...you might have noticed that for some charts I post on ST includes many volume/price charts indicators...I do this when I suspect some large investors are slowly building up/selling down on appropriate days using the price changes to hide their activities......OK...Its human nature that they would want the best price possible.... and dumping stock all at once when there is no urgency to do so is a no brainer and often doesn't achieve the best results, neither does buying it all at once....

The downsides ...1.. sudden activity warps the price/demand curve and 2... the whole wide world gets to find out what you are up too ....So using the "slowly slowly catchy Monkey" strategy is an attempt to stay invisible and slow enough so not make a mistake to affect pricing or buyer seller demand to the point that it starts sparking off buy/sell signals ... This strategy can fool the OBV and various price measurement indicators but its harder to stay invisible from the TA technicians using a wide range of money flow price/volume type indicators.

Also, if when using the OBV and you notice its trend diverging from the share price trend, an experienced TA will attempt to confirm the OBV divergence by using a couple of other price/volume indicators....then play TA detective to attempt to discover why...

Also...if it is widely advertised by the media that all TA people use OBV then us sneaky TA Technicians can catch out those more sneakier manipulators who think all eyes are on OBV... Cat and mouse games...Lots of fun...eh?

If you are using a free charting program and short of indicator options using Chaikin Money Flow is probably a better indicator to use than OBV so too arguably is the Money Flow Index and Volume Accumulator (accumulation/distribution) indicator ..however sadly on many free version charting programs many of the better indicators such as Chaikin are not included....

......but all is not lost on the simple TA front as OBV overall performs reasonably well... and it is doing a slow rise on the HNZ chart

[janner]

A wink is as good as a nod to a blind man Hoop.. :-))

Appreciate your comments..

[percy]

A wink is as good as a nod to a blind man Hoop.. :-))

Appreciate your comments..

Loved the quote.!!!!

[SCOTTY]

I would be more interested to know who bought and sold the 13.44m shares traded yesterday?