OCA - Oceania Group - retirement villages

[Beagle]

I'm not sure if I've fully got my head around retirement stock acocnting but the fair value movement of investment property is often close to the net surplus. If the market is now guessing these FV movements are neutral or negative then Mr Market could be pricing OCA as a loss-making stock that will struggle to make a profit until property prices are going up. How many months or years away is this?

If you take this view, its pretty easy to justify a big discount to NTA. The gold standard on this reverse metric is your friend MET. Back in 2010 they had NTA of $4.13 with a share price of $2.00 so the market has previously gone below 50% of NTA for a retirement stock.

Perhaps we can go there again another time with the whole revaluation profit v underlying profit thing...it has been covered on the forum many times already, see RYM thread.
The MET thing is a useful marker, thank you. Depending whether one uses NAV or NTA, OCA is already trading at a 56% or 50% discount.

[macduffy]

Warren Buffett gets quoted - and misquoted - a fair bit on these threads, which always seems a bit strange to me. Buffett is an investor, not a Sharetrader. But be that as it may, one of his pearls is to buy stocks that one would be comfortable holding in the event that the market closed down for an extended length of time. I reckon that retirement sector stocks meet that requirement.

[Scrunch]

Perhaps we can go there again another time with the whole revaluation profit v underlying profit thing...it has been covered on the forum many times already, see RYM thread.
The MET thing is a useful marker, thank you. Depending whether one uses NAV or NTA, OCA is already trading at a 56% or 50% discount.

RE underlying profit etc, yes it has been covered in these threads in the past. Your question was however not whether possible issues that could could collapse the price had been previously covered in this forum, but what could cause it. In the current market you don't always need a rational answer, and indeed if you can come up with a semi-rational answer, it could be a good investment opportunity.

So a semi-rational answer is, what if a new bunch of new decision makers are making decisions around retirement stocks using really simple investment rules? These new decision makers are not familiar with the nuances around retirement company accounting (and some pretty smart individuals have struggled!!). They can read the P&L words "fair value movement of investment property" and know that within other industries this line item is part of the wider comprehensive income not the net surplus. When trying to re-evaluate 100's if not 1000's of stocks quickly, they may simply put a line through this revenue item and recalculate the surplus. I'm not saying its correct, just that its possible, particularly if they don't have time to start reading the commentary and notes to the accounts.

I've seen a number of very crude calculations entering updates/briefings at my work. I can only assume this is happening world-wide.

[value_investor]

Excellent buying opportunity right now, I see the eventual way up being very sharp, but also very unknown on when it could happen. 3 months or 2 years, the situation is changing every week to different things.

[Beagle]

Fascinating debate with excellent points made on both sides....sharetrader at its finest.

Very little doubt in my mind we end up at level 4 - widespread community transmission sometime in the next few weeks and lock-down. I also think most investors are expecting the same and to a large extent that's priced in already with retirement stocks and OCA in particular. Also largely priced in, in my view is the Covid 19 situation supressing the value of real estate for a while.

Focusing on the short term, absolutely there is the real chance this goes lower still so I am cautious and inclined towards relying on TA to tell me where the bottom is but on the other hand as one expert on CNBC was saying, very gradually but steadily accumulating one's position over a medium term period of time is not without merit especially for very long term investors. For exmaple a person might put on one tenth of their intended position every second month for the next 20 months, or one tenth every month for the next ten months.

I might go with some sort of hybrid approach to dollar cost averaging and TA...need to do some more work on a possible methodology.

Looking out to 2022 and beyond I think its highly likely, (not certain) that anyone buying at around the current level is going to be very happy with their purchases.

[Zaphod]

Warren Buffett gets quoted - and misquoted - a fair bit on these threads, which always seems a bit strange to me. Buffett is an investor, not a Sharetrader. But be that as it may, one of his pearls is to buy stocks that one would be comfortable holding in the event that the market closed down for an extended length of time. I reckon that retirement sector stocks meet that requirement.

I would certainly agree, and would add that it depends upon your investment horizon.

[King1212]

The problem is....can anyone ignore the fear? Fear is worst than the virus itself.....

Recent observation.....people were selling at all price..... fundies were transferring from growth fubsd to conservative.....

At one point.....we as investors....need to sit back and reflect...how much it enough? We all want the market to crash or buttom n pick it up when u are lucky enough to buy...

40 to 50% drop from it high....anyone would be happy with it? Not talking about OCA ...buy most stocks are down 40 to 50%....

[Cadalac123]

The problem is....can anyone ignore the fear? Fear is worst than the virus itself.....

Recent observation.....people were selling at all price..... fundies were transferring from growth fubsd to conservative.....

At one point.....we as investors....need to sit back and reflect...how much it enough? We all want the market to crash or buttom n pick it up when u are lucky enough to buy...

40 to 50% drop from it high....anyone would be happy with it? Not talking about OCA ...buy most stocks are down 40 to 50%....

The forum is filled with people just giving opinions. Exercise your own logic as an investor and decide yourself when an appropriate time is to buy .

And don’t cry if you buy and it gaps down or you don’t buy for months like some of the investors here are suggesting and it gaps up significantly one day

[allfromacell]

Yes which is why I'm slowly selling stocks that haven't fallen much to recycle into those that have been irrationally beaten to a pulp.

By biggest holding is ATM, which company will double first from here, OCA or ATM? I think the answer to that is obvious hence moving funds into clearly fear driven sold off stocks like this one and a few others.

Remember folks, the low will come BEFORE the worst of this is over. Don't move it all in too quickly but don't leave it too late either. If you choose to use TA to time your purchases for you then all the power to you but I prefer to use my screaming value radar and for this stock it's currently deafening.

[TobyPascoe92]

Get ready for 25cents - prediction: by 3rd April.

[ratkin]

deleted....

[bull....]

Get ready for 25cents - prediction: by 3rd April.

maybe even lower

[Beagle]

I think you guys are getting carried away. The vast majority of their current business is govt funded old folks care.

[bull....]

I think you guys are getting carried away. The vast majority of their current business is govt funded old folks care.

of which they make next to no money. if as i was told about manufacturers to building industry shutting doors at level 4 is correct they wont be able to build any more apartments where they make most of there money

[Beagle]

They do "okay" from Govt funded beds and importantly this gives them operational cashflow for the majority of their business. The real estate market will come back when the dust settles. Talk of 75% discount to NTA is Great depression stuff. While there is a chance of that, I think its unlikely.

[youngatheart]

I'm in love with these 'once in a lifetime' prices. I'd really kick myself if I look back in 2 years time and not realise that I had missed out... Dyor but I'm in for the longer term :)

[SailorRob]

I'm in love with these 'once in a lifetime' prices. I'd really kick myself if I look back in 2 years time and not realise that I had missed out... Dyor but I'm in for the longer term :)


Should we not be seeing immense insider purchase announcements about now?

[TobyPascoe92]

They do "okay" from Govt funded beds and importantly this gives them operational cashflow for the majority of their business. The real estate market will come back when the dust settles. Talk of 75% discount to NTA is Great depression stuff. While there is a chance of that, I think its unlikely.


Keen for a bet Beagle? I think its crazy where their current price is and I agree that it would be extraordinary to see it go that low, I just can't help but see the panic in the selling at the moment. I mean down 15% today and for no reason really? Im going to bring my estimate forward, by the end of March.

[Bjauck]

I'm in love with these 'once in a lifetime' prices. I'd really kick myself if I look back in 2 years time and not realise that I had missed out... Dyor but I'm in for the longer term :) There is always a place for bottom feeders.

[alex f]

Summerset had a decent announcement today. Arv should test their staff weekly, virtually seal the villages off, show everyone how to use FaceTime Skype (maybe on their tvs) offer a shopping service.

[whatsup]

Is OCA a take over opportunity with a M C of approx. $280 mil ?? !

The Chinese have a saying the brave drink champagne the unsure do not !

[winner69]

Is OCA a take over opportunity with a M C of approx. $280 mil ?? !

The Chinese have a saying the brave drink champagne the unsure do not !

Macquaries are always on look out for a bargain.

[ratkin]

Another rest home positive test in Hamilton

[whatsup]

Another rest home positive test in Hamilton

27 staff of the rest home have been put into isolation for 14 days, that to my mind is the tip of the ice berg how many are left and what staff levels do they need to operate successfully ? !!

[peat]

lets be clear now guys, the affected rest home is not Oceania, its part of the Methodist Church

[Entrep]

Macquaries are always on look out for a bargain.

had to chuckle

[winner69]

had to chuckle


They got $300m for their 40% odd a month or so ...only need a bit more to buy the whole lot now.

[Entrep]

39 cent low - unbelievable!!

[blackcap]

39 cent low - unbelievable!!

That is at levels where going concern questions are being raised. Might have to dip in and grab a few more.

[bull....]

Get ready for 25cents - prediction: by 3rd April.

getting closer by the minute

[Entrep]

I just tried calling my grandad in a retirement village - landlines blocked because of congestion.

Spark issue or retirement village thing? Pretty crazy either way

[blackcap]

I just tried calling my grandad in a retirement village - landlines blocked because of congestion.

Spark issue or retirement village thing? Pretty crazy either way

I cannot get hold of my brother cell phone to cell phone. Must be congestion.

[bull....]

They got $300m for their 40% odd a month or so ...only need a bit more to buy the whole lot now.

they are popping the champagne over this one

[tipsy]

Man, into the 30's we go :scared:

[BlackPeter]

Looks like ANZ Investments think this is now good value: they increased their holding from 7.4 to 8.4% and issued SSH:

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/OCA/350460/319402.pdf

[hyinvest]

Looks like ANZ Investments think this is now good value: they increased their holding from 7.4 to 8.4% and issued SSH:

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/OCA/350460/319402.pdf

From where you get it?

[Gerald]

From where you get it?

https://www.nzx.com/markets/NZSX/announcements

[dubya]

Looks like ANZ Investments think this is now good value: they increased their holding from 7.4 to 8.4% and issued SSH:

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/OCA/350460/319402.pdf

Yeah some would say the transfer of wealth from weak to strong?
I think there could be some more SSH's in the coming days too, but time will tell I guess:confused:

[cymonger]

Let's not sugarcoat things. It's a fear-driven market right now, and things will almost certainly get worse before they get better. As Tommy Lee Jones said in Men in Black, "A person is smart. People are dumb. Panicky, dangerous animals and you know it." Witness Jacinda telling people please not to panic and raid the Supermarkets tonight, and before she could even finish her speech, people were ripping packages of Spaghetti off the shelves like it was gold.

And yet, to those who can keep their heads, think of the tremendous amount of wealth that is going to be created buying a company like this at these prices. Tragedies often involve a further transfer of wealth from the fearful to the powerful. This virus will pass. Our population is still aging. The retirement sector is still gonna boom. Nothing about any of that has changed. This will be a ten banger from here in 2024. At the VERY least a five banger. That's a tremendous opportunity.

[peat]

Definitely a long term perspective required on any purchases being made currently. But there has to be long term value. Right?

I saw a Fed guy saying they had infinite money so dont you worry. Which of course scares me silly, but the powers that be are determined to create inflation and stocks and property tend to benefit from that.

[Maverick]

While the ludicrous imbalance of fear and margin calls v's "patient buyers" or " buyers with no cash left "are the only drivers of this situation (I will not call it a functioning market) there are a few positive considerations;
-care suites must surely be in red hot demand right now,and this is where the good money is made.
-embedded value will be realised as predictable as concrete setting, after all, are our community of clients going somewhere else?
- as Beagle correctly reminds us, a load of weekly GOVT funding is certain.
- GOVT injected stimulus into the economy will certainly eventually end up in a combo of NZSX and property prices.
- when we emerge from the "lost 3 months in NZ" we will all be 3 months older.

... now here's the kicker, Earle has said there has been no noticible change (up until last weeks announcement) that anything has changed in sales , resales performance etc.....
so.....reworking my spreadsheets assuming that NO transactions of anything property based happens in the next 2 months ahead then OCA should make 50m (pre tax) underlying profit FY2020.

Thats a stunning return at even 50 cents SP!

Will this company go bust in the mean time, why would it?

[value_investor]

While the ludicrous imbalance of fear and margin calls v's "patient buyers" or " buyers with no cash left "are the only drivers of this situation (I will not call it a functioning market) there are a few positive considerations;
-care suites must surely be in red hot demand right now,and this is where the good money is made.
-embedded value will be realised as predictable as concrete setting, after all, are our community of clients going somewhere else?
- as Beagle correctly reminds us, a load of weekly GOVT funding is certain.
- GOVT injected stimulus into the economy will certainly eventually end up in a combo of NZSX and property prices.
- when we emerge from the "lost 3 months in NZ" we will all be 3 months older.

... now here's the kicker, Earle has said there has been no noticible change (up until last weeks announcement) that anything has changed in sales , resales performance etc.....
so.....reworking my spreadsheets assuming that NO transactions of anything property based happens in the next 2 months ahead then OCA should make 50m (pre tax) underlying profit FY2020.

Thats a stunning return at even 50 cents SP!

Will this company go bust in the mean time, why would it?

I expect the upswing to be short and sharp, getting in at these prices are probably a once in a lifetime opportunity.

Why wouldn't you..

[Beagle]

Thanks for reworking the numbers Mav. Keep you chin up mate.

[bull....]

While the ludicrous imbalance of fear and margin calls v's "patient buyers" or " buyers with no cash left "are the only drivers of this situation (I will not call it a functioning market) there are a few positive considerations;
-care suites must surely be in red hot demand right now,and this is where the good money is made.
-embedded value will be realised as predictable as concrete setting, after all, are our community of clients going somewhere else?
- as Beagle correctly reminds us, a load of weekly GOVT funding is certain.
- GOVT injected stimulus into the economy will certainly eventually end up in a combo of NZSX and property prices.
- when we emerge from the "lost 3 months in NZ" we will all be 3 months older.

... now here's the kicker, Earle has said there has been no noticible change (up until last weeks announcement) that anything has changed in sales , resales performance etc.....
so.....reworking my spreadsheets assuming that NO transactions of anything property based happens in the next 2 months ahead then OCA should make 50m (pre tax) underlying profit FY2020.

Thats a stunning return at even 50 cents SP!

Will this company go bust in the mean time, why would it?

could be a load of empty care beds to come as well and i mean with the property development side in limbo as well :scared: empty care beds they be broke in a worse case senario. the market is right

[dobby41]

I expect the upswing to be short and sharp, getting in at these prices are probably a once in a lifetime opportunity.

Why wouldn't you..

I'd expect that with the gyrations we have already had (with a few people burnt a second time) that an upswing will be slow.
It may pop up but profit takers (or lower loss takers) will step in and punt the price down a bit again.
I doubt it pops up as fast as it went down.

[Maverick]

could be a load of empty care beds to come as well and i mean with the property development side in limbo as well :scared: empty care beds they be broke in a worse case senario. the market is right
Yep, you nailed it once again Bull.
Property will definitely crash and old people will either all die over this or no longer need late stage care anymore because Covid has stopped cancer and those other details that used to happen.
OCA is in big trouble , thanks for bringing it to our attention.

[bull....]

Yep, you nailed it once again Bull.
Property will definitely crash and old people will either all die over this or no longer need late stage care anymore because Covid has stopped cancer and those other details that used to happen.
OCA is in big trouble , thanks for bringing it to our attention.

I didnt say the property market would crash , i said in limbo means not doing anything. retirement stocks need a rising , good market to make there margins.
covid is worse than cancer etc because it kills and spreads with such speed so yes a spread in a care bed facitilty may potentially empty the whole place which means no income from care beds and there may not be the people to replace them if the virus is rampant in society. as an investor its not all rosy and bullish people need to think of every senario for stocks , obviously your bullish and im not so that sums the market up beautifully dont you think

[Preston]

I don’t see how demand will get less here. We tried to get my great Aunty into home a couple of years ago. Told it was a two year wait for a half decent one. My old man ended up just chatting to a guy and bought one at a “lesser” establishment through the back door. The waiting times for some folks are very long. By the time you need one, it’s too late.

And secondly if elderly people contract this thing and it has ongoing implications, a care home is the best place for them?

I can see balance sheets being affected by property value yes, but bottom line after it washes out, not so much. I imagine there will be some teething time to get back to normal Ops.

[forest]

Some better news, Chairperson Elizabeth Coutts has been buying shares in OCA for 56 cents.
Mmn, she might have read Beagles post and realises the discount to NTA. :)

[macduffy]

Some better news, Chairperson Elizabeth Coutts has been buying shares in OCA for 56 cents.
Mmn, she might have read Beagles post and realises the discount to NTA. :)

More likely she realises that it's not the end of the world for OCA and that it has a prosperous future and a healthy shareprice once this crisis is over.

:)

[Beagle]

LOL forest, I am pretty sure she can work that out for herself :)

[Bjauck]

I didnt say the property market would crash , i said in limbo means not doing anything. retirement stocks need a rising , good market to make there margins.
covid is worse than cancer etc because it kills and spreads with such speed so yes a spread in a care bed facitilty may potentially empty the whole place which means no income from care beds and there may not be the people to replace them if the virus is rampant in society. as an investor its not all rosy and bullish people need to think of every senario for stocks , obviously your bullish and im not so that sums the market up beautifully dont you think In your scenario of emptying beds, there will be others who survive the illness but it may have been the last straw for their remaining in independent accommodation.

So the demand for hospital and rest home beds may increase too. Any lessening in care bed demand may be further down the track and may mean that any previous forecast of shortage of care beds is no longer so acute.

Even in a stagnant price property market, the ora system would still enable profits to be made.

[Valiant]

I would hope that we'd see other directors purchasing shares too, just to reinforce the perceived discount.

Also, I would think it won't take long before OCA (and the other listed retirement companies) make an announcement similar to RYMs this morning.

[macduffy]

I would hope that we'd see other directors purchasing shares too, just to reinforce the perceived discount.

Also, I would think it won't take long before OCA (and the other listed retirement companies) make an announcement similar to RYMs this morning.

SUM did, yesterday.

https://www.nzx.com/announcements/350404

[dr_]

Lot of doom and gloom with OCA...

Well, another director brought $500k on-market on 20th.

[Food4Thought]

Lot of doom and gloom with OCA...

Well, another director brought $500k on-market on 20th.

Good place to be if you are inside.
And happy to ride out the next 6 months.

If they times the bottom, that'll be fantastic for them.

Cautious with this unprecedented uncertainty for the short term.

Long term, New Zealand is a magic place.

Also a great way to average down your cost of shares atm...

Say I bought 10000 @1, now I buy 20000 at 40c... still makes 50c sound cheap. If I knew the bottom or what was going to happen, od be onto a winner.

Many numbers to observe and confidence level to take into account.

I sincerely hope it goes well for all holders

[iceman]

Good place to be if you are inside.
And happy to ride out the next 6 months.

If they times the bottom, that'll be fantastic for them.

Cautious with this unprecedented uncertainty for the short term.

Long term, New Zealand is a magic place.

Also a great way to average down your cost of shares atm...

Say I bought 10000 @1, now I buy 20000 at 40c... still makes 50c sound cheap. If I knew the bottom or what was going to happen, od be onto a winner.

Many numbers to observe and confidence level to take into account.

I sincerely hope it goes well for all holders

I don't think the Directors are concerned with timing the bottom. They are not your average punter. I say well done on them for using their inside knowledge of the company to send a strong signal to the market that they think the shares have been oversold and they have no concerns about the ability of OCA to continue operations. I say thanks to them for this strong conviction

[BlackPeter]

I don't think the Directors are concerned with timing the bottom. They are not your average punter. I say well done on them for using their inside knowledge of the company to send a strong signal to the market that they think the shares have been oversold and they have no concerns about the ability of OCA to continue operations. I say thanks to them for this strong conviction

I'd second that ...

[Ggcc]

a nice little bounce, but will it last

[allfromacell]

So to the TA experts, is it time to get in? Happy with my buys at $0.61, $0.56 and $0.40. The value at $0.40 really was ridiculous

[Food4Thought]

So to the TA experts, is it time to get in? Happy with my buys at $0.61, $0.56 and $0.40. The value at $0.40 really was ridiculous

If people start getting worried fear will kick in even more and the price will go down further. If it is anything like the news overseas and things get ugly there will be plenty of opportunity to buy in the next few months. Great to get in early and not miss the boat.

I am waiting for now

[Beagle]

I am patiently curled up in my kennel. No point in being on guard ready to pounce at this stage. Taken a break from licking the little cut in my paw from last week's dabble at 60 cents. For some strange reason the wound has healed up quickly :)

[cymonger]

Deleted. Double post

[youngatheart]

Ugh. Futures heading back down... https://www.cnbc.com/pre-markets/

[Maverick]

I love the way this stock is priced. The way it's moving. And the opportunity it presents at these levels.

Having said that.


Sold a huge lot at .60 today. Purchased those shares at .40.


I am 99% sure this a fabulous investment from here. But the market is going to keep doing this wild swing thing for a while. I wish New Zealand could disentangle itself from moving with the American market.. The fact is, New Zealand is handling the virus, and America is making disastrous decisions that will lead to further crashes in the months to come. It's really just a matter of doing maths at this juncture. Trump can't wish this thing away. But he's sure as hell trying.

Oca will go back down. Then go way back up. Rinse. Repeat. it's an amazing little day trader at the moment.
Good on you , you really can't go wrong going long at these levels.
You are making money , nothing wrong with that , and your contributions in tax to help the country will be greatly appreciated

Everyone wins except the seller , they should have read share trader.

[Ggcc]

Good on you , you really can't go wrong going long at these levels.
You are making money , nothing wrong with that , and your contributions in tax to help the country will be greatly appreciated

Everyone wins except the seller , they should have read share trader.

What I do wonder is in these volatile times whether people pay their correct amount in tax or not........

[fish]

What I do wonder is in these volatile times whether people pay their correct amount in tax or not........

There could be a lot of people doing lots of trades so they can be defined as a sharetrader and get tax credits for their losses.
I trade a lot but my intention when buying is to hold long-term.My accountant says I am not a sharetrader-just an investor who likes to keep a balanced portfolio and has a tendency to change his mind in the light of unpredictable events.

[IAK]

Everyone wins except the seller , they should have read share trader.

Unless they're selling and using the proceeds to buy other "under-priced" shares. Suppose it's like selling and buying houses in the same market.

[Ggcc]

There could be a lot of people doing lots of trades so they can be defined as a sharetrader and get tax credits for their losses.
I trade a lot but my intention when buying is to hold long-term.My accountant says I am not a sharetrader-just an investor who likes to keep a balanced portfolio and has a tendency to change his mind in the light of unpredictable events.
Of course you would need to prove that to the IRD and not your accountant, if they ever asked.

[Maverick]

It would now seem OCA will have a nice uptick in its “meals “ income stream. This is reported in“other income” and is usually benign and not worth considering. They will now be cooking onsite and delivering a substantial amount of room service. This is all chargeable. Obviously it's a minor thing but it I still expect it to be worth noting.


I don't not expect for a minute that OCA will price gouge on this new situation but the inefficiency of their newly filling up sites will now be humming at capacity. Anybody who has been in business knows how profits leap at maximum production.


Once again, I really do see this particular company eventually benefiting from this in time. All the pre- virus talk here on it being “needs based” and “govt subsidised” still holds true. A year or 2 from now, the sector will have gone from currently “sell, sell, sell” to being back in favour more than ever. I believe we are already seeing it now the panic is already sub siding.

[macduffy]

I don't not expect for a minute that OCA will price gouge on this new situation but the inefficiency of their newly filling up sites will now be humming at capacity. Anybody who has been in business knows how profits leap at maximum production.


Am I correct in assuming that you meant "I don't expect...…"? If so, I fully agree.

[Maverick]

Am I correct in assuming that you meant "I don't expect...…"? If so, I fully agree.
Yep...as usual my gramma is hopeless. I expect OCA will be honourable. Good point

[davflaws]

Is your gramma in an OCA facility?

[MauroNZ]

I love the way this stock is priced. The way it's moving. And the opportunity it presents at these levels.

Having said that.


Sold a huge lot at .60 today. Purchased those shares at .40.


I am 99% sure this a fabulous investment from here. But the market is going to keep doing this wild swing thing for a while. I wish New Zealand could disentangle itself from moving with the American market.. The fact is, New Zealand is handling the virus, and America is making disastrous decisions that will lead to further crashes in the months to come. It's really just a matter of doing maths at this juncture. Trump can't wish this thing away. But he's sure as hell trying.

Oca will go back down. Then go way back up. Rinse. Repeat. it's an amazing little day trader at the moment.

Good on you. When I saw the price I thought it could still go down as I'm not an expert on bottoms but seeing where it is now I regret it. I might have a close eye on it.

[Baa_Baa]

Is your gramma in an OCA facility?

lol 😂 …...

[Joshuatree]

Is your gramma in an OCA facility?

You really mean grandma ehh?:D

[Cadalac123]

Funny how people are changing their sentiment on OCA simply based on price action .

Might be worthwhile remembering current price action isn’t a representation of the underlying business

[Blue Skies]

Funny how people are changing their sentiment on OCA simply based on price action .

Might be worthwhile remembering current price action isn’t a representation of the underlying business

I think it’s much more to do with the higher percentage of their business model being based on Care Beds with a govt guaranteed source of continuous income. Suddenly that difference instead of being a disadvantage is looking like a strength. Ie their model is not just built on property development.

[Beagle]

I think it’s much more to do with the higher percentage of their business model being based on Care Beds with a govt guaranteed source of continuous income. Suddenly that difference instead of being a disadvantage is looking like a strength. Ie their model is not just built on property development.

^^^^^^ This +1

[winner69]

Funny how people are changing their sentiment on OCA simply based on price action .

Might be worthwhile remembering current price action isn’t a representation of the underlying business

One then needs to ask what is the value of the underlying business


Surely ‘sentiment’ plays a large part in assessing that

[youngatheart]

Hmmm. I've noticed a particularly strong correlation between OCA's share price and the Dow Index (in the morning) and then the Dow Index Futures (in the afternoon).
If the Dow ends up, OCA opens up. As soon as the Dow Futures changes, OCA goes further up or trends down...

[peat]

Hmmm. I've noticed a particularly strong correlation between OCA's share price and the Dow Index (in the morning) and then the Dow Index Futures (in the afternoon).
If the Dow ends up, OCA opens up. As soon as the Dow Futures changes, OCA goes further up or trends down...

Of course there are individual variations but at the end of the day its all the same market, risk on, or risk off.

[Cadalac123]

One then needs to ask what is the value of the underlying business


Surely ‘sentiment’ plays a large part in assessing that

My statement was a mere reflection of people FOMOing and knowing nothing about the actual stocks going up and forgetting their downsides

I should declare I bought some OCA at 0.40

[Beagle]

My statement was a mere reflection of people FOMOing and knowing nothing about the actual stocks going up and forgetting their downsides

I should declare I bought some OCA at 0.40

Congrats, that's very clever buying in my opinion.

[Cyclical]

I think it’s much more to do with the higher percentage of their business model being based on Care Beds with a govt guaranteed source of continuous income. Suddenly that difference instead of being a disadvantage is looking like a strength. Ie their model is not just built on property development.

Speaking of the property development side of things... I know Jacinda said not on her watch after the last failed effort, but given the current extraordinary circumstances in which we find ourselves clocking up massive debt, I wonder if we might see the idea of a capital gains taxed refloated, particularly if they manage to squeak in without NZ First. I know there was much debate about the implications of CGT on these sorts of companies, of which I'm unsure what the conclusion was. Just food for thought.

[Bjauck]

Speaking of the property development side of things... I know Jacinda said not on her watch after the last failed effort, but given the current extraordinary circumstances in which we find ourselves clocking up massive debt, I wonder if we might see the idea of a capital gains taxed refloated, particularly if they manage to squeak in without NZ First. I know there was much debate about the implications of CGT on these sorts of companies, of which I'm unsure what the conclusion was. Just food for thought.
You have got to be kidding me - the vested interests will be stronger than ever. Another generation will be put off share investments - they will have seen dividends slashed, share prices slashed and KiwiSaver savings drop. So the paltry capitalisation of the NZ share market will become even more paltry.

it will be real estate investment for most de facto NZ pension assets with KiwiSaver receiving the barest minimum contributions. If political parties mess with introducing stamp duties on property and capital gains tax on leveraged assets, they won’t get elected.

NZX May close or be taken over by the ASX. Or, Perhaps an even greater shift overseas of NZ companies from the NZX. There will be further polarisation in wealth as the aristocracy of landowners rent their investments out to the 66% of the urban population (the new proletariat) who will be working for foreign owned business and industry and who will be unable to afford home ownership.

Well the preceding could be a consequence of the Great Coronavirus Recession.

[stoploss]

You have got to be kidding me - the vested interests will be stronger than ever. Another generation will be put off share investments - they will have seen dividends slashed, share prices slashed and KiwiSaver savings drop. So the paltry capitalisation of the NZ share market will become even more paltry.

it will be real estate investment for most de facto NZ pension assets with KiwiSaver receiving the barest minimum contributions. If political parties mess with introducing stamp duties on property and capital gains tax on leveraged assets, they won’t get elected.

NZX May close or be taken over by the ASX. Or, Perhaps an even greater shift overseas of NZ companies from the NZX. There will be further polarisation in wealth as the aristocracy of landowners rent their investments out to the 66% of the urban population (the new proletariat) who will be working for foreign owned business and industry and who will be unable to afford home ownership.

Well the preceding could be a consequence of the Great Coronavirus Recession.

Real Estate not the easiest at the moment .
Plenty of people who thought Air BnB was an easy way to make money scarambling to find tenants ... Not so easy in Queenstown......
Plenty of tenants saw the " Mortgage Holiday " headlines and emailed the landlord , we are not paying .
So Real Estate will have a few wiped out that don't have the reserves or enough equity in the properties to get a "mortgage deferral " with their bank .
So winners and losers in all asset classes.

[Brfc]

Hi guys

I have been reluctant to post as i am a bit biased in this industry having owned and operated rest homes/retirement village since the early 90" s

Currently i only own a rest home having sold my previous operations a few years back.

My thoughts is only to do with the rest-home side of things

Thoughout the years i have been involved the industry as become tougher and harder to run (which as been good and Bad ) but with all the rules and regulations the DHB as still havent come up with a plan to stop the influx of people needing care and the service that we have to offer

For a example have a few years back my breakeven point was approx 72 % occ but with the extra Wages/Compliance costs it now is currently approx 80%
However once you get over the 80% cause of the increased fees i due to inflation etc the profit is roughly the same as it was when the breakeven point was 72%
So if you take extra care etc for the residents you should be running around 95% occ rate which i am pleased to say my facility achieves

NOW to the present situation we find ourselves in today apart from extra costs in following daily DHB procedures mainly cleaning products we are currently 100% full with a waiting list as people see us as one of the safest place for the elderly ( We had a vacancy last week and there was a list of clients wanting the room )
my staff are well aware of there responsibilities and i am proud of everyone of them
In Regards to Oceania they will still be making money in todays world for the reasons above (Even though Sales will be non exsitent and this will effect there bottom line )alot companies cant say this whilst we are in lock down
So at $1.20 before this crises it deserved to be discounted to due being no sales but at .40 the other day and today at .59 cents it is once in a lifetime bargin
Accordingly i dont normally buy shares but i have been buying truckloads at these prices
DYOR Thanks

[Ggcc]

Hi guys

I have been reluctant to post as i am a bit biased in this industry having owned and operated rest homes/retirement village since the early 90" s

Currently i only own a rest home having sold my previous operations a few years back.

My thoughts is only to do with the rest-home side of things

Thoughout the years i have been involved the industry as become tougher and harder to run (which as been good and Bad ) but with all the rules and regulations the DHB as still havent come up with a plan to stop the influx of people needing care and the service that we have to offer

For a example have a few years back my breakeven point was approx 72 % occ but with the extra Wages/Compliance costs it now is currently approx 80%
However once you get over the 80% cause of the increased fees i due to inflation etc the profit is roughly the same as it was when the breakeven point was 72%
So if you take extra care etc for the residents you should be running around 95% occ rate which i am pleased to say my facility achieves

NOW to the present situation we find ourselves in today apart from extra costs in following daily DHB procedures mainly cleaning products we are currently 100% full with a waiting list as people see us as one of the safest place for the elderly ( We had a vacancy last week and there was a list of clients wanting the room )
my staff are well aware of there responsibilities and i am proud of everyone of them
In Regards to Oceania they will still be making money in todays world for the reasons above (Even though Sales will be non exsitent and this will effect there bottom line )alot companies cant say this whilst we are in lock down
So at $1.20 before this crises it deserved to be discounted to due being no sales but at .40 the other day and today at .59 cents it is once in a lifetime bargin
Accordingly i dont normally buy shares but i have been buying truckloads at these prices
DYOR Thanks
Nice post thanks

[fish]

Nice post thanks

BRFC-one of the best posts ever.Skin in the game-in everyway.
Wisdom that only years of experience can give.
I will sleep a lot better tonight having bought a lot last week just to see lots more selling.

[iceman]

Thanks for an interesting and informative post Brfc

[Pintboy568]

This forum may be small but it is perfectly formed and so much better than Hotcopper.

[value_investor]

Bought heavily earlier on in the week, glad I got in at that price. Still looking to add more onto this, based on what's happening. It's going to be long and drawn out but the demand side will always be there in the long term.

Interesting times in the investing side, alot of people selling out quickly. Peoples time horizons must be incredibly short, I'm in for the long term but even if you're in for 10 years, you should be okay with what's happening.

[MauroNZ]

Hi guys

I have been reluctant to post as i am a bit biased in this industry having owned and operated rest homes/retirement village since the early 90" s

Currently i only own a rest home having sold my previous operations a few years back.

My thoughts is only to do with the rest-home side of things

Thoughout the years i have been involved the industry as become tougher and harder to run (which as been good and Bad ) but with all the rules and regulations the DHB as still havent come up with a plan to stop the influx of people needing care and the service that we have to offer

For a example have a few years back my breakeven point was approx 72 % occ but with the extra Wages/Compliance costs it now is currently approx 80%
However once you get over the 80% cause of the increased fees i due to inflation etc the profit is roughly the same as it was when the breakeven point was 72%
So if you take extra care etc for the residents you should be running around 95% occ rate which i am pleased to say my facility achieves

NOW to the present situation we find ourselves in today apart from extra costs in following daily DHB procedures mainly cleaning products we are currently 100% full with a waiting list as people see us as one of the safest place for the elderly ( We had a vacancy last week and there was a list of clients wanting the room )
my staff are well aware of there responsibilities and i am proud of everyone of them
In Regards to Oceania they will still be making money in todays world for the reasons above (Even though Sales will be non exsitent and this will effect there bottom line )alot companies cant say this whilst we are in lock down
So at $1.20 before this crises it deserved to be discounted to due being no sales but at .40 the other day and today at .59 cents it is once in a lifetime bargin
Accordingly i dont normally buy shares but i have been buying truckloads at these prices
DYOR Thanks


Such a valuable post, thanks for it. I wish I had seen this posted when price was 0.40.

[carrom74]

Such a valuable post, thanks for it. I wish I had seen this posted when price was 0.40.

Still have a slim chance to get in tomorrow- but certainly not at 40cents...but even at 50 cents it’s worth it.

[Entrep]

Still have a slim chance to get in tomorrow- but certainly not at 40cents...but even at 50 cents it’s worth it.

Tomorrow? What’s the rush. Next few weeks will be BRUTAL

[cymonger]

Still have a slim chance to get in tomorrow- but certainly not at 40cents...but even at 50 cents it’s worth it.

There will be a dozen more Black Mondays before this thing is over. Maybe a lot more than that. The situation in the US is gonna get really bad, which is gonna drag the NZ market down with it. I hate to be gloomy, but the virus is not being handled there.

[ratkin]

There will be a dozen more Black Mondays before this thing is over. Maybe a lot more than that. The situation in the US is gonna get really bad, which is gonna drag the NZ market down with it. I hate to be gloomy, but the virus is not being handled there.

Wall street a pretty tough crowd though, they will probably see the virus being handled badly as a good thing, for them the quicker everyone gets it the better.

[blackcap]

Wall street a pretty tough crowd though, they will probably see the virus being handled badly as a good thing, for them the quicker everyone gets it the better.

Totally agree. No sentiment or empathy with markets. If it gets bad in America and a lot of old people die, while the young are out there working, that will only be good for Wall St.

[allfromacell]

Wall street a pretty tough crowd though, they will probably see the virus being handled badly as a good thing, for them the quicker everyone gets it the better.

Everyone getting the virus quickly is not a good thing for the markets, economy or humanity. No matter how you frame it we cannot let that happen. We don't know how long our immune antibodies will last against this particular virus, it could be forever or just months. Imagine if 50% of the population gets it with millions of deaths and we don't even develop long lasting immunity. Going for a rapid burn out or herd immunity solution will be devastating, millions of people will die and health systems would be completely overrun, imagine the chaos in poorer less developed nations.

A full scale lock-down is the only way to beat this, fortunately for NZ and OCA we appear to be flattening the curve with 3 consecutive days of slowing growth and that's not even allowing enough time to take into account the impact of the L4 lockdown. If tomorrows numbers are down again on today's I suspect OCA SP will close higher. OCA at $0.40 was pricing in a US equivalent disaster and fortunately we've had strong leadership who've been able to make the pragmatic scientific based decision to lock-down quickly. I suspect as long as we can maintain low local spread and return to BAU slowly maintaining strict boarder measures OCA will be just fine and the SP will soon return to $1+.

[ratkin]

Deleted (off topic)

[Bjauck]

Such a valuable post, thanks for it. I wish I had seen this posted when price was 0.40. The best advice so often comes afterwards.

[Maverick]

This post has nothing very little to do with OCA, but I feel this particular thread has attracted a smarter / positive crowd compared to some of those dominating the on more appropriate threads.

FWIW, I talked to 2 of my kids with over the weekend and as a result they switched their KiwiSaver from "balanced" to "growth" funds.

For any oldies here , it took 2 tick boxes and 1 minute.
Without doubt this "ease of switching" has partially contributed to the panic selling we saw last week (OCA diving to 40cents��) .
Anyway just sharing in case other parents on this forum also think this a good idea.

[Bjauck]

...
Without doubt this "ease of switching" has partially contributed to the panic selling we saw last week (OCA diving to 40cents) .
Anyway just sharing in case other parents in this forum might also think this a good idea. The waves of panic may still be washing around the globe.

[BlackPeter]

This post has nothing very little to do with OCA, but I feel this particular thread has attracted a smarter / positive crowd compared to some of those dominating the on more appropriate threads.

FWIW, I talked to 2 of my kids with over the weekend and as a result they switched their KiwiSaver from "balanced" to "growth" funds.

For any oldies here , it took 2 tick boxes and 1 minute.
Without doubt this "ease of switching" has partially contributed to the panic selling we saw last week (OCA diving to 40cents��) .
Anyway just sharing in case other parents on this forum also think this a good idea.

I agree that it is a good idea not to forget to move Kiwi saver funds more towards growth as soon as we are close to the bottom. Whether this is already now - I can't really say.

Discl: I plan to spread my conservative Kiwi saver powder over time ... but to be honest - I took the first step in moving part of my conservative funds into growth funds last week. It is in my view likely not yet the bottom, but it is tough to bottom pick - and I am pretty sure that in a handful of years I will be quite content with the current purchase prices ...

[Arthur]

The number of cases in retirement homes (and prisons) in USA is rapidly increasing. Every week Trump and his merry men piss around and try to ignore the science doubles the number of deaths they will get. Some states have locked down, but the good doctor is now guessing 200,000 dead. The flow through from the rest home stories in USA will have some impact here, but I have been buying the aged care sector in small quantities.

[blackcap]

The number of cases in retirement homes (and prisons) in USA is rapidly increasing. Every week Trump and his merry men piss around and try to ignore the science doubles the number of deaths they will get. Some states have locked down, but the good doctor is now guessing 200,000 dead. The flow through from the rest home stories in USA will have some impact here, but I have been buying the aged care sector in small quantities.

200,000 dead in the States is the same as saying NZ will have 3,125 dead. Tragic yes, but economically insignificant.

[Arthur]

He is assuming that there are more lock downs and other mitigation measures in place. "Only" 2977 died in 9/11 and look at the huge irrational ramifications of that. OTT airport inspections, bombing of nations that had nothing to do with it, locking up of innocent people without trial. The vast majority of CV19 the deaths in USA will be due to the anti science brigade and political incompetence. Whether they will be held accountable is another thing. Just like the American reaction to 911 became imposed as "best practise" , so the rest home industry here may suffer doing unnecessary things that are imposed as "best practise".

[justakiwi]

What kind of unnecessary things?


so the rest home industry here may suffer doing unnecessary things that are imposed as "best practise".

[macduffy]

This post has nothing very little to do with OCA, but I feel this particular thread has attracted a smarter / positive crowd compared to some of those dominating the on more appropriate threads.

FWIW, I talked to 2 of my kids with over the weekend and as a result they switched their KiwiSaver from "balanced" to "growth" funds.

For any oldies here , it took 2 tick boxes and 1 minute.
Without doubt this "ease of switching" has partially contributed to the panic selling we saw last week (OCA diving to 40cents��) .
Anyway just sharing in case other parents on this forum also think this a good idea.

Good post, Maverick. I've thought for some time now that the wild swings in the market - not just OCA, but mentioning them keeps this thread on topic! -have been aggravated by the abrupt movements in and out of the different risk categories of Kiwisaver. I don't think that this is the time to get too clever trying to finesse one's savings this way.

[Arthur]

What kind of unnecessary things?

When the dust has settled there will likely be more visitor screening, stricter staff requirements, more health checks. Not saying any of that makes sense, but a good crisis usually results in more regulation.

[youngatheart]

If its another announcement of lower numbers testing positive for Cov19 here in NZ, then I foresee a big run on this stock.
Never mind the tragedy in the US if it looks like we are getting control here then cashed up people (some of those who have just received their govt. payments - $4,200 for laid off part-timers, $7,200 for laid off full timers - are probably going to be tempted for a better return than it sitting in the bank at 1. 3%...

[youngatheart]

What time do the Cov19 numbers usually get released?

[Crisis]

Usually at 1.00 pm.

[justakiwi]

As someone working in a rest home, I doubt this. More likely, everything will just gradually go back to normal and everyday complacency will settle back in. Just as it will with most of us as individuals.


When the dust has settled there will likely be more visitor screening, stricter staff requirements, more health checks. Not saying any of that makes sense, but a good crisis usually results in more regulation.

[Beagle]

If its another announcement of lower numbers testing positive for Cov19 here in NZ, then I foresee a big run on this stock.
Never mind the tragedy in the US if it looks like we are getting control here then cashed up people (some of those who have just received their govt. payments - $4,200 for laid off part-timers, $7,200 for laid off full timers - are probably going to be tempted for a better return than it sitting in the bank at 1. 3%...

VERY early days in this bear market. All the talk by economists appears to be heading towards this being worse than the GFC. I expect a significant hit to real estate prices.
OCA should weather this storm the best of this sector but it could be a very severe event. I don't think the dividend is likely to be maintained at the previous level during this GFC MK2. Far to early to be overtly bullish in my opinion.

[Entrep]

Look at America - they are absolutely rooted. Heck even with our lockdown which is extreme by world standards, who knows if in 4 weeks things will be looking better, that is totally unclear. There was 60 people partying last night in Queenstown. All it takes is ONE person to undo the work of a nation.

Let alone places like the US where they run riot if anyone infringes on "muh rights" to liberty, freedom and guns. If the US goes down the world does, just the way it works no matter how well we are faring here.

[Blue Skies]

From what I'm hearing in Health sector, they're expecting a peak in about 10 days (possibly 1 of several) from all the people arriving back into the country from overseas who are now in self isolation. So we should expect increasing numbers in the coming days but should look at them in that context. i.e big difference between this and community spread from existing cases which would be much more alarming.

[Cyclical]

This post has nothing very little to do with OCA, but I feel this particular thread has attracted a smarter / positive crowd compared to some of those dominating the on more appropriate threads.

FWIW, I talked to 2 of my kids with over the weekend and as a result they switched their KiwiSaver from "balanced" to "growth" funds.

For any oldies here , it took 2 tick boxes and 1 minute.
Without doubt this "ease of switching" has partially contributed to the panic selling we saw last week (OCA diving to 40cents��) .
Anyway just sharing in case other parents on this forum also think this a good idea.

I've been in cash for my KiwiSaver for almost 2 years as have been expecting a correction for some time...obviously that decision cost me dearly last year, but only now are the markets back to the sort of levels at which I pulled out (when I thought things were overpriced), so the questions I keep asking myself are...is the economy in a worse state than 2 years ago? And if so, does the market reflect that? Like Beagle, I think we still have a long way to go...downwards. Having said that, for FOMO, I may consider putting a portion of my KiwiSaver into something more aggressive soon, to cover my bases.

[Ggcc]

There seems to be upward momentum on Oceania. Will we find directors buying many more shares and may this be at least a rise to IPO

[Chinesekiwi]

From what I'm hearing in Health sector, they're expecting a peak in about 10 days (possibly 1 of several) from all the people arriving back into the country from overseas who are now in self isolation. So we should expect increasing numbers in the coming days but should look at them in that context. i.e big difference between this and community spread from existing cases which would be much more alarming.

If we manage it as per how China is then the returning Kiwis will not effect community spread. They extremely enforce 14 day isolation and as such yesterdays 47 cases are all known and in isolation - if we can get to that efficiency level (we won't) then the climb in numbers will be managed well and will drop off and not effect community spread.

[Balance]

If we manage it as per how China is then the returning Kiwis will not effect community spread. They extremely enforce 14 day isolation and as such yesterdays 47 cases are all known and in isolation - if we can get to that efficiency level (we won't) then the climb in numbers will be managed well and will drop off and not effect community spread.

https://www.stuff.co.nz/dominion-post/news/120678551/coronavirus-drunken-antics-at-wellington-wedding-led-to-covid19-cluster

Already 7 clusters identified - be spreading like wildfire out there amongst the community.

Sad but reality government should have acted earlier.

[misterx]

If we manage it as per how China is then the returning Kiwis will not effect community spread. They extremely enforce 14 day isolation and as such yesterdays 47 cases are all known and in isolation - if we can get to that efficiency level (we won't) then the climb in numbers will be managed well and will drop off and not effect community spread.

Sorry this is off topic,
But, the Chinese government probably managed this disaster the worst compared to any other countries, not to mention when it first originated in China (or when we first start hearing it), the government tried to conceal everything and charging the doctors for spread of misinformation which I regard as crime against humanity (hundreds of thousand people will be killed at least who would not have been killed if it wasnt for this virus). They make the same mistakes over and over like a communist country. What happened then? The virus spread like a wildfire, doctors getting killed, people who raise voices (being doctor or journalist) disappearing, possibly covering up newer infection and death tolls and so on. So can you really believe what that communist government is saying at all? I found anyone who ever praise the chinese government in this are Chinese people only I come across. I find this really interesting.
I work in health sector and it has been one of the worst weeks ever, I fear this will get worse and worse globally for sometime at least.

[Baa_Baa]

The market optimism at the current share price, forecasting no further risk, seems overly optimistic to me. It’s only just beginning. Another private rest home today tests positive a staff member. I’m hanging onto my cash in anticipation of better buying later rather than sooner.

[Balance]

Off topic - deleted

[misterx]

Really?

China definitely & unquestionably handled the outbreak initially with all the finesse of an overweight butcher doing a ballet dance, but the drastic actions they subsequently took have not only worked but gave the rest of the world time to prepare - which as we have seen with the US, Italy, Spain, Australia & NZ (the two stooge countries of the US), these countries squandered the time given.

https://www.stuff.co.nz/national/health/coronavirus/120427038/the-detail-how-did-china-contain-the-coronavirus

The writer of the article and members of the WHO (especially the observation team from the US) who praised China’s efforts are non-Chinese or Chinese?

https://www.sciencemag.org/news/2020/03/china-s-aggressive-measures-have-slowed-coronavirus-they-may-not-work-other-countries


Yes, now I do admit I might have exaggerated a little and surely not all Chinese people will think the same way under the supreme leader. This is totally anecdotal, however, from my experience, seeing from my Chinese friends and colleagues, many Chinese people do feel very much so proud of their country, sometimes too much for things which can be debatable. It almost feels like an inferiority complex since the country itself developed so quickly in short period of time. Perfect example is this COVID19.

They should now have much experience on infectious disease breakouts (remember SARS?) but they still let this happen by making same mistakes. I remember WOH criticizing heavily on China concealing and covering up the disease which is now almost 20 years ago. So much more people have suffered and passed with COVID19 today and what does the Director-general of WHO do? goes travel to China just to praise what the country is doing disregarding all of their unethical and inhuman ways of covering this up not mentioning any of the virus's scientific origin too, which is fine because how to deal with the problem is more important. By the way, the head of the WHO is well supported by the Chinese communist party and is how he became appointed.

When I read those articles, it gives me feeling of more negativeness and uncertainties of the government because if there is any possibility of their reports of containment is false (which is possible given their communism characteristic and past record), and if you take that bit out, are they really praising, it should be completely opposite. The country is using extreme measures (using guns, refusing to diagnose and treat people to meet the standard of 0 new patient and giving up on certain patients who have low chance of survival by putting them in a bag and cremating them alive) and privacy breach everyday. Imagine being watched where you are and what you do every single minute.

As much as I would like to believe their success stories with the COVID19 from the Chinese government, all they care about is their image to the outside world and blame others for the virus, I would not bet my money on it and surely not my life.

[youngatheart]

??? I'm struggling to find how this is relevant to OCA...

[misterx]

China definitely & unquestionably handled the outbreak initially with all the finesse of an overweight butcher doing a ballet dance, but the drastic actions they subsequently took have not only worked but gave the rest of the world time to prepare - which as we have seen with the US, Italy, Spain, Australia & NZ (the two stooge countries of the US), these countries squandered the time given.

That is a very positive view which I admire and is somewhat true. However, their intention was not to give us the time which could have been a lot more if they hadn't covered it up in the first place and ignored all the warnings. It was when they finally found out that this thing can spread like wildfire and it can kill. Look at some of those European countries and the US. Nature is that, people don't care until it actually hit them hard as they do not want to be behind economically. And also because people get false reassurance into thinking this is just like flu, only about at least 10 times worse when you look at South Korea's stat.

[Cyclical]

China definitely & unquestionably handled the outbreak initially with all the finesse of an overweight butcher doing a ballet dance, but the drastic actions they subsequently took have not only worked but gave the rest of the world time to prepare - which as we have seen with the US, Italy, Spain, Australia & NZ (the two stooge countries of the US), these countries squandered the time given.

That is a very positive view which I admire and is somewhat true. However, their intention was not to give us the time which could have been a lot more if they hadn't covered it up in the first place and ignored all the warnings. It was when they finally found out that this thing can spread like wildfire and it can kill. Look at some of those European countries and the US. Nature is that, people don't care until it actually hit them hard as they do not want to be behind economically. And also because people get false reassurance into thinking this is just like flu, only about at least 10 times worse when you look at South Korea's stat.

Yep, I don't think it would have made a great deal of difference to most countries if they'd known about it 1 or 2 months earlier. Most countries have been in denial (no we can't subject our people and economy to those restrictions, it's just a flu) and it's been mostly a joke until people start popping off left, right and center, at which point it's too late and you realise you don't have the medical resources, even though you've had 2 months to gear up for it. Human nature. NZ has been afforded some luxuries other countries haven't, and yet it's questionable if we've acted quick enough and if enough of us are serious about it...I guess we'll soon find out.

Sorry, more off topic. OCA seems to be holding up well in the 60s.

[Playa]

I'm not so sure real estate prices will take such a big hit,after the GFC prices in Auckland began to surge,I'm not saying that will happen now,but there must be many kiwis returning home now from overseas who realize that NZ is possibly the best place to be at the moment.Also where to people park there money now?Many will see the markets as too risky now and you get nothing at the bank....just a thought

[Beagle]

I'm not so sure real estate prices will take such a big hit,after the GFC prices in Auckland began to surge,I'm not saying that will happen now,but there must be many kiwis returning home now from overseas who realize that NZ is possibly the best place to be at the moment.Also where to people park there money now?Many will see the markets as too risky now and you get nothing at the bank....just a thought

Yes, No, Maybe. Last time I looked at this, real estate prices per capita in Auckland made it the third most expensive city in the world. Some people might argue that we need a good depression so ordinary folks can afford a home again. I have a bit of sympathy with that point of view.

[mfd]

I'm not so sure real estate prices will take such a big hit,after the GFC prices in Auckland began to surge,I'm not saying that will happen now,but there must be many kiwis returning home now from overseas who realize that NZ is possibly the best place to be at the moment.Also where to people park there money now?Many will see the markets as too risky now and you get nothing at the bank....just a thought

This isn't quite true. According to REINZ median price records, Auckland basically flat lined from late 2007 until late 2011, then picked up. So, prices did not surge until around 4 years after the GFC. A long time to sit on a property with low yield, although the low interest rates will help with that.

Personally I wouldn't be surprised to see a worse result for Auckland housing this time as the starting point is so expensive and the economy could be pretty knocked up.

[macduffy]

It seems to me that the property market will be essentially "frozen" for a period. A sort of its own lockdown. No open home Sundays; little movement around the country in the labour market; no immigration; banks are being encouraged to forbear on mortgage repayments meanwhile.

Likely to be a burst of pent-up activity when the lockdown is over. We'll have to see then how such demand v supply plays out and how it affects retirement sector companies such as OCA.

[Beagle]

This isn't quite true. According to REINZ median price records, Auckland basically flat lined from late 2007 until late 2011, then picked up. So, prices did not surge until around 4 years after the GFC. A long time to sit on a property with low yield, although the low interest rates will help with that.

Personally I wouldn't be surprised to see a worse result for Auckland housing this time as the starting point is so expensive and the economy could be pretty knocked up.

A lot of people don't see property flatlining for ages as a loss but it really is.
RBNZ data shows inflation from the fourth quarter of 2007 to the same quarter in 2011 was 11.7%. That's a pretty hefty decrease in real inflation adjusted terms. We could easily see the same or worse.

[rooster]

That was a big share disposal by the former CFO. Over 1M :scared:

[tzbang]

That was a big share disposal by the former CFO. Over 1M :scared:

Former? Matthew Ward still is CFO isn't he?

[DazRaz]

And at 45c....

[Cadalac123]

Wow that's got to be painful for the previous CFO lol sold some on the dot of the current "bottom"

[Balance]

And at 45c....

Maybe he knows something others don't - as an ex-insider?

[Cadalac123]

Maybe he knows something others don't - as an ex-insider?

Yeah always tricky with interpreting these .
Does he know about a huge industry headwind?
Or did he sell out for personal cash holding obligations?
Or did he sell because he thought it would crash further ?

[Entrep]

Maybe he knows something others don't - as an ex-insider?

Let's look at stock 101 basics. What does insider selling suggest to you?

[blackcap]

Let's look at stock 101 basics. What does insider selling suggest to you?

Insider selling suggests not so good things. But insider buying to me is a stronger indicator than insider selling. There have also been quite a few insider buys on this stock recently. Hard to balance the two so to speak. There are often genuine reasons for insider sells (like building a new deck) so I put more weight on insider buys. That said, he did sell a heck of a lot of OCA.

[Cyclical]

He's still holding 200k of them, if that's any indicator. Really bad timing for him to sell so many, but who knows what's behind it, maybe another business venture or opportunity looked too good to miss.

[peat]

did anyone mention capitulation?

[Cadalac123]

Absolutely brutal market for those that bought stocks on leverage.. such a tempting strategy though especially at dips, but risk is enough to get you out of the game completely

[Leftfield]

Absolutely brutal market for those that bought stocks on leverage.. such a tempting strategy though especially at dips, but risk is enough to get you out of the game completely

Not nice, but important learning lesson.

FWIW I've been bitten by it in 1990's and vowed never to use leverage again for share investment. My golden rule now is to invest only funds that I'm not going to need for at least 5 years.

It's worked a treat and no stress (even in the current market my 5yr av % pa returns much better than managed funds or NZX50.)

[Cadalac123]

Not nice, but important learning lesson.

FWIW I've been bitten by it in 1990's and vowed never to use leverage again for share investment. My golden rule now is to invest only funds that I'm not going to need for at least 5 years.

It's worked a treat and no stress (even in the current market my 5yr av % pa returns much better than managed funds or NZX50.)

Yeah... I have to be lying to say I wasn’t heavily tempted during this downturn but not worth it.. maybe a leveraged ETF is better ! Like tqqq 😂

[Meister]

DCA is supposed to be the gold standard for safe re-entry, but I have regrets here. 40c was too good an opportunity, and I held back. Got some, but could have got a LOT more. Could it have dropped further? Maybe, but the value was clear, and I was happy to enter at those prices.

The lesson is a little biased by the fact that the price has turned around so quickly and come back up, but I am questioning the strategy in these circumstances. Regular buying of smaller amounts just doesn't always make sense. If you have a high conviction, are trying to build up a larger position, and the value meter starts screaming... why go in small? It is a question of risk vs reward. DCA is to de-risk your entry, but if the risk/reward ratio is already skewed heavily in your favour by panic selling or thoughts of armageddon, then the need to de-risk your entry is far less than usual.

Hopefully things crash back down to sub 50 again so I can get another chance!

[Cyclical]

Hopefully things crash back down to sub 50 again so I can get another chance!

We remain ever hopeful haha. Hindsight... We might be back down that way again if there is a serious outbreak in one or two of the facilities, but I for one hope it doesn't come to that.

[Cadalac123]

DCA is supposed to be the gold standard for safe re-entry, but I have regrets here. 40c was too good an opportunity, and I held back. Got some, but could have got a LOT more. Could it have dropped further? Maybe, but the value was clear, and I was happy to enter at those prices.

The lesson is a little biased by the fact that the price has turned around so quickly and come back up, but I am questioning the strategy in these circumstances. Regular buying of smaller amounts just doesn't always make sense. If you have a high conviction, are trying to build up a larger position, and the value meter starts screaming... why go in small? It is a question of risk vs reward. DCA is to de-risk your entry, but if the risk/reward ratio is already skewed heavily in your favour by panic selling or thoughts of armageddon, then the need to de-risk your entry is far less than usual.

Hopefully things crash back down to sub 50 again so I can get another chance!

That’s just hindsight .
You have no idea where the price would have ended up there were no reliable support levels since it dropped below IPO price .

With that logic you could have thought 60c was a steal too while it was going down .

Don’t beat yourself over it and remember that how much you put in is personal portfolio size based and DCA doesn’t mean put tiny amounts in each time it means lowering your average holding cost and you can do that whatever way you want but the reality is you think 40c was the ideal price but it’s got no basis .

Furthermore the price surges are driven by institutions it’s not smart to think you’ll time it better than them so in hindsight every price looked like a great entry but it’s only a great entry if a big institution thought it was . Long term 60 and 40c entries won’t make any difference .

My entry was purely luck based and I wont even act like I modeled the price as being ideal entry

[Meister]

That’s just hindsight .
You have no idea where the price would have ended up there were no reliable support levels since it dropped below IPO price .

With that logic you could have thought 60c was a steal too while it was going down .

Don’t beat yourself over it and remember that how much you put in is personal portfolio size based and DCA doesn’t mean put tiny amounts in each time it means lowering your average holding cost and you can do that whatever way you want but the reality is you think 40c was the ideal price but it’s got no basis .

Furthermore the price surges are driven by institutions it’s not smart to think you’ll time it better than them so in hindsight every price looked like a great entry but it’s only a great entry if a big institution thought it was . Long term 60 and 40c entries won’t make any difference .

My entry was purely luck based and I wont even act like I modeled the price as being ideal entry

Hindsight, and this particular situation, definitely makes this thought biased. But the idea remains... if you want a 50k position, and the price seems right, you can either dump it all in, or DCA it in with five 10k purchase over 5 weeks, or ten 5k purchases over 10 weeks (or whatever time/schedule you want). The reasons for DCA'ing it in are to spread your entry over time so that you average out your entry, and reduce the risk of buying right before a drop.

The idea behind my post isn't really intended to be one of trying to time the market (although I see that it practically is that), its one of assessing the reasons for doing the DCA in the first place (risk reduction) in the light of the current situation and your valuation of the company. It may not be optimal to dump it all in once, but when the risk/reward ratio is heavily skewed in your favour (which I think is still true at 60c, but was 'unbelievable value' at 40c) then you may want to adjust your DCA strategy to take that into account. It might be better to do larger purchases, more frequently. It might be better to break from your strategy to make an off-schedule purchase because things are looking fantastic.

Its true you can still get it wrong, and it may still go down. That is up to you and your own valuation of the company to decide how you want to play it. The potential downside at 60c is a lot less than the upside. The downside at 40c is tiny compared to the upside. I think our entry strategies need to take that into account.

In saying that, over the very long term perspective, you are correct that 40c or 60c may not really matter :)

[macduffy]

It depends very much on the liquidity of the stock, of course. Hitting a thinly traded one with a bid for 50,000 would usually see a spike in the offer. I realise that's not the case with OCA but mention it as one aspect to be considered.

[Beagle]

https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12321221

Mike Taylor suggests buying a little bit on the very bad days. Might dip another claw, (from the same paw as last time), in the water on the next big dipper. Definitely won't be diving in and swimming in it dog paddle style, anytime soon.

[winner69]

https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12321221

Mike Taylor suggests buying a little bit on the very bad days. Might dip another claw, (from the same paw as last time), in the water on the next big dipper. Definitely won't be diving in and swimming in it dog paddle style, anytime soon.

That Mike is a graduate of Sharetrader

A few bright people graduated from here to do well in funds management. Dimebag was another one.

[Cyclical]

https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12321221

Mike Taylor suggests buying a little bit on the very bad days. Might dip another claw, (from the same paw as last time), in the water on the next big dipper. Definitely won't be diving in and swimming in it dog paddle style, anytime soon.

Interesting read that, thanks.

[Beagle]

That Mike is a graduate of Sharetrader

A few bright people graduated from here to do well in funds management. Dimebag was another one.

Good on him. Makes me wonder if I should have started my own firm years ago when I was a younger dog. I'd really enjoy writing newsletters articulating how one needs to take a dogged approach or even sometimes be dogmatic in your approach or ensure you dig under every rock and lets not ever forget the benefits of being a dividend hound. Could call it the Kennel Club Investments Ltd :)

[SailorRob]

It's never too late and you can't teach an old dog new tricks which in your case would be a very good thing as it's the old tricks that keep you winning.

[nevchev]

Bulldog Investments....rough rough

[Beagle]

Bulldog Investments....rough rough

:lol:

Thanks SailorRob :)

[macduffy]

Good on him. Makes me wonder if I should have started my own firm years ago when I was a younger dog. I'd really enjoy writing newsletters articulating how one needs to take a dogged approach or even sometimes be dogmatic in your approach or ensure you dig under every rock and lets not ever forget the benefits of being a dividend hound. Could call it the Kennel Club Investments Ltd :)

Yes, Beagle. It seems there's no limits to a dog's talents!

;)

[Ggcc]

Someone is obviously wanting to get out in a hurry. Very fortunate to have bought in mid 50cent. Will that level return??? I do think so if this downward pressure continues. Great time to be filling the boots on this one if it returns to those levels I feel.

[Valiant]

Someone is obviously wanting to get out in a hurry.

Hi Ggcc, what gives you that impression? Is it the buy/sell depth's?

[Bjauck]

Yes, Beagle. It seems there's no limits to a dog's talents!

;) We are in a time when the cadaver dogs are sniffing around.

[Ggcc]

Hi Ggcc, what gives you that impression? Is it the buy/sell depth's? Everyday there are large purchase orders and near early afternoon they get sold and we drop another cent. 400,000+ shares were sold @$0.65 at 2.10pm. Similar amounts on Friday and I believe Thursday, each day dropping 1 cent. Either someone getting out or someone trading large amount of shares which may have been purchased at 40 cent+.

Only time will tell. I still feel a great longterm hold for now.

[Cyclical]

Everyday there are large purchase orders and near early afternoon they get sold and we drop another cent. 400,000+ shares were sold @$0.65 at 2.10pm. Similar amounts on Friday and I believe Thursday, each day dropping 1 cent. Either someone getting out or someone trading large amount of shares which may have been purchased at 40 cent+.

Only time will tell. I still feel a great longterm hold for now.

True, I did see there was support for circa 400k@.65 before 2pm, that has now been wiped out... Interesting.

[Valiant]

Everyday there are large purchase orders and near early afternoon they get sold and we drop another cent. 400,000+ shares were sold @$0.65 at 2.10pm. Similar amounts on Friday and I believe Thursday, each day dropping 1 cent. Either someone getting out or someone trading large amount of shares which may have been purchased at 40 cent+.

Only time will tell. I still feel a great longterm hold for now.

Right on. Thanks.
I was lucky to pick up a parcel at 40c and if I get the chance at around 50c I will take it.

[cymonger]

Feels like we're a little stuck in the mud with this one right now. Based on the depth that I've been tracking for a few weeks, there are many more buyers than sellers, and yet the price inches down on days like this, even as others soar. Feels like manipulation to me. Moving this out of the short-term trader into long-term holder basket now. Feel like it will be back to a dollar within a year or two time frame, which is 50% upside from here. Hard to find better returns than that.

P.S. Proud of the way New Zealand is handling this (barring the moronic health minster and some bad apples). Two family members in the states have already had the virus (they are better now). But the difference between the way the two countries have handled things is apparent to me.

[Ggcc]

Feels like we're a little stuck in the mud with this one right now. Based on the depth that I've been tracking for a few weeks, there are many more buyers than sellers, and yet the price inches down on days like this, even as others soar. Feels like manipulation to me. Moving this out of the short-term trader into long-term holder basket now. Feel like it will be back to a dollar within a year or two time frame, which is 50% upside from here. Hard to find better returns than that.

P.S. Proud of the way New Zealand is handling this (barring the moronic health minster and some bad apples). Two family members in the states have already had the virus (they are better now). But the difference between the way the two countries have handled things is apparent to me.
Might be correct. We are back up to 69 cents. Who knows but as you indicated a longterm hold.

[Maverick]

Check out this Oceania "Sands" video ( needs to open through Facebook)
https://m.facebook.com/story.php?story_fbid=220002685945178&id=1561603830798871


Looks like the prediction that retirement villages being the worst place to be in this crisis might not quite be accurate.


Also , for those that don't know, this building was delivered empty 10 months ago. Oceania expect these new developments to take 18 months to fill. Looks like 90 % filled in the video already. ( Bear in mind that level 2 are the care suites so we can't really expect them to be leaping around.)


All of those happy clients are having their upfront fees DMF’d each month for the next 2.5-3 years, well after NZ has settled back to normal.


Good on you OCA for continuing to deliver an outstanding experience.

[cymonger]

Might be correct. We are back up to 69 cents. Who knows but as you indicated a longterm hold.

Yes, I must admit I've had a bit of activity bias during the lockdown. I suspect others have as well. Lots more time to stare at screens, and check the markets and message boards. (although to be fair, many of the people on these forums do that at work anyway.)


See you at a dollar! I'm just gonna add on the dips now. Suspect we could see 60 or even lower again, but who knows? I was reading today about how much things have changed since the last couple of crashes, as algorithms, Institutional manipulation, and passive investing dominate the market now. Very interesting food for thought for me. The sharemarket is a different animal than the economy. Still strongly connected of course, but perhaps less intertwined that they used to be given all of the forces I mentioned.

[nztx]

Might be correct. We are back up to 69 cents. Who knows but as you indicated a longterm hold.

Wait until the broker's customers all load up, then some broker firms might be prepared to add it to their tip sheets again with what they regard to be a fairly inflated price ..

[winner69]

Wait until the broker's customers all load up, then some broker firms might be prepared to add it to their tip sheets again with what they regard to be a fairly inflated price ..

Always good to be tipped in Raceform and Best Bets ... gives punters extra confidence they on to a winner

[fish]

Always good to be tipped in Raceform and Best Bets ... gives punters extra confidence they on to a winner

Looks in good form today.

[winner69]

Looks in good form today.

Running out it’s rightful grade ...might fade as race goes on.

[Cyclical]

Wow, some lucky punters would have doubled their money in little over 2 weeks.

[TobyPascoe92]

Does anyone think this is going to be as affected as it was in Feb/Mar, when everything crashed, if the market as a whole takes another dip in the coming months?

[sb9]

Wow, some lucky punters would have doubled their money in little over 2 weeks.

Wonder how that former CFO who sold out most of his lot at 40c feeling now??

[Cyclical]

Does anyone think this is going to be as affected as it was in Feb/Mar, when everything crashed, if the market as a whole takes another dip in the coming months?

I doubt we'll see south of 60c again. At that stage it was sell everything panic, plus there was the fear that C19 might cause a whole lot of pain should it get into the villages...I think the market has come to terms with that now and it's priced in to an extent.

[Ggcc]

I doubt we'll see south of 60c again. At that stage it was sell everything panic, plus there was the fear that C19 might cause a whole lot of pain should it get into the villages...I think the market has come to terms with that now and it's priced in to an extent.

Please don't ever say ever, as I was one of the ones who topped up a little at those prices and will continue to top up at those levels if they came back again........ The average I picked up would be somewhat below 60 cents. I brought my average down somewhat. Still in the red for now, but not far to go.

[peat]

I see the price is back to IPO level.

11242

[youngatheart]

Could we have now passed through the worst of it? With only 29 infected offset by 35 recovered is it possible that we'll be the only western country to make it through with very little death.
80c is still -20% of NTA.

[youngatheart]

I like what someone else was saying earlier, "if its cheap, buy it!"

[BlackPeter]

Could we have now passed through the worst of it? With only 29 infected offset by 35 recovered is it possible that we'll be the only western country to make it through with very little death.
80c is still -20% of NTA.

You are referring to the COVID-19 cases in NZ, I presume? Well, yes, we might have reached some plateau, will drop from here in a week or two and with a lot of luck we might not have a second (and third) wave.

If you are however referring to whether the worst of the bear market has passed ... honestly, I doubt it. Markets clearly in denial about the economical impact of the lock down in something like 50% of all world markets (including NZ). Huge drop of earnings for many companies and lots of them will go kaputt. Stock prices really expensive based on forward earnings these days. Might kill some banks as well - and just think what the huge jump in debts (to pay all these relieve packages) will do to countries balance sheets. Spain, Italy and the UK not being able to repay their debts anyone?

If all of this results in property prices crashing, than this won't be good for retirement stocks. On the other hand - all the cheap money currently produced by reserve banks around the world might as well pop up stock and property prices (as it did last time).

Which of these two effects will be stronger? Well, your guess is as good as mine.

[Bjauck]

... Stock prices really expensive based on forward earnings these days. Might kill some banks as well - and just think what the huge jump in debts (to pay all these relieve packages) will do to countries balance sheets. Spain, Italy and the UK not being able to repay their debts anyone?

If all of this results in property prices crashing, than this won't be good for retirement stocks.... Some huge Coovid packages have been thrown around. Add France to that trio of large European debtors. The UK Public debt to GDP is 85%; The French Public debt to GDP is 100%. (Germany's is at 60%)

https://www.marketwatch.com/story/the-uk-is-right-to-throw-fiscal-caution-to-the-wind-heres-why-2020-03-12

[nztx]

You are referring to the COVID-19 cases in NZ, I presume? Well, yes, we might have reached some plateau, will drop from here in a week or two and with a lot of luck we might not have a second (and third) wave.

If you are however referring to whether the worst of the bear market has passed ... honestly, I doubt it. Markets clearly in denial about the economical impact of the lock down in something like 50% of all world markets (including NZ). Huge drop of earnings for many companies and lots of them will go kaputt. Stock prices really expensive based on forward earnings these days. Might kill some banks as well - and just think what the huge jump in debts (to pay all these relieve packages) will do to countries balance sheets. Spain, Italy and the UK not being able to repay their debts anyone?

If all of this results in property prices crashing, than this won't be good for retirement stocks. On the other hand - all the cheap money currently produced by reserve banks around the world might as well pop up stock and property prices (as it did last time).

Which of these two effects will be stronger? Well, your guess is as good as mine.

it will be interesting to see how soon the reserve banks get the mop out to swipe some of the surplus ca$h back out of their goldfish bowls
and then what interest rates do..

[fish]

Some huge Coovid packages have been thrown around. Add France to that trio of large European debtors. The UK Public debt to GDP is 85%; The French Public debt to GDP is 100%. (Germany's is at 60%)

https://www.marketwatch.com/story/the-uk-is-right-to-throw-fiscal-caution-to-the-wind-heres-why-2020-03-12

Oceania has been devalued.
At this stage is cash king?
Or will cash be devalued?
It looks as if Oceania will keep paying dividends
What do you feel will happen to interest rates?

[Baa_Baa]

The positive result was not correct. (https://www.stuff.co.nz/national/health/coronavirus/120957539/coronavirus-covid19-testing-mixup-at-rest-home-leads-to-unnecessary-anguish)

[TobyPascoe92]

Humming and harring at the moment over if we are going to see OCA go down again with all the news about rest-homes and villages in the last 4-5 days... 80 cents is nicely below NTA but 60cents would be nice again! Thoughts?

[Cyclical]

Humming and harring at the moment over if we are going to see OCA go down again with all the news about rest-homes and villages in the last 4-5 days... 80 cents is nicely below NTA but 60cents would be nice again! Thoughts?

More of a long term hold proposition now at this price I think. There will be plenty more like you and I queuing up to get in in the 6x range again, if it should get down there. I think the market has already factored in the idea already that these companies may see the odd outbreak.

[Beagle]

Humming and harring at the moment over if we are going to see OCA go down again with all the news about rest-homes and villages in the last 4-5 days... 80 cents is nicely below NTA but 60cents would be nice again! Thoughts?


Discount to NTA at OCA is 21%. Some impact to NTA from this Virus ?...so the true discount to adjusted post virus NTA is perhaps not really 21% but something perhaps materially less ? For what its worth I would be happy to buy more in the 60's but not in the 80's and will probably sit and be a dog, (possum ?), in the headlights in the 70's.

P.S. Some economists thoughts here are quite interesting. All expecting at least a 6% reduction in real estate values. https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12322288

[TobyPascoe92]

Thanks Beagle, always appreciate your thoughts & advice.

[allfromacell]

Lol you've got to feel for Matthew Ward selling all those shares for half the value of today's SP. Probably for the best he's the former CFO.

[bull....]

40c to 88c lol the madness of the market sometimes or is it the money printing

[Ggcc]

40c to 88c lol the madness of the market sometimes or is it the money printing
I agree for the short term the rise was too fast, but my guess within 6 months this will be back around $1 or higher.

[bull....]

I agree for the short term the rise was too fast, but my guess within 6 months this will be back around $1 or higher.

guess the virus will determine that.

[Ggcc]

guess the virus will determine that.
Agreed with that

[Beagle]

I got a few at 60 cents, not enough with the benefit of hindsight. Those buying at 40 cents when the virus looked like it might have a massive effect on this sector should give themselves a good pat on the back, well done.

I have a very strong preference for MET where it is now compared to OCA in the 80's. Adjusted for the much lower virus risk environment currently presiding, given we're right out the other side of the bell curve, I think MET at $3.77 are doing a very good job of mimicking the extreme value OCA presented at 40 cents.

Sure MET aren't at a 60% discount to NTA, (like OCA were at 40 cents), but they're at a 46% discount and taking into account the much lower current risk environment I think that's an extraordinary opportunity.

OCA in the mid 80's on the other hand is probably only trading at 5-10% discount to virus adjusted NTA.

[Cadalac123]

I got a few at 60 cents, not enough with the benefit of hindsight. Those buying at 40 cents when the virus looked like it might have a massive effect on this sector should give themselves a good pat on the back, well done.

I have a very strong preference for MET where it is now compared to OCA in the 80's. Adjusted for the much lower virus risk environment currently presiding, given we're right out the other side of the bell curve, I think MET at $3.77 are doing a very good job of mimicking the extreme value OCA presented at 40 cents.

Sure MET aren't at a 60% discount to NTA, (like OCA were at 40 cents), but they're at a 46% discount and taking into account the much lower current risk environment I think that's an extraordinary opportunity.

OCA in the mid 80's on the other hand is probably only trading at 5-10% discount to virus adjusted NTA.

Yeah, 40c was ridiculous. I think 80c-1$ is more than close to "fair value" from an IV perspective, until we get more consolidated forecasts and numbers.

Will be interesting to see how MET behaves. I think from a general perspective this sector is one heavily favoured by institutes and will probably prevail as our economies "long-standers", with demand not going out of the door anytime soon. I do somewhat favour ARV - however from a price action perspective its not really trading at a discount but fundamentally and balance sheet wise looking somewhat solid.

[Beagle]

I'd rather sit on cash than pay full price for shares like ARV. Massive value or I'm happy to keep my powder dry.

[Cyclical]

Just thinking aloud here as in two minds about this one atm. It's been a good run and I'm wondering if it's time to bank the profits and build up the powder store for the other bargains that are around the corner, or maybe redirect those funds to a certain other bargain stock in the sector? Or should I just park these OCA ones in the bottom drawer for the long term? I'm thinking I should exercise some patience and do the latter. And if that proves to be a bad move and it drifts lower during the recession, well I guess I'll add some more. I guess in an effort not to be classified as a trader by the IRD, I should also just sit on them. What are others thoughts?

Not sure if it's been captured earlier in the thread, but in today's 1pm C19 update, there was talk of helping out the care providers towards the extra costs incurred with lockdown measures, which is good to hear.

[Longhaul]

Just thinking aloud here as in two minds about this one atm. It's been a good run and I'm wondering if it's time to bank the profits and build up the powder store for the other bargains that are around the corner, or maybe redirect those funds to a certain other bargain stock in the sector? Or should I just park these OCA ones in the bottom drawer for the long term? I'm thinking I should exercise some patience and do the latter. And if that proves to be a bad move and it drifts lower during the recession, well I guess I'll add some more. I guess in an effort not to be classified as a trader by the IRD, I should also just sit on them. What are others thoughts?

Well I've been pondering the exact same thing today and decided to sell half of what I bought at average of 43 cents. I feel like there will be better buying opportunities elsewhere. If I was thinking about buying in OCA now, I probably wouldn't at these prices, so that reasoning helped me make up my mind. I also picked up some MET at $3.25 and may move the profits into more MET. (From a TA perspective on OCA it also looked to me like the upswing had lost steam, another reason to sell half).

[youngatheart]

$1 today perhaps?

[macduffy]

Yes, cyclical and Longhaul, the classic dilemma. When to take a quick profit, when to stay the course. At times like this, I listen to Kenny Rogers singing "The Gambler". I'm not a good poker player but a bit better an investor and I'm staying!

:)

[Cyclical]

Yes, cyclical and Longhaul, the classic dilemma. When to take a quick profit, when to stay the course. At times like this, I listen to Kenny Rogers singing "The Gambler". I'm not a good poker player but a bit better an investor and I'm staying!

:)

Sound advice there macduffy :)

I've revised my sell price up to something optimistic and will let the market decide from here...

[Beagle]

Just thinking aloud here as in two minds about this one atm. It's been a good run and I'm wondering if it's time to bank the profits and build up the powder store for the other bargains that are around the corner, or maybe redirect those funds to a certain other bargain stock in the sector? Or should I just park these OCA ones in the bottom drawer for the long term? I'm thinking I should exercise some patience and do the latter. And if that proves to be a bad move and it drifts lower during the recession, well I guess I'll add some more. I guess in an effort not to be classified as a trader by the IRD, I should also just sit on them. What are others thoughts?

Not sure if it's been captured earlier in the thread, but in today's 1pm C19 update, there was talk of helping out the care providers towards the extra costs incurred with lockdown measures, which is good to hear.

FWIW - Notwithstanding the substantial price difference between OCA and MET, I have quite a lot more MET shares than OCA. I am inclined to add more to MET at prevailing current prices and disinclined to add more OCA.

[Cyclical]

FWIW - Notwithstanding the substantial price difference between OCA and MET, I have quite a lot more MET shares than OCA. I am inclined to add more to MET at prevailing current prices and disinclined to add more OCA.

In the same boat TBH, have 3x as much MET in dollar terms. Just about finished selling down everything else because the values are just too crazy. If OCA hits the high price I've put on the sell order, then that's great, otherwise I'll just sit on them. Can't say I'm too happy with my lack of diversification ATM, but what can you do.

[Curly]

Don’t you think OCA has a better and quicker prospect of doubling their price from here than MET?

[Beagle]

Sometimes the best thing is to be patient and do nothing. I wouldn't want to be broadly diversified in this market, there simply aren't enough shares trading at a bargain price below or in line with the underlying fundamental performance of the economy. I've been investing for nearly 40 years and apart from the odd pocket of fair value like this and deep value like MET and high growth opportunities at realistic prices like PAZ I have never seen the overall market so divorced from the underlying fundamental economic reality. That screams at me to stay out and let economic reality bite which won't happen overnight, but it will happen eventually.

[Ecks]

Sometimes the best thing is to be patient and do nothing. I wouldn't want to be broadly diversified in this market, there simply aren't enough shares trading at a bargain price below or in line with the underlying fundamental performance of the economy. I've been investing for nearly 40 years and apart from the odd pocket of fair value like this and deep value like MET and high growth opportunities at realistic prices like PAZ I have never seen the overall market so divorced from the underlying fundamental economic reality. That screams at me to stay out and let economic reality bite which won't happen overnight, but it will happen eventually.

PAZ?
As for the divorced fundamentals, couldn't agree more just look at what is happening to AIR right now! A great link table view of bear markets and their relative # of trading days is compelling, take into account market sentiment around what is an inevitable extension of being required to work and stay home I predict the bear market low to be right on the cusp of entering Q3 (End of June). The market will readjust, the driving factor of the weeks bounce must eventually be pulled down by the anchor that is the balance sheet most of those semi-functional businesses like AIR will be showing poor results.
# of trading days from Entering Bear Market to Bear Market Low Average 83 days, Bear Market low to Exit Bear Market average 63 days! (https://www.marketwatch.com/story/the-dow-just-tumbled-into-a-bear-market-ending-the-longest-bull-market-run-in-historyheres-how-those-downturns-last-on-average-2020-03-11)

[Beagle]

Thanks for the link Ecks. More on PAZ here https://www.sharetrader.co.nz/showthread.php?8378-PAZ-Pharma-Zen

[Cadalac123]

Thanks for the link Ecks. More on PAZ here https://www.sharetrader.co.nz/showthread.php?8378-PAZ-Pharma-Zen

Agree beagle. Market is currently trading with too high volatility to trade with large portfolio sums,

I only hold 3 positions right now and all are heavily based on fundamentals and were entered on notable margin of safety

I will refrain diversifying until the market stabilises as I’m not keen on getting trapped on artificial spikes which will smooth out long term

[Ecks]

Ah found PAZ on the unlisted securities exchange, it confirms a fellow ST member just bought $12.5k worth! Not bad for 50k shares

[percy]

Ah found PAZ on the unlisted securities exchange, it confirms a fellow ST member just bought $12.5k worth! Not bad for 50k shares

The largest shareholder, together with other large shareholders,live in Wanaka.
Perhaps they are your neighbours .?

[Cyclical]

There's a lot more on the sell side of the ledger today...bit of profit taking going on?

11305

[Food4Thought]

I don't understand how the price has bounced rapidly for OCA.

A young fish, in a big pond.

Without qualified data for this recovery.

We are living in a overcooked smoking hot pot oil bounce.... like a out of control projectile, before it has lost the energy and potential heat and settled.

Averaged down selling will 100% be happening at this price.

So many people moving houses, exiting leases, leaving apartments, moving home (in Australia and NZ) where ever home is.

Rest home and care facility costs will have changed. The winter is not in full swing yet

Goodluck, keeping my powder very dry for this drenching

[Poet]

I don't understand how the price has bounced rapidly for OCA.

A young fish, in a big pond.

Without qualified data for this recovery.

We are living in a overcooked smoking hot pot oil bounce.... like a out of control projectile, before it has lost the energy and potential heat and settled.

Averaged down selling will 100% be happening at this price.

So many people moving houses, exiting leases, leaving apartments, moving home (in Australia and NZ) where ever home is.

Rest home and care facility costs will have changed. The winter is not in full swing yet

Goodluck, keeping my powder very dry for this drenching

I want some of what you are on

[Beagle]

I see OCA as about fear value at present, (sorry couldn't resist lame pun).

[nztx]

I see OCA as about fear value at present, (sorry couldn't resist lame pun).

Please try to be careful -- MET may be the beneficiary of greater attention..

[DarkHorse]

Sometimes the best thing is to be patient and do nothing. I wouldn't want to be broadly diversified in this market, there simply aren't enough shares trading at a bargain price below or in line with the underlying fundamental performance of the economy. I've been investing for nearly 40 years and apart from the odd pocket of fair value like this and deep value like MET and high growth opportunities at realistic prices like PAZ I have never seen the overall market so divorced from the underlying fundamental economic reality. That screams at me to stay out and let economic reality bite which won't happen overnight, but it will happen eventually.

I fully agree with you when it comes to NZX - looked expensive 2 months ago, and atm looks even more expensive factoring in inevitable slump. Perhaps the likes of SCL and SEK are exceptions? Along with PAZ which I'm also happy to hold. It's a different story on ASX - good small companies are far more likely to fly under the radar, smallords was pretty cheap to begin with, prices have fallen further and there are quite a few which, like PAZ, still have great prospects (or just way oversold - eg PPE)

[winner69]

Sometimes the best thing is to be patient and do nothing. I wouldn't want to be broadly diversified in this market, there simply aren't enough shares trading at a bargain price below or in line with the underlying fundamental performance of the economy. I've been investing for nearly 40 years and apart from the odd pocket of fair value like this and deep value like MET and high growth opportunities at realistic prices like PAZ I have never seen the overall market so divorced from the underlying fundamental economic reality. That screams at me to stay out and let economic reality bite which won't happen overnight, but it will happen eventually.

At least you not one of the delusionsl ones Beagle ...this guy reckons fsr too msny are delusional

https://www.smh.com.au/business/markets/delusional-investors-are-underestimating-the-economic-shock-the-world-is-facing-20200416-p54kc3.html

[Beagle]

At least you not one of the delusionsl ones Beagle ...this guy reckons fsr too msny are delusional

https://www.smh.com.au/business/markets/delusional-investors-are-underestimating-the-economic-shock-the-world-is-facing-20200416-p54kc3.html

Thanks Winner, some very sobering reading in there. No matter how ugly the reality of the situation is, its better to grasp the enormity of the situation than to cling to some forlorn hope that things will be back to normal sometime really soon.

Another commentator effectively saying investors are delusional and the markets adjusted for the forecast earnings decline have never been more expensive
https://www.goodreturns.co.nz/article/976516672/nz-shares-rise-as-investor-fomo-stokes-demand-for-beat-up-stocks.html?utm_source=GR&utm_medium=email&utm_campaign=GoodReturns+Market+Report+for+16+Apr+ 2020

[Hoop]

There's a lot more on the sell side of the ledger today...bit of profit taking going on?

11305

Yes profit taking using the Technical play...The Depth info showing high sell volumes around 86c-88c is exactly where the Chart EMA50 resistance line is.... A short/medium term investing strategy rule of thumb is sell near resistance and buy near support.This is a more successful play when it is a bear market (downtrend) and/or during a rectangle pattern (trading range/channel). During an uptrend Bull market this depth sell behaviour would not as strong.

[Cyclical]

Yes profit taking using the Technical play...The Depth info showing high sell volumes around 86c-88c is exactly where the Chart EMA50 resistance line is.... A short/medium term investing strategy rule of thumb is sell near resistance and buy near support.This is a more successful play when it is a bear market (downtrend) and/or during a rectangle pattern (trading range/channel). During an uptrend Bull market this depth sell behaviour would not as strong.

It's funny you should say that, as I did exactly that today. Ended up with 4% more shares for the same money. I'm calling it a self generated DRP :)

[Cyclical]

At least you not one of the delusionsl ones Beagle ...this guy reckons fsr too msny are delusional

https://www.smh.com.au/business/markets/delusional-investors-are-underestimating-the-economic-shock-the-world-is-facing-20200416-p54kc3.html

That's a scary read all right. Makes me pretty happy to be in NZ with our relatively conservative debt to GDP ratio. Most of the world has done a great job of digging a deeper and deeper hole since the GFC.

[Beagle]

That's a scary read all right. Makes me pretty happy to be in NZ with our relatively conservative debt to GDP ratio. Most of the world has done a great job of digging a deeper and deeper hole since the GFC.

Sometimes I can be a forgetful old mutt and forget the likely full extent and enormity of what it is we are facing so I've created a shortcut on my computer desktop to that article. I've named the shortcut "Reality Check" A really useful one for whenever I am making any investment decisions for at least the rest of 2020. Thanks for posting that article Winner. Keeps me very sober and focused on the extent of the problem.

[Cyclical]

Sometimes I can be a forgetful old mutt and forget the likely full extent and enormity of what it is we are facing so I've created a shortcut on my computer desktop to that article. I've named the shortcut "Reality Check" A really useful one for whenever I am making any investment decisions for at least the rest of 2020. Thanks for posting that article Winner. Keeps me very sober and focused on the extent of the problem.

Not a bad idea that. Hopefully I can exercise the same caution. Very easy to get caught up in the tide of enthusiasm that sees the likes of AIR going gangbusters, and lose sight of the imploding mess that lies ahead of us. Yep, thanks for the article, Winner.

[winner69]

That's a scary read all right. Makes me pretty happy to be in NZ with our relatively conservative debt to GDP ratio. Most of the world has done a great job of digging a deeper and deeper hole since the GFC.

...that shouldn’t make you happy ...our hole is pretty deep

[fish]

At least you not one of the delusionsl ones Beagle ...this guy reckons fsr too msny are delusional

https://www.smh.com.au/business/markets/delusional-investors-are-underestimating-the-economic-shock-the-world-is-facing-20200416-p54kc3.html

Look at the credibility of the Journalist-Ambrose Evans-Pritchard writing for the Telegraph.
He cites the first release of information from the Danish Antibody study as indicating mortality is over 1% when in fact it indicates it could be 10 times lower(3% of dutch blood donors population have detectable antibodies)

At this moment in time confusion reigns and actions taken by nations to combat corvid -19 have swung from too lax and now too extreme .
The most important thing is to reduce the transmission ratio to less than 1 and then the world has to find a way to keep it at less than 1 .
Its mainly the stupidity of people that prevents this happening in the world
Should be easier for OCA than AIR

[Raz]

...that shouldn’t make you happy ...our hole is pretty deep

Especially when you look at the small group who will be asked to help pay it back via tax....

[Bjauck]

Especially when you look at the small group who will be asked to help pay it back via tax....
Attempts to broaden the tax sources may be needed?
There are so many divergent forcecasts around. The massive QE/Helicopter money will mean governments have to look for tax revenue from somewhere eventually.

How much will Income tax and GST rates increase?
Will the dividend imputation credit scheme be suspended, to encourage NZ companies to reinvest as opposed to paying out such a large percent of profits as dividends?
Will a wealth tax or a CGT be unstoppable now?
Will real estate transfer Stamp duties (such as they have in Australia) be introduced, with second homes and investment properties attracting higher rates?
Will there be an introduction of company share transfer stamp duties and financial transaction duties?

[macduffy]

This thread is rapidly becoming yet another coronavirus fallout thread. Where's OCA these days?

:confused:

[RGR367]

This thread is rapidly becoming yet another coronavirus fallout thread. Where's OCA these days?

:confused:

Yeah, I have to go back to the thread title to make sure I'm on the right thread too.

[Cyclical]

...that shouldn’t make you happy ...our hole is pretty deep

Ok, poor choice of words on my part, I meant it in a relative sense. Circa 20 something % debt/GDP for NZ vs well over 100 for some of the EU nations...I know which one I'd be happier with. I'm under no illusions about the deep hole we're facing.

Anyway, OCA...where to from here? I guess it really depends on when this market is going to catch up with reality. If the market continues to rock along in denial, is it going to get into the 90s in the short term? If the market starts to get a more realistic about what we're facing, is this going to be a relatively "safe stock" and maintain the current levels in the 80s, or are we falling back into the 70s or worse?

At a guess up to 10% reduction in property values in the short term, more or less, some regions impacted more than others (is OCA heavily Auckland based?), and then 2 to 4 years of flat values before we see some upside. Can we see much of a divvy from OCA if this is the case?

[Beagle]

Average expectation of economists is for 6-9% reduction in real estate prices in the year ahead. Taking the mid point of 7.5% has an impact on OCA's portfolio of as at 31 December 2019 $1,496m of $112.2m, 18.25 cps

If we assume average real estate values went up 2.5% in the period from 31 December 2019 to the end of February 2020, before the Covid 19 became a worldwide pandemic, NTA + 2020G - V (the real estate market was very strong in January AND February 2020 so this looks like a reasonable assumption) we get a net forecast adjustment of ~ 5% to real estate prices. This works out to a net adjustment of 12.2 cpsa takes NTA + 2020G-V down to 89 cents per share.
Given the massive uncertainty of how this Covid 19 disease will play out I think the shares are fairly priced at 83 cents.
At this point my assessment is that at 83 cents OCA is trading on about a 6-7% discount to Covid 19 adjusted NTA which seems fair and reasonable.

By comparison I estimate MET's NTA + 2020G - V at $6.16 and at $4 they are trading at a 35% discount to adjusted NTA. MET looks considerably better value to me than OCA. All other companies in this sector look overpriced to me, RYM dramatically so and SUM also heavily overpriced.

[winner69]

Beagle - you thingie COVID adjusted NTA for OCA (and maybe MET) doesn't seem to allow for ongoing losses from the running of the business on a day to day basis (esp care)

[BlackPeter]

Just one random observation I made with OCA (but actually with most of the stocks I am monitoring): Nice bottom around March 22 (give or take a couple of days), strong recovery but then trouble to smash through the MA 50 (the green line in this picture):

11323

Just wondering whether the dead cat bounce is petering out? ... this might be a good time to fasten the seat belts.

[Beagle]

Beagle - you thingie COVID adjusted NTA for OCA (and maybe MET) doesn't seem to allow for ongoing losses from the running of the business on a day to day basis (esp care)

MET has almost no care mate and OCA do okay from their care, (possibly a bit worse than okay with extra security guard and other Covid 19 costs).
Profit for both will be down due to less property settlements but much more comfort from MET's discount to NTA than OCA's.

SUM and ARV considerably overpriced based on NTA-V and RYM are almost as stupidly overpriced as AIR.

Yeah BP, OCA not really the bargain at 83 cents they appear to be. Just fare, fear or fair value, take your pick :) (Okay I really must be bored out of my mind to be playing excessively with puns)

[Cyclical]

...possibly a bit worse than okay with extra security guard and other Covid 19 costs...

Hopefully something coming on that front...

https://www.newsroom.co.nz/covid-19/2020/04/17/1132274/why-rest-homes-will-get-millions-from-taxpayers?amp=1

Announcements about extra funding for the aged care sector would be made “later in the week”, the director-general said. Surely that must mean today.

(Bloomfield said on Tuesday the money would “help offset some of the additional costs they are incurring to both prepare and look after people who may have or who do have COVID-19, for extra security and so on”.)

[macduffy]

SUM and ARV considerably overpriced based on NTA-V and RYM are almost as stupidly overpriced as AIR.


I don't see that as an apples for apples comparison, Beagle. AIR is arguably overpriced because of its precarious future, RYM has been brought down from previous heights because of Covid-19 concerns but has a strong future given demographics and it's pre-eminent position in the industry. Would you care to reconsider or comment?

So far as OCA's shareprice is concerned I reckon it's about right around the mid 80c's in this market. I wouldn't attempt any sophisticated valuation in today's volatile world!

[Beagle]

It was just a throw away line. RYM trading at 2.7 times its pre adjusted Covid 19 NTA makes no sense to me relative to the fact that OCA and MET which are good companies in their own right are trading at discounts to NTA. AIR trading at about NTA when their business model is in complete tatters, (just 1% of previous demand for goodness sake) makes even less sense.

Fact is RYM over the last 5 years have grown at the slowest rate of the industry, (OCA haven't been around for that long so can't compare them to OCA).

[winner69]

Average expectation of economists is for 6-9% reduction in real estate prices in the year ahead. Taking the mid point of 7.5% has an impact on OCA's portfolio of as at 31 December 2019 $1,496m of $112.2m, 18.25 cps

If we assume average real estate values went up 2.5% in the period from 31 December 2019 to the end of February 2020, before the Covid 19 became a worldwide pandemic, NTA + 2020G - V (the real estate market was very strong in January AND February 2020 so this looks like a reasonable assumption) we get a net forecast adjustment of ~ 5% to real estate prices. This works out to a net adjustment of 12.2 cpsa takes NTA + 2020G-V down to 89 cents per share.
Given the massive uncertainty of how this Covid 19 disease will play out I think the shares are fairly priced at 83 cents.
At this point my assessment is that at 83 cents OCA is trading on about a 6-7% discount to Covid 19 adjusted NTA which seems fair and reasonable.

By comparison I estimate MET's NTA + 2020G - V at $6.16 and at $4 they are trading at a 35% discount to adjusted NTA. MET looks considerably better value to me than OCA. All other companies in this sector look overpriced to me, RYM dramatically so and SUM also heavily overpriced.

I’ve warned you in the past about believing those ‘expectations of economists’. Jeez a 7.5% decline in property prices is just the start.

I think you’ll agree the single biggest determinant in terms of driving the property market down is unemployment...yes?

This is no GFC impact ...that only really affected a few ....this virus thing is going to affect everybody. Even you say you’ve never seen anything like it before.

I’d model 15% decline in property prices as a start ....more than 15% likely

What does that do the COVID adjusted NTA for OCA

[Beagle]

64.78 cents. I think a lot of ex pats will come home...that's what I am hearing from the top brass at Bayley's. If we can get on top of this virus here we could see a huge number of ex pat's come back and live here. Who knows exactly what the future holds, certainly not me but I do know there's far better value with MET shares than OCA.

[Food4Thought]

After 2 weeks of ENORMOUS effort to figure out what went wrong between my estimate and actual HY results I've made it to the end of the rainbow. In my defence I always stated my prediction seemed too good to be true but I couldn't see where my workings might be wrong... well now I have.
There where 3 key mistakes/ assumptions I made which may be of interest to others here;
1. The emptying of beds at Lady allum has started ( I thought it was programmed further out). This obviously hurts revenue while maintaining staff costs. This is not a problem per se , just my own anticipated timing of it.
2. Here is the biggie …..I thought ILU new sales would be linear. In fact new ILU sales happen mostly in HY2. I've learned old clients don't venture out in the cold. This explains why the HY2 result is always MUCH stronger. ( I assumed it was always just a delivery, timing thing)So the large Sands and Meadowbank new sales margins ( and large DMFs thereafter)won't really show until the upcoming HY2.
3. On the negative side, “Depreciation” is rapidly rising and will get much greater as they deliver more new stuff. At least this is a non cash expense.

I have spent several weeks on it now and projected out the full pipeline development to completion and FWIW I see care profit declining substantially further for one more year before swinging back upwards as care suits exponentially fill up. These new care suit sales , then DMFs, will increasingly overcompensate for future care beds being decommissioned.


IMO is that OCA’ s reconstruction model is too complex for anyone with a real day job to apply the required focus to fully understand it ( those in meaningful employment can always just take Earls word that things are hunky dory, or otherwise follow the directors lead who are substantially buying up lately). OCAs current overhaul programme is just a beast with many moving parts and with many combinations of deconstruction,revamping, rebuilding methods which all take a lot of separate consideration.
It's not possible to communicate how this complex model works in a chat room using only a few paragraphs at a time, even this post is too long.
One really needs visuals, laser pointers and a break for morning tea to get how this will most likely play out.
For anybody less than “advanced “ in NZ retirement stocks I recommend studying SUM instead. It's much easier to understand buying a paddock and building “monopoly” type units. They are obviously proving an extremely successful model too with lots of history.


So with what ever credibility I have left, my revised prediction for FY20 is underlying 60-61m.
And beyond that it just goes from strength to strength so I'm a very happy long term holder. I wish I had more moola to buy even more in the current opportunity Maccas has just presented us.


Very good post Mav. Is it time yet for some revision?

[Maverick]

Very good post Mav. Is it time yet for some revision?
Hi Foodie, good to see you digging up old posts, obviously you are doing some thinking. Funny you ask for a revised profit , I was doing it just yesterday.


Firstly my overall NZ assumptions (which affect OCA assumptions) are as follows;
-Residential property prices won't fall much and will recover soon enough.
- Retirement villages will not be wiped out or be seen as any less desirable.
-NZ people will go straight back to their old ways, except international travel, when released.
-NZ economy will get through this just fine , except of course international tourism or any business already struggling pre-virus.

So I'm pretty positive about the whole thing, much more than what I`m reading of most others points of view. I`ve been through enough crisis`s and serious broadsides to know everything washes into history and whats always emerges is a better, improved model. Respecting that some will be really suffering, overall I actually see NZ doing “fine and dandy” in a year or two, especially property and equities.( imagine equities with property :t_up:)


My OCA spreadsheet changes are as follows:
-Development will be delayed by only 1 month. I'm expecting construction will recommence at full speed on Thursday.
-Care suites are operating and selling/reselling at normal levels through the lock-down.
-new sales and resales of apartments and villas are down in volume, not prices, for the HY by 25%.
-staffing costs will be up slightly but not much.


Sooooo...what's the magic number?….I was projecting about 60m underlying but am now expecting 55m (9 cps) . That “feels “ too high to me but that's what the spreadsheets pop out.


So at worst I am expecting around last years income of 50m but hoping for 55m and the divi will be maintained.


FWIW, I know MET is very popular here right now , and I've recently run a ruler over it, and do see it at the same excellent buying value as OCA at current share prices. However I still strongly prefer OCA over the LONGER TERM due to its stronger growth pipeline and I really love the care suite model of OCA.

[Bjauck]

64.78 cents. I think a lot of ex pats will come home...that's what I am hearing from the top brass at Bayley's. If we can get on top of this virus here we could see a huge number of ex pat's come back and live here. Who knows exactly what the future holds, certainly not me but I do know there's far better value with MET shares than OCA. Returning expats could add to NZ's forecast unemployment? Would returning ex-pats (especially those from Aussie on special visas) be the wealthier ex-pats who could afford a house deposit? Anyway they could be balanced out by NZ based ex-pats leaving. Especially Asian NZ residents returning to a recovering Asia. NZ has a lot of ex pats from other countries residing here too. NZ's economy may be affected to the same extent as other countries - or possibly worse owing to our a large tourism sector.

The Covid recession may also result in greater protectionism and a less global economy as various countries may decide that building up domestic industries and domestic supply sources may be of benefit in future epidemics or crises. That could be of a disadvantage for NZ's open economy. During covid various measures were introduced to divert for domestic consumption various items that had been destined for export. Many countries will want to take steps to protect against that.

https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12324783

[macduffy]

Appreciate your thoughts, Maverick, and agree with your longer term conclusion that OCA will prove to be a good investment. I don't share your optimism regarding the short term however. I think the real estate market will take rather longer to recover, both in activity and price levels and that economic activity will recover only slowly. I wouldn't hazard a guess as to near term profitability - too many variables - but that goes for just about any listed company these days.

[Raz]

Returning expats could add to NZ's forecast unemployment? Would returning ex-pats (especially those from Aussie on special visas) be the wealthier ex-pats who could afford a house deposit? Anyway they could be balanced out by NZ based ex-pats leaving. Especially Asian NZ residents returning to a recovering Asia. NZ has a lot of ex pats from other countries residing here too. NZ's economy may be affected to the same extent as other countries - or possibly worse owing to our a large tourism sector.

The Covid recession may also result in greater protectionism and a less global economy as various countries may decide that building up domestic industries and domestic supply sources may be of benefit in future epidemics or crises. That could be of a disadvantage for NZ's open economy. During covid various measures were introduced to divert for domestic consumption various items that had been destined for export. Many countries will want to take steps to protect against that.

https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12324783

I do note the main management consulting companies are peddling changes to supply change management which will mean less international trade.

[Curly]

Beagle: getting a bit tired of your pumping of MET on this thread. You are obviously loaded up on MET. Prospects of OCA reaching $1.60 from here far greater than MET reaching $8.20 me thinks?

[Beagle]

Hi Foodie, good to see you digging up old posts, obviously you are doing some thinking. Funny you ask for a revised profit , I was doing it just yesterday.


Firstly my overall NZ assumptions (which affect OCA assumptions) are as follows;
-Residential property prices won't fall much and will recover soon enough.
- Retirement villages will not be wiped out or be seen as any less desirable.
-NZ people will go straight back to their old ways, except international travel, when released.
-NZ economy will get through this just fine , except of course international tourism or any business already struggling pre-virus.

So I'm pretty positive about the whole thing, much more than what I`m reading of most others points of view. I`ve been through enough crisis`s and serious broadsides to know everything washes into history and whats always emerges is a better, improved model. Respecting that some will be really suffering, overall I actually see NZ doing “fine and dandy” in a year or two, especially property and equities.( imagine equities with property :t_up:)


My OCA spreadsheet changes are as follows:
-Development will be delayed by only 1 month. I'm expecting construction will recommence at full speed on Thursday.
-Care suites are operating and selling/reselling at normal levels through the lock-down.
-new sales and resales of apartments and villas are down in volume, not prices, for the HY by 25%.
-staffing costs will be up slightly but not much.


Sooooo...what's the magic number?….I was projecting about 60m underlying but am now expecting 55m (9 cps) . That “feels “ too high to me but that's what the spreadsheets pop out.


So at worst I am expecting around last years income of 50m but hoping for 55m and the divi will be maintained.


FWIW, I know MET is very popular here right now , and I've recently run a ruler over it, and do see it at the same excellent buying value as OCA at current share prices. However I still strongly prefer OCA over the LONGER TERM due to its stronger growth pipeline and I really love the care suite model of OCA.

Hi Mav me ol mate. Hope you're doing well and that your sanguine view of the effect on the economy is bang on the money. Nobody wants to see deep economic carnage as nobody is a winner from that but I consider some pretty grim economic outcomes are quite likely and we're highly likely to see a material effect on the real estate market. I think a 5-10% reduction in the next 12 months is highly likely. That said provided there's an effective treatment or vaccine we should see a strong rebound starting hopefully sometime next year so I am doing my best to look through this and invest based on FY22 prospects and beyond.
OCA look fair value to me in the 80's, all things considered.

Curly, such a brash opinion from someone who has contributed just 12 posts. People will always compare retirement companies on retirement company threads, its a helpful process and healthy debate that's been going on since Adam was a boy. If you actually made some sound analytical argument to support your opinion I might be more interested in it.

[Curly]

Beagle:
Such a trite response. Gotcha