ARV - Arvida Retirement Villages

[Joshuatree]

So on to it TJ hats off

13/7/15
I have said this for a while, but people are blinded by SUM (and others) and how great the resales etc are... yet ARV is actually much more attractive from a traditional point of view (Forward PE ratio, dividend yield)... ARV are a "new" company, and despite management delivering very good outcomes so far (eg successful village integration and acquisition of a couple of very very high quality villages, as original hinted to in the prospectus and various market updates), people are already writing it off, such as the assumption that they will always be stuck in what is apparently a seemingly extremely low-margin and outdated care based portfolio (even though this is only part of their business)

I would even be tempted to say the ARV will be the best performing retirement stocks on the NZX over the coming year.

[peat]

Given the revaluations on their books are ensuring NTA is close to market value of the assets ARV is the 2nd best based on buying cheapest assets . But yes being smaller means more growth potential.

Price:NTA

MET 1st @ 1:1

ARV 2nd 1.25:1

SUM 3rd 3(ish):1

RYM 4th 4:1

[trader_jackson]

$1.29... Haven't even got half way through day 1 (on the NZX) of 2017 and ARV is already at an all time high... not to many sellers around, while buyers are desperate to get in (buyers to sellers currently at 10:1)

While the 're-rating' is a year overdue, it is good to see it occur.

It is fair to say, ARV is off to a great start :t_up:. No doubt 2017 will be an interesting year for ARV.

winner69, if this keeps up, ARV could jump in front of HBL in the race to see who gets to $2 first: HBL or ARV

[winner69]

$1.29... Haven't even got half way through day 1 (on the NZX) of 2017 and ARV is already at an all time high... not to many sellers around, while buyers are desperate to get in (buyers to sellers currently at 10:1)

While the 're-rating' is a year overdue, it is good to see it occur.

It is fair to say, ARV is off to a great start :t_up:. No doubt 2017 will be an interesting year for ARV.

winner69, if this keeps up, ARV could jump in front of HBL in the race to see who gets to $2 first: HBL or ARV

No t_J - let's make it $1.60

Heartland struggling to get there

[kizame]

No t_J - let's make it $1.60

Heartland struggling to get there

HBL got there. What you had been saying all along and it made it, now look at the consolidation pattern on the daily and weekly chart,I think there is more to come,and as I have said before I think 1.80 is next target price.

[kizame]

HBL got there. What you had been saying all along and it made it, now look at the consolidation pattern on the daily and weekly chart,I think there is more to come,and as I have said before I think 1.80 is next target price.

Ooops wrong thread sorry,but sort of appropriate maybe.

[winner69]

t_j jeez 135 and only 17 cents behind HBL

I reckon ARV will beat HBL to 160

Great start to new year for you eh - well done

[trader_jackson]

t_j jeez 135 and only 17 cents behind HBL

I reckon ARV will beat HBL to 160

Great start to new year for you eh - well done

It has done well hasn't it? Heartland should watch out...

Good volumes as well...SUM investors might be on holiday, but others are snapping up ARV shares while they are still cheap(ish?) I suppose ;)

Woudln't be surprising if some were selling down the 'big 3' (although ARV is fast catching up) and repositioning their portfolios...

Market cap over $450m now... who would have thought this "dog" ARV would be (nearly) half the size of, say, SUM, just 2 years after it's IPO

Well done to all the holders.

[trader_jackson]

t_j jeez 135 and only 17 cents behind HBL

I reckon ARV will beat HBL to 160

Great start to new year for you eh - well done

Just noticed the NZX website is showing over 59% return for 52 weeks, fantastic stuff really.

Looking forward to some strong full year results.

[Glendoonie]

Just noticed the NZX website is showing over 59% return for 52 weeks, fantastic stuff really.

Looking forward to some strong full year results.

As am I. Bought yesterday at 134

[Snow Leopard]

Seems to have had a little run whilst I have been away and 1 of only 2 NZX stocks (the other is THL) the infallible Tiger Stock Picking Software is currently keen on.


Best Wishes
Paper Tiger

[kiora]

Seems to have had a little run whilst I have been away and 1 of only 2 NZX stocks (the other is THL) the infallible Tiger Stock Picking Software is currently keen on.


Best Wishes
Paper Tiger

Let me know when you're going back on holiday PT for buying back in :)

[kiora]

Can anyone explain why such a low margin of safety between eps of 12.9cents and a PE ratio of 10.1 ??

http://www.4-traders.com/ARVIDA-GROUP-LTD-20708484/financials/
They issued more shares to purchase 3 existing villages this yr hence rising EBIT & PE

[Mitch]

Can anyone shed some light onto why there is such a small margin of safety between EPS (12.9cents) and PE ratio (10.1)?

[glennj]

Can anyone shed some light onto why there is such a small margin of safety between EPS (12.9cents) and PE ratio (10.1)?

I'm not sure what you are getting at here Mitch? Perhaps you are mistaking PE with dividend payout?

[winner69]

Can anyone shed some light onto why there is such a small margin of safety between EPS (12.9cents) and PE ratio (10.1)?

Multiply the 12.9 (the eps) by the 10.1 (pe) you get the share price of 130

That answers your question - think about it

[glennj]

Multiply the 12.9 (the eps) by the 10.1 (pe) you get the share price of 130

That answers your question - think about it

That is basic and it doesn't really address the "such a small margin of safety" comment.
Maybe Mitch will clarify what he meant?

[winner69]

That is basic and it doesn't really address the "such a small margin of safety" comment.
Maybe Mitch will clarify what he meant?

I think mitch has misunderstood percy's lessons and need to grasp what a PE ratio really is

Suggesting he thinks about what I posted was an attempt to help him out

[stevevai1983]

some quick questions:
1: Why ARV is able to distribute such high cash dividend while other retirement companies can't?(even you reduce RYM/SUM to the same valuation) Is it because ARV's bed % is higher?

2: According to the latest presentation, ARV's portfolio is quite big already after some acquisitions. The total units/beds is about the same as SUM. However SUM has a significant higher build rate. Does that mean SUM will have higher growth rate. In this case, SUM deserves higher valuation. (so we can't expect ARV's valuation to increase to RYM/SUM's level)

[King1212]

Third quater dividend and update are due soon...maybe tomorrow or early next week....come to poppa ..juicy dividend....:t_up:Arvida is a keeper....

[trader_jackson]

some quick questions:
1: Why ARV is able to distribute such high cash dividend while other retirement companies can't?(even you reduce RYM/SUM to the same valuation) Is it because ARV's bed % is higher?

2: According to the latest presentation, ARV's portfolio is quite big already after some acquisitions. The total units/beds is about the same as SUM. However SUM has a significant higher build rate. Does that mean SUM will have higher growth rate. In this case, SUM deserves higher valuation. (so we can't expect ARV's valuation to increase to RYM/SUM's level)

1. ARV does have fairly good cash flows, but I believe the reason they distribute more is because they have a lower re-investment rate, as a result of a lower build rate, and therefore ARV is lower risk.

2. ARV portfolio is quite big... it wasn't always this great, it was often compared to a dog on this very thread. ARV does have a lower build rate, and therefore one would expect a lower growth than a company that would have a much higher build rate like SUM - and I'd like to therefore think they have a much higher growth rate - they are borrowing significant SUMs of money (the most leveraged listed retirement company I think?) to do it for starters, and paying peanuts, not a dividend.
Also remember ARV also hasn't begun its 3rd stage, as outlined in it's IPO booklet late 2014 when it listed at 95 cents: greenfield development - for now it is gathering expertise, increasing geographic presence, and when the time is right, proceed to greenfield development - this is where growth rates (already pretty solid) will increase for ARV... the re-rating, based purely on brownfield development pipeline, has already begun (as shown by ARV being the best performing retirement stock - by far - in 2016), with the stock going from stupidly cheap, to being priced more appropriately.

As always, this is just my view, and DYOR.

I'm looking forward to some sort of third quarter update, alongside a 1.1 cent dividend... next quarter will be another nice lift in the dividend no doubt... would also be great if they had a DRP, they are hopefully looking into it.:t_up:

[stevevai1983]

very informative :t_up: i will read the IPO booklet tmr

[trader_jackson]

very informative :t_up: i will read the IPO booklet tmr

Yup, in: Investment Statement Initial Public Offering of Ordinary Shares in Arvida Group Limited (dated 17 November 2014)
page 14, section 3.5: Opportunities for Growth
1 Brownfield Development... (various bullet points)
2 Acquisitions... (various bullet points)
3 Greenfield Development:
- In-house greenfield development capabilities to be developed
- Greenfield development pipeline to be established over time

[JoeGrogan]

Dividend announced today, seems to be holding steady around the mid 1.30's. Eagerly awaiting the investor update next month

https://www.nzx.com/companies/ARV/announcements/297481

[trader_jackson]

Forsyth lifts target price dramatically, from NZ$1.42 to NZ$1.57 :t_up:, over 16% higher than today's closing (over 20% target return in the next year when you consider the dividend :) - although not quite as high as the 57% ish 52 week return mentioned on NZX's website today)

Key points:
- Stepping up the build rate to around 120 units per annum
- No greenfield development sites yet: "expect that ARV is looking to add such a site to its land bank given its pick up in brownfield expertise" - I've been saying this for a while now
- FY18 is a key year: "first year of large scale new stock delivery... first chance to demonstrate it can build quickly, sell down quickly and recycle capital."
- This may come as a surprise to some, but according to Forsyth Analysis ((metrics re-weighted to reflect ARV's balance date - March) FY 17 and FY 18 estimate PE for SUM is a bit higher than ARV, while MET is a bit lower, and RYM is quite a bit higher. And I don't even need to talk about how much higher the dividend is ;)

OUTPERFORM rating, while SUM and MET have Neutral ratings: ARV has an interesting combination of defensive qualities + low exposure to the Auckland housing market + growth opportunities associated with brownfield expansion of established villages + ultimately greenfield expansion

I am looking forward to some sort of update between now and May (being results month)

[King1212]

https://www.nbr.co.nz/article/government-has-room-pre-election-sweetener-health-infometrics-says-b-200718


Mr Kiernan said the ageing population would lead to increased demand for aged care and residential home services and, while technological advances and automation may limit the additional number of extra workers needed, those gains are still likely to run ahead of the national average.

[King1212]

just received an update via email, investor news..everything is well on track and heaps of developments....

[trader_jackson]

just received an update via email, investor news..everything is well on track and heaps of developments....

Yeah, very happy with the dividend coming through today. The section on "Arvida’s growth isn’t only occurring through acquisition. Where else is it coming from?" was of particular interest... highlighting organic growth.

Can't seem to find the investor update we were emailed on the nzx? (the March investor news update number 4) unless I am missing something?
(would be great to share with you all ;))

[artemis]

Arvida is not included in the white paper from JLL New Zealand Retirement Village Database, though is to be included from the next report.

See the Herald article Risks in rampant retirement village growth


Some interesting stats on the sector.

Risks said to be -

• An oversupply in the Auckland region, in the short to medium term

• The holding costs of land banking and miscalculations in location and capital investment decisions

• Negative publicity regarding the ORA (occupation right agreement, also called the deferred management fee).

• Risks from the general housing market affecting potential village residents' equity holdings.

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11823962

[trader_jackson]

Arvida is not included in the white paper from JLL New Zealand Retirement Village Database, though is to be included from the next report.

See the Herald article Risks in rampant retirement village growth


Some interesting stats on the sector.

Risks said to be -

• An oversupply in the Auckland region, in the short to medium term

• The holding costs of land banking and miscalculations in location and capital investment decisions

• Negative publicity regarding the ORA (occupation right agreement, also called the deferred management fee).

• Risks from the general housing market affecting potential village residents' equity holdings.

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11823962

ARV is probably the least effected listed operator right now due to their (current) focus on brownfield development, their 'needs based' portfolio, and a portfolio which isn't very exposed to Auckland like SUM others ;). What I think could be a risk (although small) is rising interest rates and how this may negatively effect SUM of those villages with high debt... which is not ARV (who has one of the lowest gearing ratios).

Ironically, on the same day, there was an article which was totally opposite to the doom and gloom above:
http://www.stuff.co.nz/business/90762761/Retirement-village-investment-in-its-infancy-but-demands-set-to-grow

[winner69]

ARV is probably the least effected listed operator right now due to their (current) focus on brownfield development, their 'needs based' portfolio, and a portfolio which isn't very exposed to Auckland like SUM others ;). What I think could be a risk (although small) is rising interest rates and how this may negatively effect SUM of those villages with high debt... which is not ARV (who has one of the lowest gearing ratios).

Ironically, on the same day, there was an article which was totally opposite to the doom and gloom above:
http://www.stuff.co.nz/business/90762761/Retirement-village-investment-in-its-infancy-but-demands-set-to-grow

When's the takeover going to happen t_j

[whatsup]

Hi all,

Pretty new around here, but can someone explain why someone would place a BUY order for 1.480 when there is SELL orders for 1.200?

See attached.

8819

What time was that reading, could be the end of day settlement @ 4.55pm when no trades take place for a few minutes then all are cleared at that price crossing on closing.

[777]

Happens with all stocks during hour before opening and the last 15 minutes of the trading day. Have a look in newbies to see threads that have covered this in detail. All completely normal all bourses.

Look at Aussie market at 6pm NZ time for the same actions.

[Elles]

It might just be the preclose where people put in orders knowing it will go for the match price anyway (129 today). Someone else may be able to explain it better, but it's not unusual at the start and end of the trading day.

As per previous posts - hadn't spotted those before replying...

[King1212]

Result in 2 weeks...last forecast was expecting strong result and on track...good luck guys..better off Arvida than Oceania..I reconk.....

[King1212]

Have any posters visited ARV's villages?
Would anyone be prepared to live at Park Lane on Whiteleigh Ave?

my tenant works at one of the site, bay of plenty....she loves it!! Heap of development in progress. Staffs are happy..that is the main thing...happy staffs happy company...

She said it is a good company to work for. she has worked there for years....

[percy]

my tenant works at one of the site, bay of plenty....she loves it!! Heap of development in progress. Staffs are happy..that is the main thing...happy staffs happy company...

She said it is a good company to work for. she has worked there for years....

Looking through their site I see they have a few nice villages,but also some that are not.
A lot seem to be very small,ie Maples and Rhodes on Cashmere.
The Park Lane one is on a busy road,next to AMI Stadium.
Would be so noisy you would never be able to open a window, or sit outside,and that would also be very stressful.[the noise]
I have visited all RYM and SUM villages in the South Island,and know a few in the North Island.
They have scale,which appears to be lacking with ARV.

[trader_jackson]

I believe results are tomorrow and I will be looking out for a few things (in order of importance):
- EPS growth of about 12%
- FY18 Brownfield development
- Comment (if any) on greenfield opportunities
- Comment (if any) on other acquisitions
- Comments on Government review of caregiver wages and how this affects them (and the recent increase in funding of 1.8% ARV was given by the government to help with pay rises - I think)
- Dividend uplift continuing and/or dividend reinvestment programme and/or dividend payout changes (ie reduction) to help further fund growth (although as conservatively geared could just borrow more)

[King1212]

Broker target is $1.52...

[winner69]

Broker target is $1.52...

In a years time?

[King1212]

In a years time?

Maybe...maybe not...look at ATM, brokers said $2.80 ish....soo sold around that price..now different story.....

[Crow]

24th May not tomorrow.
https://nzx.com/companies/ARV/announcements/300934

[trader_jackson]

24th May not tomorrow.
https://nzx.com/companies/ARV/announcements/300934

I actually thought the same initially! Forsyth, the ones who took them public at 0.95c a share (and who currently have a $1.57 rating on it), must have made a typo in their latest report... (which says 22 May - and for some silly reason I didn't check the company's actual announcement made a week before Forsyth brought out its report/update)
Well still a few more days I suppose for investors to take positions on the result.
Wednesday will be ultra busy, Arvida (the 'big' one), AFT and Pacific Edge... all stocks I hold :t_up:

[Crow]

Good luck then to us all😊

[Crow]

Results 😂

https://nzx.com/companies/ARV/announcements/301592

[couta1]

Where are you Trader Jackson, thought you'd be trumpeting from the roof tops by now.:cool:

[trader_jackson]

27% increase in underlying EPS ???? are you kidding me!?
This is more 2x better than forsyth were expecting!
Winner69, might give heartland a run at the $2 spot now?

Arvida, the dog that nobody wanted growing nearly 2x faster than the top dog Ryman.

[winner69]

Solid result ...in line with overall sector performance

Underlying profit if $23m is underlying eps of 7.7 cents (weighted average) or 7 cents on actual current numbers

So valued at the moment about the same as SUM ...with similar growth rates

[Crow]

Lol
Let's see how the day goes 😈

[winner69]

Where are you Trader Jackson, thought you'd be trumpeting from the roof tops by now.:cool:

Too busy doing the numbers on PEB

[trader_jackson]

Solid result ...in line with overall sector performance

Underlying profit if $23m is underlying eps of 7.7 cents (weighted average) or 7 cents on actual current numbers

So valued at the moment about the same as SUM ...with similar growth rates

Yes, except much higher dividend, and much more conservatively geared... oh and we haven't started talking about greenfield development (which is about the only reason SUM is growing so strongly)

... until now that is: (as I predicted about 2 years ago)

"Greenfield Acquisition On 23 May 2017, a conditional agreement was entered to acquire 8.2 hectares of bare land in Richmond, Nelson. The acquisition at $11 million is subject to completion of re-zoning and subdivision as it forms part of a larger residential subdivision to be developed. The site provides for a $100 million retirement village and integrated care development."

[trader_jackson]

Lol
Let's see how the day goes 

You'd think the other dog OCA might benefit as well from ARV's result?
... but probably not

[LAC]

Wow, just read the results.....going to be an interesting day. Had to read the EPS growth twice to make sure it wasnt 2.7%

[winner69]

Wow, just read the results.....going to be an interesting day. Had to read the EPS growth twice to make sure it wasnt 2.7%

Underlying profit +47%

With all new shares underlying eps of 7.7 cents +27% no weighted average basis

As a starting point for valuations on year end actual shares eps is 7.0 cents a share

[King1212]

The shares are selling like hot cakes! Go hard guys!

[dabsman]

Still no news on a DRP?

[winner69]

How things have changed - SUM is now the undervalued not wanted DOG of the retirement sector eh t_j

Well done Arvida

[Crow]

Now it's interesting. ....will it break the 52 week high 😲

[King1212]

Still no news on a DRP?

the dividend mate...otherwise happy to give you my bank ac:t_up:

[dabsman]

All my dividends go back into the market so makes little difference apart from not having to pay a broker fee and a little shading on the price. Will keep waiting...

[King1212]

well..i guess $1.52 is under the way TJ!!! How is AFT and PEB???

[trader_jackson]

Still no news on a DRP?

I was hoping for some news on this... as I am sure it would be very well received. Might be a question to ask in CHCH when the annual meeting comes up soon(ish)... anyone going?

Good to see the re-rating continuing today, with ARV trading on good volume, at all time highs

[trader_jackson]

well..i guess $1.52 is under the way TJ!!! How is AFT and PEB???

Yes quite possibly, unfortunately AFT and PEB aren't doing so well... unlike ARV they just 'met' estimates... ARV smashed it out of the park

[King1212]

Well, keep holding...if u believe in them!

[Beagle]

How things have changed - SUM is now the undervalued not wanted DOG of the retirement sector eh t_j

Well done Arvida

SUM shares "only" grew underlying profit 50% last year and 55% the year before that. Apparently not good enough but 47% is wonderful, go figure...

[trader_jackson]

SUM shares "only" grew underlying profit 50% last year and 55% the year before that. Apparently not good enough but 47% is wonderful, go figure...

Wonderful it is... given the much lower risk (dramatically lower borrowing, and less exposure to development risk etc), and the "cash reward along the way" being dividends (not peanuts ;))

I am sure SUM day SUM shares will begin going back up again - maybe when they have a better continuum of care and facing less risk of construction costs running away, among other factors - sometimes being smaller and more nimble isn't a bad thing.

[sb9]

Good result overall from a relatively new small player, well done to all those holders.

[percy]

Good result overall from a relatively new small player, well done to all those holders.

Agree.
Nice to be proved wrong.....again.

[trader_jackson]

Good result overall from a relatively new small player, well done to all those holders.

hmmm...
Imagine how undervalued OCA would be if it managed to deliver even remotely close to ARV?:ohmy:
Imagine, like ARV, if it managed to beat IPO forecasts?
If that was the case, the retirement stock I would be buying today on the NZX would not be SUM, RYM MET or even ARV ;)

[winner69]

Wonderful it is... given the much lower risk (dramatically lower borrowing, and less exposure to development risk etc), and the "cash reward along the way" being dividends (not peanuts ;))

I am sure SUM day SUM shares will begin going back up again - maybe when they have a better continuum of care and facing less risk of construction costs running away, among other factors - sometimes being smaller and more nimble isn't a bad thing.

But as ARV start new developments in earnest won't they be increasing the above mentioned 'risks'

Debt increased from 3% to 16% of equity plus debt in F16 - expect more leverage in future years.

[Snow Leopard]

I am sure I still have these in a portfolio somewhere, probably under the heap of straw camels I brought back as pressies for the forum.

So I am reasonably happy with the result. [Think Tiger Bop]

Best Wishes
Paper Tiger

Hum, now who did I buy this packet of Figs for?

[trader_jackson]

But as ARV start new developments in earnest won't they be increasing the above mentioned 'risks'

Debt increased from 3% to 16% of equity plus debt in F16 - expect more leverage in future years.

Yes, they will be, however an extremly strong care position (with their predictable and safe cash flows) will still be present... (did I mention how healthy operating cash flows are?)

and very true, still a while to go to 37% or so, like SUM others

[percy]

hmmm...
Imagine how undervalued OCA would be if it managed to deliver even remotely close to ARV?:ohmy:
Imagine, like ARV, if it managed to beat IPO forecasts?
If that was the case, the retirement stock I would be buying today on the NZX would not be SUM, RYM MET or even ARV ;)
Oh dear.!! I think I will have to admit, I recycled some EVO money into OCA today,for the very reason you have given.!!

[King1212]

hmmm...
Imagine how undervalued OCA would be if it managed to deliver even remotely close to ARV?:ohmy:
Imagine, like ARV, if it managed to beat IPO forecasts?
If that was the case, the retirement stock I would be buying today on the NZX would not be SUM, RYM MET or even ARV ;)

yes, if it managed to beat IPO forecast....time will tell. Many companies fail to achieve...such as TGH, EVO....people was doubting Arvida..remenber....it takes time to achieve the forecast...but can people wait?

[janner]

Oh dear.!! I think I will have to admit, I recycled some EVO money into OCA today,for the very reason you have given.!!


Only SUM !!!..

[trader_jackson]

yes, if it managed to beat IPO forecast....time will tell. Many companies fail to achieve...such as TGH, EVO....people was doubting Arvida..remenber....it takes time to achieve the forecast...but can people wait?

Time will tell... what I do know for sure, is that OCA, or any shares (assuming solvency and listing), will only go up, down or stay the same ;)

[percy]

Time will tell... what I do know for sure, is that OCA, or any shares (assuming solvency and listing), will only go up, down or stay the same ;)

Bit of an exact science with me,they go up when I sell,down when I buy, and stay the same when I hold....lol.

[janner]

Bit of an exact science with me,they go up when I sell,down when I buy, and stay the same when I hold....lol.

Exact ??? Maybe we should work together on this :-)))

[sb9]

Looks like some big players come out in full swing to offload their stakes and spoil the party......big parcels on offer at 137 and 138...

[Roadrunner]

I`ve been involved with ARV since before Christmas and have to say I don`t think they have put a foot wrong thus far.The financial results they have delivered have demonstrated not only how quickly they are growing but how prudent management have been in the decisions they have made.They seem very growth focused but also, as they described in their teleconference, any potential acquisitions etc, go through their own filter and only those that 'cut the mustard' are followed up.The potential greenfield development in Richmond,Nelson sounds like the first of many in the years to come.There seems to have been a fair bit of cap and accumulating with the shares by the big kahunas since announcement but that won`t last forever and I expect the SP to move forward strongly in the days and weeks ahead.....just my opinion though,do your own research!

[King1212]

I`ve been involved with ARV since before Christmas and have to say I don`t think they have put a foot wrong thus far.The financial results they have delivered have demonstrated not only how quickly they are growing but how prudent management have been in the decisions they have made.They seem very growth focused but also, as they described in their teleconference, any potential acquisitions etc, go through their own filter and only those that 'cut the mustard' are followed up.The potential greenfield development in Richmond,Nelson sounds like the first of many in the years to come.There seems to have been a fair bit of cap and accumulating with the shares by the big kahunas since announcement but that won`t last forever and I expect the SP to move forward strongly in the days and weeks ahead.....just my opinion though,do your own research!

$1.52...next target...until the next result..the sp target will be different again...good luck all the holders!

[trader_jackson]

I`ve been involved with ARV since before Christmas and have to say I don`t think they have put a foot wrong thus far.The financial results they have delivered have demonstrated not only how quickly they are growing but how prudent management have been in the decisions they have made.They seem very growth focused but also, as they described in their teleconference, any potential acquisitions etc, go through their own filter and only those that 'cut the mustard' are followed up.The potential greenfield development in Richmond,Nelson sounds like the first of many in the years to come.There seems to have been a fair bit of cap and accumulating with the shares by the big kahunas since announcement but that won`t last forever and I expect the SP to move forward strongly in the days and weeks ahead.....just my opinion though,do your own research!

Thank you for your post - are you involved with ARV shareholder wise or more directly (ie supplier etc).

On another note, could see $1.38 again today... seems like the market is only to happy to snap up ARV shares (quite a change to just a few years ago)... as it has been mentioned on here, some brokers saying it has well over 10% more room to run in less than a year (excluding the attractive dividend) :t_up:

[000831]

I hope that I did it correctly. It is a great company with innovated business model in the industry. 8877

[winner69]

Good stuff 000831

Must be a error somewhere - you have ARV on a higher PE multiple than SUM - that's not possible

[000831]

for the PE part, I just simply copy from ASB system.

[000831]

88788879

The trend seems very simply. The price increases with the support of increasing EPS. We do not know who is selling between 1.37 and 1.38. But if it gains the 5 million buying power again, then we could see the next stage would be around $1.65 +- 10% range.

I hope that Milford, ANZ or other fund managers could consider this share to buy in. It could be the super star as RYM or FPH.

Happy trading!

[Roadrunner]

Thank you for your post - are you involved with ARV shareholder wise or more directly (ie supplier etc).

On another note, could see $1.38 again today... seems like the market is only to happy to snap up ARV shares (quite a change to just a few years ago)... as it has been mentioned on here, some brokers saying it has well over 10% more room to run in less than a year (excluding the attractive dividend) :t_up:

Hi,yes as a shareholder and looking to be a long time holder with the option of taking other shorter-term opportunities as they come along share-wise.Over the past 5/6 years I`ve held the likes of DIL,XRO,ATM and PEB to name a few :)

[percy]

Received a bright mailer today from Arvida.
They are giving "Living Well" presentations, at three of their local villages.
Prices for their Mayfair village at 104 Wharenui Road,Riccaron, are Independant Villas from $399,000, and Serviced Studio Apartments from $215,000.From the photo the villas look very nice.

[JeremyALD]

Are you invested in ARV Percy? I'm considering get in with a small share given the SP weakness presently

[percy]

Are you invested in ARV Percy? I'm considering get in with a small share given the SP weakness presently

No,as I hold OCA,RYM and SUM.which means I have the sector well covered..
However, the wife and I will start looking at retirement villages next year.We have been thinking of downsizing,but it may make better sense moving into a retirement village.
So the mailer took my eye.

[King1212]

Heavy volume lately on OCA....people is taking it as a new horse in this sector

[trader_jackson]

Received a bright mailer today from Arvida.
They are giving "Living Well" presentations, at three of their local villages.
Prices for their Mayfair village at 104 Wharenui Road,Riccaron, are Independant Villas from $399,000, and Serviced Studio Apartments from $215,000.From the photo the villas look very nice.

Thanks for sharing percy, a few weeks back I saw a double page colourful flyer in NZ Herald, usually MET or SUM like to put their ones in, but today was ARV's day... I was pleasantly surprised... I know MET and SUM like to show off their run-of-the-mill product, but ARV advertising their new Aria Bay development in Browns Bay, Auckland was a nice twist. No mention of price, but I know they are a premium product... I suppose if you have to ask the price, you probably can't afford it ;).

Bit of share price weakness very recently, I believe tomorrow is the AGM so could be because of this, or could be due to some switching out to the comparable OCA, probably while it is still trading so cheap, not just compared to ARV, but any other listed company. Results for OCA not far away.

[King1212]

Thanks for sharing percy, a few weeks back I saw a double page colourful flyer in NZ Herald, usually MET or SUM like to put their ones in, but today was ARV's day... I was pleasantly surprised... I know MET and SUM like to show off their run-of-the-mill product, but ARV advertising their new Aria Bay development in Browns Bay, Auckland was a nice twist. No mention of price, but I know they are a premium product... I suppose if you have to ask the price, you probably can't afford it ;).

Bit of share price weakness very recently, I believe tomorrow is the AGM so could be because of this, or could be due to some switching out to the comparable OCA, probably while it is still trading so cheap, not just compared to ARV, but any other listed company. Results for OCA not far away.

yes If u look at OCA of 50more facilities then compare it with ARV with half of the facilities then we got OCA around $500ish m cap market VS ARv around $400ish m cap market....

i think people is thinking OCA is far too cheap?

Bloody OCA...otherwise ARV will be the man now in the sector....

[winner69]

Salt are short Arvida according to their latest update.

Just saying

[trader_jackson]

Salt are short Arvida according to their latest update.

Just saying

Out of the 4* retirement stocks, doesn't Salt have just the tinniest of tiny short in Arvida?
Funny because some say ARV (aka "the dog") is the most overvalued of the lot right now...
Even funnier (and on a slightly different topic) AFR in Australia drew a compression a few months back between OCA amd SUM... yet OCA is way way cheaper.

At the end of the day holders such as myself will enjoy the nice dividend (not peanuts) ARV pays (and likely OCA will pay)... so no worries.

*(we can't count OCA yet, just like ARV wasn't, and, well, still isn't classified by some people as one of the listed retirement stocks)

[trader_jackson]

Crazy to think ARV went down to $1.25, shows what a bit of panic can do (caused by ???). Back comfortably into the 1.30's now ($1.33 today)

Seems the 'smart money'* has been taking advantage of the unnecessary price weakness...
https://www.nzx.com/companies/ARV/announcements/303888

No worries. $1.33 isn't that far off the all time high I suppose... in fact some might even be surprised how we are still in the $1.30's given the likely EPS accretive acquisitions, development pipeline, and unique (niche in some ways) approach of ARV's villages

*Some may not consider Forsyth Barr smart

[Roadrunner]

Crazy to think ARV went down to $1.25, shows what a bit of panic can do (caused by ???). Back comfortably into the 1.30's now ($1.33 today)

Seems the 'smart money'* has been taking advantage of the unnecessary price weakness...
https://www.nzx.com/companies/ARV/announcements/303888

No worries. $1.33 isn't that far off the all time high I suppose... in fact some might even be surprised how we are still in the $1.30's given the likely EPS accretive acquisitions, development pipeline, and unique (niche in some ways) approach of ARV's villages

*Some may not consider Forsyth Barr smart

Yes tj I was surprised by the weakness that took them back down but it was short-lived and a good flush out if nothing else!!Often wonder about the origins of some of the doom and gloom media reports and how often scaremongering is often created by the same people who are filling their boots on the back of the panic they created themselves.Arvida have basically been unrewarded for a stellar set of results but the tide seems to be turning after what would have been a very positive Annual Meeting.Did anyone out there go?

[King1212]

Bloody missed that $1.25...put an order on at 1.27 but cancelled as saw the depth was really scary....no buyers..though boom n gloom really happened on retirement sector...

[Roadrunner]

Bloody missed that $1.25...put an order on at 1.27 but cancelled as saw the depth was really scary....no buyers..though boom n gloom really happened on retirement sector...

Yeah I would have been keen to get a few more at those prices too but I`m all in on ARV so no more cash to spare alas!

[Entrep]

Yeah I would have been keen to get a few more at those prices too but I`m all in on ARV so no more cash to spare alas!

Your wish may come true...

[Roadrunner]

Your wish may come true...

Haha!....yes that`s true

[MrMarkT]

https://www.stuff.co.nz/life-style/homed/latest/94834797/changing-face-of-retirement-villages-is-all-about-catering-to-new-demographic

[trader_jackson]

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11898293

You might say it is sad stuff for old Bill, CEO of a $400m company with a great track record (both earnings and share price performance wise) and gets paid peanuts compared to say the NZX who was paid $2.5m more, yet has a market cap about a third lower than Arvida. Maybe Bill is just so happy to work for such a great company he isn't in it for the money? Must be good for culture... I've always heard Arvida has great culture.

[dabsman]

I'm looking to double my holding - where are all these chartists to tell me when?

[kiora]

From KW
https://www.sharetrader.co.nz/showthread.php?9176-Using-TA-to-time-entries-and-exits
https://finance.yahoo.com/chart/ARV.NZ#eyJzaG93QXJlYSI6ZmFsc2UsInNob3dMaW5lIjpmYWx zZSwibXVsdGlDb2xvckxpbmUiOmZhbHNlLCJzaG93Q2FuZGxlI jp0cnVlLCJib2xsaW5nZXJVcHBlckNvbG9yIjoiI2UyMDA4MSI sImJvbGxpbmdlckxvd2VyQ29sb3IiOiIjOTU1MmZmIiwic2hvd 1NtYSI6dHJ1ZSwic21hQ29sb3JzIjoiIzFhYzU2NywjZjAxMjZ mLCMxYWM1NjciLCJzbWFQZXJpb2RzIjoiNTAsMjAwLDUwIiwic 21hV2lkdGhzIjoiNCw0LDEiLCJzbWFHaG9zdGluZyI6IjEsMCw wIiwic2hvd01maSI6dHJ1ZSwibWZpTGluZUNvbG9yIjoiIzQ1Z TNmZiIsIm1maUxpbmVXaWR0aCI6IjIiLCJzaG93TWFjZCI6dHJ 1ZSwibWFjZERpdmVyZ2VuY2VDb2xvciI6IiNmZjdiMTIiLCJtY WNkTWFjZENvbG9yIjoiIzc4N2Q4MiIsIm1hY2RTaWduYWxDb2x vciI6IiMwMDAwMDAiLCJtYWNkTWFjZFdpZHRoIjoiMiIsIm1hY 2RTaWduYWxXaWR0aCI6IjQiLCJzaG93UnNpIjp0cnVlLCJyc2l MaW5lQ29sb3IiOiIjZmZiNzAwIiwic3RvY2hLTGluZUNvbG9yI joiI2ZmYjcwMCIsInN0b2NoRExpbmVDb2xvciI6IiM0NWUzZmY iLCJsaW5lVHlwZSI6ImNhbmRsZSIsInJhbmdlIjoiMnkifQ%3D %3D
So not really the right time but what would I know

[trader_jackson]

https://nzx.com/files/attachments/265334.pdf

Fantastic update, should really be marked price sensitive.

[janner]

Why ????..

[trader_jackson]

Why ????..

Mainly, "Stock levels are low across our villages with many villages now operating a priority waitlist secured by deposits. Normally we would see some softening in enquiry levels leading up to elections but, to date, this has not been the case."

[janner]

Mainly, "Stock levels are low across our villages with many villages now operating a priority waitlist secured by deposits. Normally we would see some softening in enquiry levels leading up to elections but, to date, this has not been the case."

So they have nothing to sell at present .. What is " Price sensitive " about that ??.

[trader_jackson]

So they have nothing to sell at present .. What is " Price sensitive " about that ??.

Sounds like a profit upgrade to me, alongside higher occupancy rates

[janner]

Sounds like a profit upgrade to me, alongside higher occupancy rates

Not convinced..

Disc. Hold.

[Jantar]

Not convinced..

Disc. Hold.Convincing enough for me to take a wee bite at $1.28

[trader_jackson]

Convincing enough for me to take a wee bite at $1.28

Exactly, very interesting (and pleasing) update. Don't have cash to take advantage unfortunately

[janner]

Exactly, very interesting (and pleasing) update. Don't have cash to take advantage unfortunately

Maybe $1.20 could change my mind.. Do not have cash also.

[macduffy]

I'd be tempted, too. Except for:

Another same - sector investment would have to go. MET?

Technically, ARV looks a bit weak to my untrained eye. RSI is down and trending further.

[King1212]

Raising capital via offer of 1 to 5 @ $1.15....

Going to see a sell off n moving to OCA ..TJAckson?

[Jantar]

Raising capital via offer of 1 to 5 @ $1.15....

Going to see a sell off n moving to OCA ..TJAckson? I would think a buy in rather than a sell off. " Immediately accretive to underlying earnings with 8% lift in pro forma FY18 eps"

[winner69]

That Village on the Park amazing place. Go past it a lot and think of Don Clarke, Alan Hewson, Stu Wilson Bernie Fraser etc and the times of sitting on the Western Bank and atop the Millard Stand in a southerly.

Very well put together village. Should flatten Eden Park and do the same - mix of retirement village and affordable housing would solve a lot of problems

[trader_jackson]

https://nzx.com/files/attachments/265622.pdf

Really quite fantastic - There is nothing bad or concerning in this presentation, in fact there is nothing even ok... it is all good!
This confirms ARV moving towards higher growth and I can't wait to take part in yet another EPS accretive transaction for yet another couple of very high quality villages - well done Arvida, and very nice of you to give everybody else a chance to get in on the action with a record date of September 20.

[Snow Leopard]

Nice that you will be able to do the offer acceptance via the interweb thing, but the website: http://www.arvidashareoffer.co.nz/ is rather minimalist.
They should really have got me in to at least put a tiger picture up for them as per http://papertiger.asia/

Best Wishes
Paper Tiger

[trader_jackson]

You know the market isn't 'working' when ARV's share price goes down, despite making an immediately EPS accreditation acquisition on very favorable terms (in my view).

Looks to be a bit of retail panic, clearly they must have missed today announcement.

[Snow Leopard]

...or they are selling now what they can buy 'back' at $1.15 in a month.

Best Wishes
Paper Tiger

[trader_jackson]

Perhaps more impressive, Forsyth have a price target of $1.55 per share (back in May, in their review of ARV's annual results), maybe they knew another acquisition was in the pipeline ;)

Then again, they only forecast 26.4m underlying profit for FY18, on slide 16 they seem to indicate they will achieve $28m + an extra 8% per share on top of that (am I reading that right?)

So we could see underlying EPS of 9.0, a nice 16.9% increase on last years - will they beat Ryman's growth rate for the 2nd year running?
(we won't bother comparing PE's as we know Ryman is way higher... not to mention all the other factors, like a nice dividend [not peanuts] and the more conservative debt levels etc etc)

[peat]

the website: http://www.arvidashareoffer.co.nz/ is rather minimalist.

:):):)

greenfields brownfields and now white fields

[hardt]

I drunkenly purchased a whole bunch at 127 today, this is generally a pre-cursor to downward movements... you have been warned.

[tim23]

I thought I was the only one who had that effect!
I drunkenly purchased a whole bunch at 127 today, this is generally a pre-cursor to downward movements... you have been warned.

[kiora]

As long as they then go up all will be well :)

[dabsman]

This is a great company. I love the way they reward existing holders. All they now need is a DRP

[Benny1]

This is a great company. I love the way they reward existing holders. All they now need is a DRP

Would also love them to do a DRP... Thought there could be some merit in it for
a young small company that's growing.
Some will suggest that you can just re-invest your dividends anyway,however this comes with a broker cost which as a small holder makes this unattractive.
Also with a DRP it gives the company certainty over how much will be re-invested.
Just my two cents worth. 😀

[trader_jackson]

This is a great company. I love the way they reward existing holders. All they now need is a DRP

I have said on here for quite a long time now that I wish they had a DRP - I was going to then say it would be great to have this question asked at the AGM, but that has just been!

I am tempted to email investor relations over at ARV and ask if they have considered it.

[Benny1]

I have said on here for quite a long time now that I wish they had a DRP - I was going to then say it would be great to have this question asked at the AGM, but that has just been!

I am tempted to email investor relations over at ARV and ask if they have considered it.

Good idea! I will try to remember to send one myself. 😃

[hardt]

I drunkenly purchased a whole bunch at 127 today, this is generally a pre-cursor to downward movements... you have been warned.

Ramped up again at 123 today.

Not drunk this time.

[troyvdh]

Great discussion guys...been there done that..cheers

[dabsman]

So Ex date is tomorrow for the rights. If I buy today I an GUARANTEED to to rights? I just want to make sure there isn't some clearing period etc?

[macduffy]

So Ex date is tomorrow for the rights. If I buy today I an GUARANTEED to to rights? I just want to make sure there isn't some clearing period etc?

Yes, that's how it works.

https://www.nzx.com/companies/ARV/announcements/307065

[JeremyALD]

Wow $1.20 now. Never thought I'd see it back at this level.

[trader_jackson]

Neither did I,EPS up 8% on acquisition, share price accordingly goes up to $1.33 after thatgreat announcement, then upon low volume, trends down todays $1.20… I thoughtOCA was cheap (and still is) but this looks to (unfortunately) start giving OCAsome serious competition if this trend, somehow, continues.

[dabsman]

Yeah ex rights - I didnt buy yesterday as I didnt trust it would transact in time to get the rights on top. I'll buy more via my current rights and I'll keep filling up at $1.20. The eps will look good after these are integrated into the pyramid scheme. Question is will the rights be best to buy or the head share to increase my holding?

[dabsman]

And I wish this share would be added to ASB's Margin list... I hate buying shares that dont increase my limit!

[Benny1]

;)
Would also love them to do a DRP... Thought there could be some merit in it for
a young small company that's growing.
Some will suggest that you can just re-invest your dividends anyway,however this comes with a broker cost which as a small holder makes this unattractive.
Also with a DRP it gives the company certainty over how much will be re-invested.
Just my two cents worth. 

Have sent an email to investor relations regarding DRP.... Reply says they are not considering one at this point in time....Bit of a shame really!

[Snow Leopard]

https://nzx.com/files/attachments/267516.pdf

Cleared the shortfall at $1.215 which is a relief.

Apart from taking up my entitlement I also bought more rights on market.

PT

[trader_jackson]

Forsyth back at it again with their coverage

They have a 12 month target on ARV some 36.4% higher than where it is trading right now (and that number is above 40 when you consider the cash dividend yield).

I suppose 'the dog' that is Arvida is back to being the cheapest on the market - just like the good old days.

[trader_jackson]

https://www.odt.co.nz/business/coverage-arvida-group-reinstated

Sounds good, but it also sounds like I'll have less chance to keep handing my capital to ARV to get an above bank dividend, capital gain all via EPS accretive acquisitions... I suppose "ya can't win em' all!"

[winner69]

https://www.odt.co.nz/business/coverage-arvida-group-reinstated

Sounds good, but it also sounds like I'll have less chance to keep handing my capital to ARV to get an above bank dividend, capital gain all via EPS accretive acquisitions... I suppose "ya can't win em' all!"

What can go wrong ....nothing

No worries

[Oliver Mander]

Just bought some more at 117. Still regard this as a conservative (safe) stock long-term, with a stable outlook and good potential for upside growth. Even with minimum wage impacts coming via Labour/NZ First.
A bit surprised at the bounce downwards post rights issue, but increasing my holding as a result...a possible risk, but time will tell whether that's a wise decision, or whether I've bought into a longer-term downtrend...

[JeremyALD]

Wow shares now available at rights issue price. I didn't need to go to all of the effort of filling in forms!

[Valleytrader]

Worth consideration at current levels, with net assets per share of around 111 cents (net tangible assets per share of around 95 cents), and earnings per share of 17.4 cents.

[tipsy]

Wow shares now available at rights issue price. I didn't need to go to all of the effort of filling in forms!


Yeah topped up at 1.16 and got the payout for not taking up the rights issues.

[trader_jackson]

SPH this morning showing Forsyth Barr loading up lately... not surprising given they reckon its worth $1.61 within the next 12 months. Nice to see they are putting their money where their mouth is, just still hard to believe ARV is even more undervalued than the extremely undervalued OCA.

[King1212]

SPH this morning showing Forsyth Barr loading up lately... not surprising given they reckon its worth $1.61 within the next 12 months. Nice to see they are putting their money where their mouth is, just still hard to believe ARV is even more undervalued than the extremely undervalued OCA.

property bubble...scared all investors mate..will see the sector affected for a while...

[winner69]

SPH this morning showing Forsyth Barr loading up lately... not surprising given they reckon its worth $1.61 within the next 12 months. Nice to see they are putting their money where their mouth is, just still hard to believe ARV is even more undervalued than the extremely undervalued OCA.

Might have needed more for their shorting customers.

[winner69]

You know it’s not a very good announcement when the headline just reads “Momentum Builds”

https://quoteapi.com/resources/da9866271f9d0071/announcements/arv.nzx/310682/ARV_Momentum_Builds.pdf

[Ggcc]

You know it’s not a very good announcement when the headline just reads “Momentum Builds”

https://quoteapi.com/resources/da9866271f9d0071/announcements/arv.nzx/310682/ARV_Momentum_Builds.pdf

I thought the exact same thing

[hardt]

They could have named the result - ARVIDA DELIVERS 29% LIFT IN UNDERLYING EARNINGS FIRST HALF FY 2018

[Oliver Mander]

You know it’s not a very good announcement when the headline just reads “Momentum Builds”

https://quoteapi.com/resources/da9866271f9d0071/announcements/arv.nzx/310682/ARV_Momentum_Builds.pdf

The numbers look quite good though. Continues the underlying increase compared to the previous 1H's...and sets up another good Full year too.
Couldn't see anything on the outlook though...although their comments on property valuations are interesting...not really expecting a big slowdown nationally...

[JeremyALD]

Good result, my main concern is the step increase in operating expenses. Seems staffing is costing them a lot more after the pay settlement

[winner69]

They could have named the result - ARVIDA DELIVERS 29% LIFT IN UNDERLYING EARNINGS FIRST HALF FY 2018

Better than ARVIDA DELIVERS 7% LIFT IN EPS

Only 7% - cant be right ...for a growth company that is

[trader_jackson]

I agree, the headline was far to conservative... turns out it really was the worst part, the announcement itself was pretty good. Few percentage points more and we'll be where the famed Ryman is at - and that is trading at wild premiums, off the charts even, compared to ARV.

What makes it more impressive is their margins (not only on new units but also resales), and the fact that only 1 unit was delivered this 1st half and 94 are on the way in the second half – this really is a result skewed to the 2nd half of the year in a massive way! (not to mention new sale settlements are expected to be 70 vs just 3 in the 1sthalf)

In for a bumper full year result and big FY19 (and looks to be reasonable FY20 on the way as well). Despite a very good result, Mr Market seems to be not amused and probably waiting to see how much this apparent property slowdown impacts (maybe?)

Weird that the Net Implied Value per Share is apparently $1.19, above the current share price, then again ARV is the original dog andshould trade at a discount.

Crazy that this result seems to be largely due to their care division, which some have said on sharetrader "delivers no or negative profit"... imagine when things start to ramp up even just a tad? (which they will, already are really)... Momentum really is building... hey! maybe that wasn't such a bad headline afterall?

[hardt]

I agree, the headline was far to conservative... turns out it really was the worst part, the announcement itself was pretty good. Few percentage points more and we'll be where the famed Ryman is at - and that is trading at wild premiums, off the charts even, compared to ARV.

What makes it more impressive is their margins (not only on new units but also resales), and the fact that only 1 unit was delivered this 1st half and 94 are on the way in the second half – this really is a result skewed to the 2nd half of the year in a massive way! (not to mention new sale settlements are expected to be 70 vs just 3 in the 1sthalf)

In for a bumper full year result and big FY19 (and looks to be reasonable FY20 on the way as well). Despite a very good result, Mr Market seems to be not amused and probably waiting to see how much this apparent property slowdown impacts (maybe?)

Weird that the Net Implied Value per Share is apparently $1.19, above the current share price, then again ARV is the original dog andshould trade at a discount.

Crazy that this result seems to be largely due to their care division, which some have said on sharetrader "delivers no or negative profit"... imagine when things start to ramp up even just a tad? (which they will, already are really)... Momentum really is building... hey! maybe that wasn't such a bad headline afterall?



This half entirely comprised of resales as was expected... focus is on that large pipeline moving along.




Forward Underlying PE
FY18E
FY19E
Notes to FY19








ARV - $1.18
15-17x
13-14x
Pipeline focused on FY19 - Relying on resale's for FY18









Care outperformed expectations and the rest met expectations... therefore this result was fairly solid.

Also... 4% yield is great too, a lot to like about ARV at current price IMO.

[winner69]

Real profit down

http://www.sharechat.co.nz/article/3cca0cf8/arvida-s-1h-net-profit-dips-on-lower-portfolio-valuation.html?utm_medium=email&utm_campaign=Arvidas%201H%20net%20profit%20dips%20 on%20lower%20portfolio%20valuation&utm_content=Arvidas%201H%20net%20profit%20dips%20o n%20lower%20portfolio%20valuation+CID_153b17716db7 0a9ac17fee4e2df7235b&utm_source=Email%20marketing%20software&utm_term=httpwwwsharechatconzarticle3cca0cf8arvida-s-1h-net-profit-dips-on-lower-portfolio-valuationhtml

[Arbroath]

Real profit down

http://www.sharechat.co.nz/article/3cca0cf8/arvida-s-1h-net-profit-dips-on-lower-portfolio-valuation.html?utm_medium=email&utm_campaign=Arvidas%201H%20net%20profit%20dips%20 on%20lower%20portfolio%20valuation&utm_content=Arvidas%201H%20net%20profit%20dips%20o n%20lower%20portfolio%20valuation+CID_153b17716db7 0a9ac17fee4e2df7235b&utm_source=Email%20marketing%20software&utm_term=httpwwwsharechatconzarticle3cca0cf8arvida-s-1h-net-profit-dips-on-lower-portfolio-valuationhtml

Are you trying to be deliberately misleading?

[hardt]

Real profit down

http://www.sharechat.co.nz/article/3cca0cf8/arvida-s-1h-net-profit-dips-on-lower-portfolio-valuation.html?utm_medium=email&utm_campaign=Arvidas%201H%20net%20profit%20dips%20 on%20lower%20portfolio%20valuation&utm_content=Arvidas%201H%20net%20profit%20dips%20o n%20lower%20portfolio%20valuation+CID_153b17716db7 0a9ac17fee4e2df7235b&utm_source=Email%20marketing%20software&utm_term=httpwwwsharechatconzarticle3cca0cf8arvida-s-1h-net-profit-dips-on-lower-portfolio-valuationhtml

What do you consider "real profit"

One would think real profit to be operating profit irrespective of revaluations...

28% revenue growth
29% earnings growth

[trader_jackson]

Crazy that other growth company, F&P barely grew at half the rate ARV did, and ARV's dull year profit is extremely skewed towards the 2nd half of this year (As noted above). No wonder the share price closed up (And all the other operators closed down or no change)

[trader_jackson]

Saw Mr McDonald mentioned to NBR: "we're not actually seeing any slowdown in sales, either from resales or new stock, which is really pleasing". Due to the drivers of demand, namely being Arvida's "needs-based portfolio" - something I have been saying since day 1. (sum others seem to be hitting the rocks in resales, and new stock, but no worries... big last quarter on the way for them and they never miss their forecasts, well except ryman who didn't post their 15% growth for the first time in a decade or something like this, but sum others will never slow down!)
He also said that the whole wage thing wasn't going to impact ARV in the long run... specifically mentioning "In the longer term, we don't think it's actually going to impact us, on the basis that our occupancy levels are very strong and it's enabling us to provide strong premium charging on our products and that's offsetting the increased costs"

Forsyth reckon there is a strong few years coming up:

Their Forecast near-term development pipeline:
FY2018: 96 Units (company mentioned today it expects it to be 95, with 94 or about 99% of them delivered in the 2nd half)
FY2019: 101 units + 36 beds
FY2020: 175 units + 60 beds
FY2021: 70 units + 60 beds
So Forsyth reckon another near 600 on the way in 3 and a half years, and another 530 in planning stage (although about 92 of those 530 in planning stage may be included in Forsyth's 598 - so we'll just say in total well over 1000 units over the next 5 ish years).

Crazy that just 6 months ago, at FY2017, they had just 262 (or about half of what they have today) in "development construction activity"... Units/beds under construction: 14 in 2015, 24 in 2016, 262 in 2017, 506 in 2018... 700 in 2019?

Gets even more crazy when you consider they delivered just 5 (yes five) units or beds in 2015 and 2017 ("big year" in 2016 with 32 units delivered)... now they are delivering the previous 3 years added together multiplied by 2.1, in just the next 6 months. I don't usually put things in bold but that was so amazing I felt I had to.

On another note, I thought 95% was pretty amazing, but the care facility occupancy actually increased to 96% - basically full capacity (given the usual movements), and, as they have mentioned, "significantly" above industry average.

Finally, Won't bother going into the impressive margins (and numbers) of resales either... 33 in 2015, 149 in 2016, 166 in 2017, probably around 200 in 2018 (already half way there).

It is no wonder Forsyth reckon ARV is the most undervalued operator, although I'm sure OCA at 94c isn't far behind.

[winner69]

C'mon t_j show a bit more enthusiasm

SUM othe posters are more enthusiastic than you about their favourite company in this sector and give more compelling reasons to buy

You can do better mate, try a bit harder and even I might be convinced to become a shareholder

[winner69]

Interim has this bit - net implied value increased to $1.19 a share, up 1.6% in this financial year

What is this “net implied value”?


Just trying to make sense of their financials seeing t_j has failed in his duty to do so

[winner69]

Just before the recent big acquisition and rights issue ARV market cap was $431m

From the rights issue and payment to the vendor they have raised $93m of new capital

Market cap today is $420m - less than it was pre acquisition .....and they have taken on more debt

Half year NPAT was less than corresponding period last year

Don’t know what all this means but market value added declining seems to suggest the market is not too impressed at what’s going on



think my sums are right

[tipsy]

Not a lot of sellers at the moment, sp in for an upgrade?

[trader_jackson]

Just before the recent big acquisition and rights issue ARV market cap was $431m

From the rights issue and payment to the vendor they have raised $93m of new capital

Market cap today is $420m - less than it was pre acquisition .....and they have taken on more debt

Half year NPAT was less than corresponding period last year

Don’t know what all this means but market value added declining seems to suggest the market is not too impressed at what’s going on



think my sums are right

I don't usually use NPAT to determine how well one of the listed operators are doing, I didn't think you did either winner... I reckon they (the sector themselves) don't really trumpet this measure as the headline because we all know it includes bigly house gains... so I look at underlying: underlying EPS up 7%, margins on units growing nicely, and a very big 2nd half on the cards... sort of similar to Ryman who reported today (who also expect to have a bigger 2nd half - although not on the same bigly scale as ARV).
But wait there is more: RYM's margins are the lowest in years by the looks of it (ARV's are the highest ever) and ARV is (as I speculated earlier) just a few percentage points behind the all mighty R Y M. Remember also they raised capital at $1.15... share price has never finished been below that point since like a year ago, no worries!

Surprising really that the market likes Ryman's result so much, yet seemed unconcerned with Arvida's just a few days earlier (pushing RYM, who is already trading at elevated levels, to even higher elevated levels... crazy really)

Market seems to have re-rated ARV down a bit in recent months... not sure why because everything looks (and confirmed yesterday - is) pretty good.

I suppose it is no wonder Forsyth say it is the most undervalued in the sector!
(they reckon ARV is trading on a FY19 estimated PE of 12.1, while Ryman is a massive 63% higher at 19.7... even Summerset, the one that has the high gearing for the high growth, is higher at 12.8)

While the market wonders how to value ARV, holders and I will keep getting a 4% ish dividend (at today's price), the next 1.15c being paid just 10 days before Christmas - could the timing be any better?

[winner69]

Say you have a house in Auckland that increased in value from 1/2 mill to 1 mill over the last year

You haven’t sold so your underlying profit is zilch / zero

But your profit over the last year is 1/2 mill .....and your assets are worth 1/2 mill than a year go

Why use underlying profit?

[trader_jackson]

Say you have a house in Auckland that increased in value from 1/2 mill to 1 mill over the last year

You haven’t sold so your underlying profit is zilch / zero

But your profit over the last year is 1/2 mill .....and your assets are worth 1/2 mill than a year go

Why use underlying profit?

But I can't go out and spend that half a million increase? So my underlying profit might as well be 0... it is no use to me now, if anything I will just have to pay more rates... a cash money outflow straight to Phil & Co's bank account

Why 'use' what you can't use?

[winner69]

But I can't go out and spend that half a million increase? So my underlying profit might as well be 0... it is no use to me now, if anything I will just have to pay more rates... a cash money outflow straight to Phil & Co's bank account

Why 'use' what you can't use?

But you worth 1/2 mill more and if I was going to buy you out wouldn't you want at least 1 mill ......put that in context of an ARV share valuation why real profits / book value / cash flows are a better guide to valuing them

Underlying profits a good measure of how they are doing operationally on a year by year basis

Don't think you will be convinced that underling profit multiples aren't really such a good thing

[trader_jackson]

But you worth 1/2 mill more and if I was going to buy you out wouldn't you want at least 1 mill ......put that in context of an ARV share valuation why real profits / book value / cash flows are a better guide to valuing them

Underlying profits a good measure of how they are doing operationally on a year by year basis

Don't think you will be convinced that underling profit multiples aren't really such a good thing

You're right, I am not convinced underling profit multiples aren't really such a good thing... but I am convinced we will see a very strong 2nd half... market isn't convinced of anything by the looks of it which is weird because they are lapping up RYM's result

However, I would accept a $2.50 takeover offer for ARV or PEB

[winner69]

You're right, I am not convinced underling profit multiples aren't really such a good thing... but I am convinced we will see a very strong 2nd half... market isn't convinced of anything by the looks of it which is weird because they are lapping up RYM's result

However, I would accept a $2.50 takeover offer for ARV or PEB

You have to be impressed with Ryman’s $202m NPAT though - 8% ahead of last year when ARV was down

Wonder why revaluations at ARV were so much less than last year when it looks like they have more properties?

[trader_jackson]

You have to be impressed with Ryman’s $202m NPAT though - 8% ahead of last year when ARV was down

Wonder why revaluations at ARV were so much less than last year when it looks like they have more properties?

I think we will see a 'significant' lift in the fair value of completed investment properties and development land (and cash flows), once a full valuation is undertaken at the end of the year (which will include significantly more delivered properties - about 99% of the years deliveries in fact)

Time will tell

[trader_jackson]

$1.20... the highest price in a month... Mr Market must be beginning to read throuh the interim report.
Clearly Mr Market has not read much of it because if it did, the share price would be much higher than $1.20

[Beagle]

But you worth 1/2 mill more and if I was going to buy you out wouldn't you want at least 1 mill ......put that in context of an ARV share valuation why real profits / book value / cash flows are a better guide to valuing them

Underlying profits a good measure of how they are doing operationally on a year by year basis

Don't think you will be convinced that underling profit multiples aren't really such a good thing

A profit is not a profit until its realized. The situation you describe is referred too in the industry as embedded value. You can get a good handle on forecasting future underlying profits from resales by looking at total embedded value in the balance sheet at any point in time and dividing by about 7 to give an indication based on historical churn rates of what the expected realization will be in the year ahead.

[winner69]

A profit is not a profit until its realized. The situation you describe is referred too in the industry as embedded value. You can get a good handle on forecasting future underlying profits from resales by looking at total embedded value in the balance sheet at any point in time and dividing by about 7 to give an indication based on historical churn rates of what the expected realization will be in the year ahead.


I obviously don’t explain things very well

So is today’s ‘valuation’ (company worth) dependent upon this embedded value?

Nobody has answered my query as to what this ‘net implied value increased to $1.17 a share’ statement means.

[Snow Leopard]

...

Nobody has answered my query as to what this ‘net implied value increased to $1.17 a share’ statement means.

https://stocknessmonster.com/announcements/arv.nzx-301617/ page 8

now what was ORA & DMF again ?

PT

[winner69]

https://stocknessmonster.com/announcements/arv.nzx-301617/ page 8

now what was ORA & DMF again ?

PT

Thank you mr Tiger

Didn’t think of going back to March presentation

So gone from $1.16 to $1.17 over last 6 months ....doesn’t seem very much

[Deej5]

Thank you mr Tiger

Didn’t think of going back to March presentation

So gone from $1.16 to $1.17 over last 6 months ....doesn’t seem very much


And from $1.36 to $1.17 over last 10 months ... go figure.

[hardt]

I obviously don’t explain things very well

So is today’s ‘valuation’ (company worth) dependent upon this embedded value?

Nobody has answered my query as to what this ‘net implied value increased to $1.17 a share’ statement means.

Another name for NTA

[Snow Leopard]

Another name for NTA

You did not follow the link I provided did you ?

[winner69]

Another name for NTA

Don't think so

NTA reported as $0.98

This net implied value of $1.19 as per Paper Tiger

[hardt]

You did not follow the link I provided did you ?

Did not see your post... would have said anything to stop the persistent questioning.

[winner69]

And from $1.36 to $1.17 over last 10 months ... go figure.

All to do with all the new shares they have issued ....130 million extra since Sep16

They say everything is eps accretive so we must trust them

Still haven’t sussed why revaluations were so low in H1 - compared to pcp as well as to likes of Ryman and Summerset on a relative basis. They say the H1 $8.9m was mainly from recently acquired villages, does this suggest older villages not getting more valuable

[trader_jackson]

All to do with all the new shares they have issued ....130 million extra since Sep16

They say everything is eps accretive so we must trust them

Still haven’t sussed why revaluations were so low in H1 - compared to pcp as well as to likes of Ryman and Summerset on a relative basis. They say the H1 $8.9m was mainly from recently acquired villages, does this suggest older villages not getting more valuable

Possibly does suggest older villages are not getting that much more valuable, but then again they haven't seen noticeable weakness... maybe they are just given the folk in Christchurch a better deal?
Embedded value still climbing and this 2nd half around 65 villas are to be delivered (the villas have 2x higher embedded value, as I'm sure you know, compared to serviced apartment... must mean something good) and begin sell down of these many villas this 2nd half (a large majority of the huge, by dog standards, 94 total deliveries expected this half)

Would not surprise me to see a 'jump' in fair value of investment properties in the 2nd half, not only due to more being delivered and sold, but also given in the 2017 financial year, 2nd half revaluations accounted for about 64% of the full year.

Although ARV is only up 4.6 ish percent this year, ARV's track record of delivering shareholder value, a fair bit via EPS accretive acquisitions, they've pretty good so far especially given they are the 'original dog'
sum other operators haven't even returned half a peanut, sorry half a percent, the last 52 weeks according to NZX's website

[ddrone]

Another big off-market trade this morning to open. Looks like someone is accumulating on the sidelines?

[winner69]

ARV don't seem to have given any guidance for F18 except that he 3 new villages will add $9m of underlying profit

Anybody done any sums or have any idea what their actually underlying profit for F18 could be - a bit more specific than awesomely amazing would be appreciated.

[trader_jackson]

ARV don't seem to have given any guidance for F18 except that he 3 new villages will add $9m of underlying profit

Anybody done any sums or have any idea what their actually underlying profit for F18 could be - a bit more specific than awesomely amazing would be appreciated.

With ARV delivering 99% of its villas and apartments and stuff this 2nd half, and the usual strong continuing resales of existing stuff (unlike sum operators), I'll let them off so they can focus on getting all the synergies and delivers sorted, before delivering a bumper profit (and outlook for the coming year) come the big day in 2018.
Management may even be considered generous giving everyone else a chance to get on board while ARV is still the cheapest operator on the NZX (and the recent trades would indicate time is running out)

Forsyth, reckon $30.7m underlying in 2018 full year (yes, a bigly 2nd half on the way - as I've mentioned already), jumping a massive third to $40.2m in 2019.

But be careful because Forsyth were pretty conservative... they thought ARV's half year would be just $11.0m underlying (it was actually $12.4m - a whooping 13% higher than Forsyth thought... maybe they are the ones buying even more for their clients or something?)

Forsyth thought RYM would deliver 85.0, they were nearly bang on as they actually delivered 85.2 underlying so they must be kinda good at estimating this sector, well estimating some, underestimating others anyway.

[hardt]

ARV don't seem to have given any guidance for F18 except that he 3 new villages will add $9m of underlying profit

Anybody done any sums or have any idea what their actually underlying profit for F18 could be - a bit more specific than awesomely amazing would be appreciated.


Without going into too much detail - *Expecting* 2H18 to be 20-30% higher than that of 1H18.

Would bring the FY18 NPAT to 26-29m ( +15-25% PCP )

1H19 is expected to be a cracker as well with a boat load of completed villas selling down.

[trader_jackson]

Opened up an old Forsyth report on Arvida back in the dark old dog days of July 28 2015 (when the share price was 87c)
They gave ARV a target price of $1.14... they thought underlying EPS would be:
2017: 6.6c (was actually 15.2% higher, being 7.6c)
2018: 6.8c (estimated to be 22.1% higher, being 8.3c - estimated on most recent report being November 22 2017)
2019: probably thought it would be 7.0c - in the most recent report they reckon it is going to be 38.6% higher - being 9.7c

Share price barely above the $1.14 they thought ARV would be at within 12 months of July 28 2015 (the $1.14 being on those dog like growth rates as well!)... shoot, must be cheapo

For the record, 1 year later, July 28 2016 the share price was $1.14... imagine if they are right this time around and ARV hit Forsyth's 22 November 2017 12 month target price of $1.61?!
Words can no longer explain how cheap ARV must be

[hardt]

Opened up an old Forsyth report on Arvida back in the dark old dog days of July 28 2015 (when the share price was 87c)
They gave ARV a target price of $1.14... they thought underlying EPS would be:
2017: 6.6c (was actually 15.2% higher, being 7.6c)
2018: 6.8c (estimated to be 22.1% higher, being 8.3c - estimated on most recent report being November 22 2017)
2019: probably thought it would be 7.0c - in the most recent report they reckon it is going to be 38.6% higher - being 9.7c

Share price barely above the $1.14 they thought ARV would be at within 12 months of July 28 2015, based on those dog like growth rates... shoot, must be cheapo


Dirt cheap and paying a solid dividend.

[winner69]

With ARV delivering 99% of its villas and apartments and stuff this 2nd half, and the usual strong continuing resales of existing stuff (unlike sum operators), I'll let them off so they can focus on getting all the synergies and delivers sorted, before delivering a bumper profit (and outlook for the coming year) come the big day in 2018.
Management may even be considered generous giving everyone else a chance to get on board while ARV is still the cheapest operator on the NZX (and the recent trades would indicate time is running out)

Forsyth, reckon $30.7m underlying in 2018 full year (yes, a bigly 2nd half on the way - as I've mentioned already), jumping a massive third to $40.2m in 2019.

But be careful because Forsyth were pretty conservative... they thought ARV's half year would be just $11.0m underlying (it was actually $12.4m - a whooping 13% higher than Forsyth thought... maybe they are the ones buying even more for their clients or something?)

Forsyth thought RYM would deliver 85.0, they were nearly bang on as they actually delivered 85.2 underlying so they must be kinda good at estimating this sector, well estimating some, underestimating others anyway.

OK running with Forbars forecast

Underlying profit F17 was $23.1 and Forbar guess is $30.7m

That means EPS goes from 7.7 cents in F17 (Arvida report) to about 10 cents in F18 (depending on how they calculated the weighted average number of shares)

Suppose not to bad but if Forbars guess allows for the $9m extra from the recent acquisitions (what Arvida) says not all that good.

Struggling to find a compelling reason to rush out and buy here .....

[trader_jackson]

OK running with Forbars forecast

Underlying profit F17 was $23.1 and Forbar guess is $30.7m

That means EPS goes from 7.7 cents in F17 (Arvida report) to about 10 cents in F18 (depending on how they calculated the weighted average number of shares)

Suppose not to bad but if Forbars guess allows for the $9m extra from the recent acquisitions (what Arvida) says not all that good.

Struggling to find a compelling reason to rush out and buy here .....

Don't worry, you're not the only one winner... Mr Market seems to be as well (although slowly coming around)

So I'll put it in earnings per shares so we can see how the acquisition impacts things, per share wise (which is the important part, right?)
Normalised EPS (cps) was 7.6c n 2017 according to Forsyth's recent report, they reckon it is going to be 8.3c a share in 2018, so that means growth of about 10% per share, not bad given a very quiet 1st half, deliveries wise anyway... it is no wonder then that they reckon EPS in 2019 is going to be 9.7c, a healthy 14 and a bit percent growth from the prior year (and in 2020 10.8c a solid 11 and a bit percent growth from the prior year)

Man, 2018 looks to be the quietest year in the next 3 years... no wonder the share price has been (so far) pretty 'quiet' as well... will start making alot more noise (relayed in the form of gains) in the following years it would seem... maybe ARV is just a bit to steady and solid for you to be tempted winner? Maybe a dabble in the famed xero could be better? much more exciting with all the unexpected disruption, announcements and changes etc, much more so than boring earnings per share accretive acquisitions anyway
... oh and forsyth are conservative, well have been in the past anyway... they can't predict when ARV's excellent, and proven (sort of), management will buy another EPS accretive village and/or greenfield site with high quality development opportunities.

[winner69]

The much revered 4-traders have ARV net income (npat) going backwards fir the next few years. Must be wrong - can’t trust free stuff on the internet

http://www.4-traders.com/ARVIDA-GROUP-LTD-20708484/financials/

[winner69]

Don't worry, you're not the only one winner... Mr Market seems to be as well (although slowly coming around)

So I'll put it in earnings per shares so we can see how the acquisition impacts things, per share wise (which is the important part, right?)
Normalised EPS (cps) was 7.6c n 2017 according to Forsyth's recent report, they reckon it is going to be 8.3c a share in 2018, so that means growth of about 10% per share, not bad given a very quiet 1st half, deliveries wise anyway... it is no wonder then that they reckon EPS in 2019 is going to be 9.7c, a healthy 14 and a bit percent growth from the prior year (and in 2020 10.8c a solid 11 and a bit percent growth from the prior year)

Man, 2018 looks to be the quietest year in the next 3 years... no wonder the share price has been (so far) pretty 'quiet' as well... will start making alot more noise (relayed in the form of gains) in the following years it would seem... maybe ARV is just a bit to steady and solid for you to be tempted winner? Maybe a dabble in the famed xero could be better? much more exciting with all the unexpected disruption, announcements and changes etc, much more so than boring earnings per share accretive acquisitions anyway
... oh and forsyth are conservative, well have been in the past anyway... they can't predict when ARV's excellent, and proven (sort of), management will buy another EPS accretive village and/or greenfield site with high quality development opportunities.




You are excited eh t_j but I still can’t see a compelling reason to buy

You mention Xero, nah not for me but finally extracted myself from FLX with a profit and that now all goes into even more Pushpay ...... much better prospects than ARV and at least the market likes them.

[ddrone]

250k through this morning @ 121. Creeping north on relatively big volumes.

[winner69]

250k through this morning @ 121. Creeping north on relatively big volumes.

Jeez it’s got a rocket under it eh ...up to 125

Should’ve listened to you gurus after all .....but Pushpay will see me right

Hope it gets to 130 / 140 soon for guys.

[trader_jackson]

Jeez it’s got a rocket under it eh ...up to 125

Should’ve listened to you gurus after all .....but Pushpay will see me right

Hope it gets to 130 / 140 soon for guys.

Nobody selling now till $1.27 - and even then there ain't many sellers.

You sound surprised winner?
I am sure not... still more than 10c before we get close to a record close, and Forsyth still reckon another good 36 cents can be added to the share price (+ about 5c in dividends) between now and mid November next year, and they are the conservative ones remember... let the run continue.
Mr Market must have decided to read the interim report a bit closer

[winner69]

Hey t_j the share price is falling

Mr Market must have decided to read the interim report a bit (more) closer....and started having doubts

[trader_jackson]

Hey t_j the share price is falling

Mr Market must have decided to read the interim report a bit (more) closer....and started having doubts

Friday last week the share price wasn't over $1.20 - now we are well into the 20's and friday is still to come, hard to believe that a couple weeks $1.20 looked like a distant struggle - today we are at $1.24 - probably just a few people taking advantage of the strong run, good on them.
Might be your chance to get in while it is still over 40c below where forsyth reckon it will be in 11 ish months.

[Longhaul]

Appears "momentum builds" for the share price, nice to see a slow and steady rise on good volume lately.

[winner69]

Appears "momentum builds" for the share price, nice to see a slow and steady rise on good volume lately.

Summerset increased guidance will help punters perception of the sector ......and should flow over to Arvida

[Longhaul]

The ARV chart at the moment is a beautiful thing....

As always though, DYOR.

9426

[janner]

Still a tad ( I mean a tad ). in the red with this one ..

Tomorrow .. Tomorrow.. :-)))

[winner69]

Arvida — the unsung hero of the NZX

It’s full potential will be recognised one day

[winner69]

ARV share price still about the same as it was when they announced the acquisition of 3 villages last September

Market thinking that not positive long term for ARV or something

That Village on the Park in Wellington needs to improve — haven’t heard a good word about it for a long time. Expanding though as they doing a lot of earthworks at the moment.

[Bob]

Do Arvida have a dividend reinvestment scheme? thanks

[Benny1]

Do Arvida have a dividend reinvestment scheme? thanks

No they don't at this stage.

Disc: Holding.

[trader_jackson]

https://www.nzx.com/announcements/315395

Pretty nice to see, I thought the share price weakening in recent times was possibly because people weren't sure if they could deliver on a big 2nd half - today's announcement shows they are going to deliver a massive uplift in the 2nd half. I note in the half year presentation they mentioned "Expected new sale settlements of 70 units in 2H18", that language has now changed to "Arvida is on track to settle at least 70 new unit sales during the second half", maybe the market missed it because their share price actually went down slightly (then again, could be the juicy dividend, being paid in just over a week I suppose).

I suppose the proof will be in the pudding (aka when half year results are released in late May)
You'd think that if sum others can miss their building guidance (or arguably, barely meet it), yet still have a share price jump after results are released, then others who look like they will exceed it, should have a share price skyrocket.

[winner69]

https://www.nzx.com/announcements/315395

Pretty nice to see, I thought the share price weakening in recent times was possibly because people weren't sure if they could deliver on a big 2nd half - today's announcement shows they are going to deliver a massive uplift in the 2nd half. I note in the half year presentation they mentioned "Expected new sale settlements of 70 units in 2H18", that language has now changed to "Arvida is on track to settle at least 70 new unit sales during the second half", maybe the market missed it because their share price actually went down slightly (then again, could be the juicy dividend, being paid in just over a week I suppose).

I suppose the proof will be in the pudding (aka when half year results are released in late May)
You'd think that if sum others can miss their building guidance (or arguably, barely meet it), yet still have a share price jump after results are released, then others who look like they will exceed it, should have a share price skyrocket.

Need you and lots more to think like that and START BUYING to build some positive momentum

Be continue to be pretty ho hum otherwise

[trader_jackson]

Need you and lots more to think like that and START BUYING to build some positive momentum

Be continue to be pretty ho hum otherwise

Hmm yes... as they say, action speaks louder than words
A shame I already own far to many ;)

[thesock]

Hmm yes... as they say, action speaks louder than words
A shame I already own far to many ;)

Newbie observation: This stock seems to be idling despite receiving only positive reinforcement of the current FY plan. Depth shows a huge queue of sellers and not a lot of buyers. I guess everyone is just waiting for the May results?

[Arbroath]

Newbie observation: This stock seems to be idling despite receiving only positive reinforcement of the current FY plan. Depth shows a huge queue of sellers and not a lot of buyers. I guess everyone is just waiting for the May results?

Sentiment can be a funny thing - Arvida are developing a record of delivering on what management say which I think ultimately will see the share price perform better. It's always worth remembering it is business performance that drives the share price long term and not the other way around. I've been long for 2 years and have collected 8-9 cents of dividends in that time and await a stronger share price that reflects their execution of business development but we will see I guess.

[trader_jackson]

Sentiment can be a funny thing - Arvida are developing a record of delivering on what management say which I think ultimately will see the share price perform better. It's always worth remembering it is business performance that drives the share price long term and not the other way around. I've been long for 2 years and have collected 8-9 cents of dividends in that time and await a stronger share price that reflects their execution of business development but we will see I guess.

Mr Market to busy buying sum other shares, pushing them into "very high territory", arguably at ARV's expense.
May May results change that.

[Oliver Mander]

Arvida's put out their "investor news"...what more do they need to do?
https://www.nzx.com/announcements/315544

Struggling to work out why the sentiment is against them...even with higher wages, their story still looks like a pretty good one.

[Filthy]

mr market will come around mate. great buying at these levels imo. expecting a solid result on the 29th May.

[winner69]

Arvida's put out their "investor news"...what more do they need to do?
https://www.nzx.com/announcements/315544

Struggling to work out why the sentiment is against them...even with higher wages, their story still looks like a pretty good one.

Need Forbar to pump it up again methinks

What do you think the share price should be anyway Sylvester

[couta1]

The NTA is basically at the current SP, compared with the likes of SUM who's SP is double it's NTA, looks like good buying at the moment.PS-Would buy some but don't want to dilute my milk holding.

[Oliver Mander]

Need Forbar to pump it up again methinks

What do you think the share price should be anyway Sylvester

I have a target value of around $1.65. Based on long-term discounted earnings cashflows, with some allowance for high investment costs of the recent past (ie, free cash flow over the last 2 years has been negative thanks to all their investing). Not a horrible story though, as their investment has basically been about growth...so when you strip out the growth investment and focus on "base capex" only, I actually come up with a higher number than $1.65, I'm simply then applying a "risk factor" to allow for some variance between what I think is growth capex vs what actually IS growth capex.

Will be VERY interested in the result.

[trader_jackson]

sum other listed retirement operators have a bit more than 2x more assets than ARV, yet their share price is nearly 6x higher - sure it is has grown faster previously by a fair margin (although I think the gap will narrow fast over the coming years), but that is sum difference in valuation that is for sure.

The May result will certainly be of interest
It can't get any worse surely - I don't know what Mr Market is thinking giving arvida a share price under $1.20, despite only positive updates recently.

[trader_jackson]

Forsyth reckon its worth $1.52
Dam cheap at $1.19

[Filthy]

you always make me squint to read your last sentence T_J!

surprised a certain someone hasn't got his paws into this one...

[Beagle]

Hello did someone call the Beagle's name ? Its been such a "paw" performer over the last year I'm starting to wonder if there might be some value at the current price.
Initial thoughts is TA gives zero scope for encouragement right at the minute.

Where do people see 2H FY18 underlying EPS ? I am running the snout and paws over this but want to hear others thoughts first.
Where do people see FY19 Underlying EPS ?

Anyone got any broker research they can send me on this one, please PM me and I'll give you my e.mail address.

[dabsman]

I just picked up more MET and ARV to put away long term as I feel both now undervalued. 1.19c for ARV is stupid cheap I feel so topped up. They are in the same market as the rest doing similar things. Yes there is some execution risk but seriously cant be hard to sit at the end of an aging population and catch their fair share...

[Filthy]

agree TA looks pretty average - & ARV has tracked sideways for most of the year.

buyer depth is also not looking too flash either; so punters may be able to pick-up holdings slightly cheaper on the current weakness…

confident that earnings will be higher in the coming results and provided they don’t drown under the recent issue, I will be hoping for medium-high single digit EPS growth based on the contributions from the three recently acquired villages (EPS accretive) and the delivery of the 94 new units (guidance just confirmed Monday).

plenty in the pipeline too with Ana Bay/Park Lane for 1Q19 and the Park FY20 (with strong sector tailwinds, plus other opportunities).

while I don’t see ARV being able to match the return of SUM others, the 70% of earnings that come from the care segment makes it much more of a defensive hold perhaps akin to some energy/infrastructure stocks, which should attract support.

I believe any uplift in wage costs will be able to be passed on.

While I am not as bullish as Forsyth, I do believe there is some good value here (maybe 15%ish?).

a good long-term set-and-forget hold any which way you want to slice it though - and a reasonable entry price at these levels?

[Joshuatree]

Hello did someone call the Beagle's name ? Its been such a "paw" performer over the last year I'm starting to wonder if there might be some value at the current price.
Initial thoughts is TA gives zero scope for encouragement right at the minute.

Where do people see 2H FY18 underlying EPS ? I am running the snout and paws over this but want to hear others thoughts first.
Where do people see FY19 Underlying EPS ?

Anyone got any broker research they can send me on this one, please PM me and I'll give you my e.mail address.

Even better share it with all of us, just a short summary/snippet.

[trader_jackson]

Hello did someone call the Beagle's name ? Its been such a "paw" performer over the last year I'm starting to wonder if there might be some value at the current price.
Initial thoughts is TA gives zero scope for encouragement right at the minute.

Where do people see 2H FY18 underlying EPS ? I am running the snout and paws over this but want to hear others thoughts first.
Where do people see FY19 Underlying EPS ?

Anyone got any broker research they can send me on this one, please PM me and I'll give you my e.mail address.

Forsyth's thoughts:
(1H 18 underlying EPS of 3.7c) 2H 18 underlying EPS of 4.6 cps = 8.3cps FY 18 - 14.3 underlying PE
FY19 underlying EPS 9.0 - FY19 forward PE of 13.2 (for comparision: RYM is at 22.0, SUM at 16.6, Metlife at 14.5 and OCA at 13.1)

Implied book value of NZ$1.19 and I won't even go into cash dividend yields too much as you already guessed it: ARV is on top (yes, even 7% higher cash dividend yield than OCA at 99c...)

Disclosure: I have put in an order for more ARV shares, despite having 'too many' already.
Seeing this reach $1.60 sometime in the next year would not even been remotely surprising to me.

[winner69]

Forsyth's thoughts:
(1H 18 underlying EPS of 3.7c) 2H 18 underlying EPS of 4.6 cps = 8.3cps FY 18 - 14.3 underlying PE
FY19 underlying EPS 9.0 - FY19 forward PE of 13.2 (for comparision: RYM is at 22.0, SUM at 16.6, Metlife at 14.5 and OCA at 13.1)

Implied book value of NZ$1.19 and I won't even go into cash dividend yields too much as you already guessed it: ARV is on top (yes, even 7% higher cash dividend yield than OCA at 99c...)

Disclosure: I have put in an order for more ARV shares, despite having 'too many' already.
Seeing this reach $1.60 sometime in the next year would not even been remotely surprising to me.

Seems priced about right at the moment then

FY19 EPS at 9.0 cents is only 8% more than FY18 ..... not much growth is it (SUM likely to be ~20%) and you think they deserve the same PE as SUM if not RYM (at least that what's I assume)

[trader_jackson]

Seems priced about right at the moment then

FY19 EPS at 9.0 cents is only 8% more than FY18 ..... not much growth is it (SUM likely to be ~20%) and you think they deserve the same PE as SUM if not RYM (at least that what's I assume)

What is RYM growing their EPS at again?
The dividend (not peanuts) makes up for it somewhat for me anyway
Growth picking up in 2020 and into 2021, a 250% increased in units/beds to be delivered in 2020 and thats without considering over 600 units/beds in planning, but yet to be consented. Meanwhile, growth probably continuing to slow for sum others... I wouldn't be surprised if in 2021 and/or 2022 we see a similar EPS growth rate for arvida as the almighty summerset
bold call by me, nearly as bold as when I called arvida the fastest growing share price a few years back

[Beagle]

Forsyth's thoughts:
(1H 18 underlying EPS of 3.7c) 2H 18 underlying EPS of 4.6 cps = 8.3cps FY 18 - 14.3 underlying PE
FY19 underlying EPS 9.0 - FY19 forward PE of 13.2 (for comparision: RYM is at 22.0, SUM at 16.6, Metlife at 14.5 and OCA at 13.1)

Implied book value of NZ$1.19 and I won't even go into cash dividend yields too much as you already guessed it: ARV is on top (yes, even 7% higher cash dividend yield than OCA at 99c...)

Disclosure: I have put in an order for more ARV shares, despite having 'too many' already.
Seeing this reach $1.60 sometime in the next year would not even been remotely surprising to me.

Forbar's EPS estimates look fairly reasonable to me. There's not nearly as much empirical evidence to work through and development margins are really an unknown at this stage but after a number of assumptions and estimates I arrived at $32-34m underlying profit this year, approx. 8.2 cps at the top end.
I'm not 100% convinced all the increased wage settlement rates will be recovered and see this as a key risk.
Forbar would have spent a ton more time on this than me so my preliminary thinking to form a first impression is simply to accept their earnings estimates which gives underlying earnings growth in the high single figures this year and next.

Forward PE on EPS of 8.3 is 14.3. I have SUM with a proven track record of EPS growth averaging 45% per annum since listing on a forward PE for 2018 of 15.2. which is only a very small multiple premium for such an incredibly attractive well proven track record of growth.

In my opinion OCA most closely resembles ARV's business model and they recently confirmed they're on track to meet IPO guidance of 8.42 cps so on 99 cents this puts them on a forward PE of just 11.75. I think SUM's business model is less susceptible to wage cost pressures due to their predominant independent living model.

Other observations. I think OCA have a significantly higher percentage of consented developments in the pipeline and there's more potential for PE expansion with OCA than ARV due to its present lower multiple. I think OCA could surprise, as could ARV but its early days to make a call on either of these relatively new companies.

I think the slightly higher PE of SUM is well worth paying a premium for considering their six year track record of growing earnings at frankly what has been an astonishing pace.
My first glance impression is I think ARV have a lot to prove with their development model before the market can accord them a higher PE.
In the meantime I see it as a slow and steady player and shareholders are likely to enjoy a ~ 5.5% gross dividend yield in the year ahead and high single digit Underlying earnings growth. Trading at slightly under asset backing, (adjusted asset backing as at 30 Sept 2017 was $1.19) its probably a pretty reasonable hold for the medium term but I have a significant investment in SUM and OCA neither of which I would reduce to add to ARV based on my first impressions.

I remain of the view that RYM's PE is expensive but is probably warranted relative to ARV, less so relative to SUM and OCA....well that's my 2 cents worth and good luck to holders. P.S. I don't like MET and have little confidence in their management or their development model. Further, I think they will find the remediation cost to existing buildings will FAR exceed the costs they've publicly estimated so a significant discount to NTA is well and truly warranted with them.

[trader_jackson]

Forbar's EPS estimates look fairly reasonable to me. There's not nearly as much empirical evidence to work through and development margins are really an unknown at this stage but after a number of assumptions and estimates I arrived at $32-34m underlying profit this year, approx. 8.2 cps at the top end.
I'm not 100% convinced all the increased wage settlement rates will be recovered and see this as a key risk.
Forbar would have spent a ton more time on this than me so my preliminary thinking to form a first impression is simply to accept their earnings estimates which gives underlying earnings growth in the high single figures this year and next.

Forward PE on EPS of 8.3 is 14.3. I have SUM with a proven track record of EPS growth averaging 45% per annum since listing on a forward PE for 2018 of 15.2. which is only a very small multiple premium for such an incredibly attractive well proven track record of growth.

In my opinion OCA most closely resembles ARV's business model and they recently confirmed they're on track to meet IPO guidance of 8.42 cps so on 99 cents this puts them on a forward PE of just 11.75. I think SUM's business model is less susceptible to wage cost pressures due to their predominant independent living model.

Other observations. I think OCA have a significantly higher percentage of consented developments in the pipeline and there's more potential for PE expansion with OCA than ARV due to its present lower multiple. I think OCA could surprise, as could ARV but its early days to make a call on either of these relatively new companies.

I think the slightly higher PE of SUM is well worth paying a premium for considering their six year track record of growing earnings at frankly what has been an astonishing pace.
My first glance impression is I think ARV have a lot to prove with their development model before the market can accord them a higher PE.
In the meantime I see it as a slow and steady player and shareholders are likely to enjoy a ~ 5.5% gross dividend yield in the year ahead and high single digit Underlying earnings growth. Trading at slightly under asset backing, (adjusted asset backing as at 30 Sept 2017 was $1.19) its probably a pretty reasonable hold for the medium term but I have a significant investment in SUM and OCA neither of which I would reduce to add to ARV based on my first impressions.

Interesting thoughts that are appreciated. Agree ARV (and OCA really) have a bit of proving to do with their development model - ARV are, in my view, already beginning to prove they can integrate other villages and develop well - although the latter is in early stages. I would also not be selling OCA for ARV (maybe, at current levels, a bit of SUM - if I was a holder - as I see SUM's growth rate dramatically slowing as they try 'catch up' in the 'care department')

In my 'high level' view, over time, villages like ARV and OCA, with the full continuum of care, will become more attractive than the 'big prisons' that is RYM, SUM and MET (MET especially in my view) and therefore people will be willing to pay a higher amount (eg in care fees or to purchase a unit), hence offsetting the relatively higher cost of smaller, more niche villages, with a far greater continuum of care. Time will ultimately tell if this 'high level' view of mine is right or not.

[Beagle]

Yes I see SUM's growth rate at 20-25% this year compared to 44% last year. 2019 could surprise to the upside with an increase in build rate.
From a TA perspective SUM is a compelling hold as it is from a FA perspective based on the substantially superior growth rate.
I prefer to hold stocks where FA and TA indicators are in sync.

The saving grace with ARV and I think its most attractive aspect is the relatively high nearly fully imputed dividend yield at I would estimate about 5.5% gross this coming year. This yield is something I would see as very safe considering 70% of their earnings are from their care model. Effectively shareholders are being paid a pretty good apparently quite safe yield to participate in a company with reasonable growth prospects operating in a sector with strong demographic tailwinds for the next 20-30 years and this on a fairly reasonable PE multiple. This company's characteristics could have strong appeal to retired investors in my opinion.

Summing up. All things considered I think ARV is a pretty good investment proposition. I think the list of companies in the NZX50 that offer a less compelling proposition is fairly long one but doesn't include OCA or SUM. I'm focusing on higher growth companies but I can see some attraction with ARV so will keep an eye on it.

[couta1]

Ive taken a position in ARV now, at the price SUM others are currently at, I can't see the point in buying, as I see no more, or less upside going forward than ARV and OCA.

[trader_jackson]

Brought more at $1.19 today, taking my holding from L to XL
$1.19 is a 'funny' price for me... on 20 May 2016 I 'went big' into HBL at the same price for similar reasons: solid growth, solid dividend, good industry dynamics, good management, and fairly conservative.
Similar to ARV lately, the share price then with HBL had kinda stagnated for the past year and a half before (and relatively soon after May) steadily climbing well over the $2 mark.
Here's hoping ARV starts that same solid and steady climb.
and starts to give HBL a run for its money ;)

[trader_jackson]

Up again today - $1.23 now
Maybe $1.19 was really just too cheap

[winner69]

Up again today - $1.23 now
Maybe $1.19 was really just too cheap

Be $1.30 AGAIN this week I reckon

Don't forget it hit $1.39 once so not heading into uncharted waters ......once it gets to $1.40 all blue sky ahead ....and then it will finally catch up with HBL

No worries here ....there's little that can go wrong .....top management, bedding down acquisitions not yet price in, strong development pipeline and all that sort of stuff

[winner69]

t_j --- you need to keep on buying if you want the price to go up

No point buying at 119 and then stopping .... ARV needs the likes of to keep on buying to build momentum

[couta1]

t_j --- you need to keep on buying if you want the price to go up

No point buying at 119 and then stopping .... ARV needs the likes of to keep on buying to build momentum I bought some on his behalf at close.

[hardt]

topped up at closing as well.

[winner69]

You guys not buying enough ..... got to get some positive momentum going ....soon, or else it will be back to 110 ...or lower

[King1212]

You guys not buying enough ..... got to get some positive momentum going ....soon, or else it will be back to 110 ...or lower

You are so cheeky winner..

[xavier.downs]

As someone new to retirement villages - why do you guys see Arvida as so valuable? Having gone through the reports, it looks like their actual profit is not so high compared to the market cap. A significant amount of the profit is from real estate value changes which skews the PE ratio a little (especially since I imagine that they won't be selling their land anytime soon? Does this raise the cost of apartments that they sell though?).

Additionally, they said that rising employee costs would be an issue through this year.

Also, I might just not know how to read the reports, but I couldn't see any of their income going back into development projects, it looked like it was just funded on loans.

Really interested in responses.

[winner69]

Back to price last seen in November last year

Not surprising

[JeremyALD]

Hmmm certainly not my best performing share, but pays a pretty good dividend for a retirement stock so I'm happy with that.

[Beagle]

As someone new to retirement villages - why do you guys see Arvida as so valuable? Having gone through the reports, it looks like their actual profit is not so high compared to the market cap. A significant amount of the profit is from real estate value changes which skews the PE ratio a little (especially since I imagine that they won't be selling their land anytime soon? Does this raise the cost of apartments that they sell though?).

Additionally, they said that rising employee costs would be an issue through this year.

Also, I might just not know how to read the reports, but I couldn't see any of their income going back into development projects, it looked like it was just funded on loans.

Really interested in responses.

Welcome to the forum. See my post #482 above but in one sentence I can sum it up as follows. There's plenty to choose from in this sector and others offer far better growth prospects.

[trader_jackson]

Should be just over a month before the full year result is announced. I'm expecting some good things, but the market doesn't seem to know what to expect - but with a share price barely ever trading at or above $1.20 these days, clearly not expecting much...
Time for ARV to smash it out the park and surprise again I say

[sammyc123]

Good to see this one slowly getting some juice in on the way to results. Got worried there for a bit!

[QOH]

We’re hoping to move to an Arvida retirement village very shortly, will have to increase my shareholding in the company.