None so queer as folk! But things are looking up.
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Hi This is my first post but am I missing something - wasn't the license granted 17/12/12
Just to clarify -on behalf of that rogue poster-, for those who came in late: the reserve bank's own rules required three years of prior accounts before an entity is granted a banking licence. My deduction from that was that Heartland in its current form would have to wait three years before a banking licence from the point in time it took over PGW finance. I don't know why the reserve bank did not follow their own rules, and decided to grant a banking licence a little more than a year from the PGW finance takeover. My critics have never offered an explanation as to why either. Mind you since the banking licence has been granted, I would argue the whole issue is now moot anyway. I still stand by my original prediction of not receiving a banking licence for three years given the information I had available to me at the time of making the prediction.
Also I mentioned that I believed Heartland was risky, and I still believe that. That is not the same thing as saying Heratland is on the way to inevitable trouble.
SNOOPY
Snoopy - you sure sniff some strange stuff at times?
finally! over the 75/76 barrier. Now 77. Mouse will be able to breakeven soon. Hopefully be 80s by end of this week or next week. Unfortunately not able to buy more as it is already a big chunk of my small portfolio.
Likely they will be given a 4c dividend for this year based on their earnings, I would estimate (2c now, 2c in Dec). That's basically the same as having money in the bank and earning interest, or actually a little better because its fully imputed and a slightly better than most rates the banks offer.
As such, my estimation of the real price value now for these guys sits at 95c-$1. If they get growth, which is looking likely, there is considerable upside to that value in the medium term. With a 90c NTA, I see no reason why the Heartlands price is below this value at least. However I know why - people still a bit scared to invest in a finance company, especially one with a chequered past that still has a BBB- rating.
Although interestingly Heartlands TDs are at 4.25% for 6 months or 4.45% for a year! This is higher than their dividend (though less after tax).... I wonder if this is telling? Is it better to have money in the bank or own the bank?
I think you are forgetting the Heartland hasn't hit $1 yet.
4c/77c = 5.2% net yeild (7.2% gross)
Much higher than the interest rate being offered. Plus 17% growth to get to NTA. For shareholders on capital account, that will be the equivalent to a 32% interest rate if the share price gets to 90c by the end of 12 months (capital growth of 17% grossed up and div of 7%).
Oh yes, you are right CJ, I was putting the cart before the horse! Good numbers!