A day of surprise, and not just for me (I am sure)
Quote:
Originally Posted by
Baa_Baa
I think they did very well not to be caught immediately in the current sector down draught that would be top of mind for the promoters.
Stags would be few imo if they had considered that. In an up trending sector, sure, the stags would be all over this. I'm not sure many were though, it was too risky with the sector backdrop to stag an IPO profit.
The market today verified its listing price as fair and reasonable, and the promoters will earn their commission regardless.
On Monday the company is listed alongside the others. From here on the market determines the company value.
My view is that in the short term at least, they will suffer the downdraft associated with the sector, the SP will move with it and the investors who have done their homework will flick out on a slightest move southwards and buy back in later.
Personally I think it's at fair value on the information provided but as some suggest that information may be overly optimistic. Seems a risky play until it settles in to a rhythm.
I am quite shocked OCA didn't do better on the first day, apparent huge demand, only listing this year, attractive long term sector tailwinds... how could it not finish up at least on the first day?! But I do agree with the above... I think the general concerns around the entire sector were realized for OCA on Friday... almost reminds me of exactly what happened when ARV listed in December 2014... similar company (although OCA is much bigger, and has a much bigger development pipeline) and went up a fraction, before finishing at listing price... then trended downward as the market struggled to price it (believe the story), before a huge re-rating caused it to be the best performer on the stock exchange by a blue mile (last year)
I believe it is trading a fair bit below 'fair value' , however the market has clearly decided OCA's forecasts are overly optimistic, and skeptical why it took nearly 3 years to bring it to market ... time will tell if these concerns are warranted. Oceania’s has been owned for the past 12 years through Macquarie Infrastructure and Real Assets’ managed funds, not exactly a PE Feltex, DSE or TGH quick pump and dump (no articles before, during and after the offer closed saying how great demand has been, and how easy the shares have been to sell were also not present as per typical PE listing). Perhaps some have forgotten SUM was also PE?
Maybe the market also has concerns on this (like they did with all the supposed accounting issues ARV would have?). Perhaps, ironically, even if it missed it by a mile and had no growth from 2017 to 2018, it would still be the cheapest retirement play on an underlying basis!
(would it be bold for me to say I thin they will exceed FY18 guidance?)
Early next week we could see a hangover from the stags who thought they could make a tidy double digit percentage gain on the first day, now not interested in holding any longer and will sell at (nearly) any price, but once thing settle down (and broker reports come out?) we could see an uplift in price, the price moving no where, or perhaps it even trending down due to negative sector tail winds... so who really knows... again, time will tell.
Disclosure: Brought some at 82 cents, under 10 PE if they hit FY18 targets