Originally Posted by
Beagle
You've tried to pick some arbitrary period of time to suit your own thesis. Winner and I called RYM significantly overpriced relative to its peer in early 2014 and warned of a protracted period of underperformance relative to the only other sector player at the time which was SUM. Since then I have repeated my view over the years several times.
RYM share price on 31 March 2014 was $8.75 and its is now $9.76 a capital gain of only 11.5% in eight years in a rampant bull market for housing, enough for anyone to tear their hair out in frustration.
As expected and foretold this has dramatically underperformed SUM in those eight years which has risen from $3.59 to $11.55, more than tripling its share price.
This is a great example of people simply paying too high a multiple for RYM because of former market darling status and what happens to your returns afterwards over a long period of time. This also has the very real potential to turn into a full decade of underperformance for RYM in my opinion.
To be clear folks, I am not valuing FPH at $15...I am simply stating that this downtrend has real legs and momentum and its very dangerous to apply new capital in a steep downturn without any TA signals confirming a bottom is in. I'm also stating that I think the market darling status with the PE is very much alive and well still with FPH and we have all seen what happens when companies lose market darling status...another great recent example is ATM.
Obviously, Iceman, Covid has provided headwinds for some companies and tailwinds for others and comparing the two is about as helpful as comparing the price of apples and pears but for what its worth I backed the truck up on OCA right after the lockdown started at about 70 cents so its still up 50% from then.