looks like a meaningful breakout to me
Attachment 12433
Printable View
looks like a meaningful breakout to me
Attachment 12433
Very Nice graph.
If the 10 year increases to 2% and above then there might be another sell off.
Sell Off?.. BUY Friday there on the NZX.
Is Mr B a Buyer?
With competition for land in the next decade at the intersection of transport, housing and agriculture; will land values continue to rise and the NTA of the likes of GMT, ARG and KPG continue to increase.
Mr B will not doubt be pleased with his portfolio additions performance today.
My fellow directors would be very pleased im sure if a trade for ARG went through at 50 dollars.
Very solid result and nice dividend lift for FY22. NTA up very strongly. Net distributable income up 13% WOW !! (although was assisted with one-off gain on Albany of $4.5m but nonetheless a very strong gain). Net distributable income per share up 13.1%; WOW.
Most of all, we remain focused on growing sustainable distributions to shareholders in line with our company purpose."
Note to other CEO's...this is what shareholders really want to read and is a very refreshing change from the almost endless rantings of some other companies about diversity and inclusion, cultural sensitivity and all sorts of other politically correct nonsense.
Lot to like...I will look for opportunities to buy significantly more at or slightly below NTA which is now $1.53. I will strongly back companies that haven't forgotten their primary purpose for existence, that are managed very well and are on compelling metrics.
http://nzx-prod-s7fsd7f98s.s3-websit...406/346272.pdf
yes I really like that they highlight distributable income.
while property reval gains mostly come , sometimes they go.
Wondering what thoughts are from folks closer to this than me for ARG and other commercial property suppliers for the long term? Many businesses looking to downsize their office space requirements with more WFH now being the norm. Possibly oversupply in future?
I see a culture change where anyone who is in disagreement seems to become 'the accused' and it not only stifles healthy debate it's darn right abusive if you have the power of thought. I use every bit of information you provide in my own way. What good is a dog without a bark :t_up:
what is known will already be priced in.... hence trading around NTA but...
ARG have a diverse portfolio.
Attachment 12519
Take a read of the Annual Report released today
Reading the annual report, word of the day is Green
Window dressing in green is great ! It's very much "on trend" and keep's the politically correct leaders of corporations happy and feeling they're making a contribution to the environment and it keeps the eps growing...Win-win !
Oh gees...next you will be spinning out the virtues of eating tofu and taxing animals for f#rting! Hehe..
Good solid if not spectacular result..steady and can I say slightly boring result..always good to have some boring stocks...
Happy holder..haven't added any for a while..to be honest have found the whole market a little boring lately apart from the ATM destruction...
You must be psychic mate. How on earth did you know I've been trying out Hansells Laksa soup with tofu in it :D https://foodwatch.com.au/reviews/ite...r%20and%20stir.
Its actually very good and tasty on a cold autumn day and definitly not boring :D
As you quite rightly suggest, boring stocks can be a very good thing, certainly better to hold that the exciting ones that are a drama a minute like ATM :eek2:
I guess the market found it a little too boring, pulling back most of yesterday's gains.
Jenny Ruth in her piece at Businessdesk with headline Argosy goes for growth, but what about earnings? doesn’t seem on same page as you
Last bit -
All of this is cold comfort to investors wondering how Argosy is going to perform over the next 10 years and whether chasing portfolio size is an appropriate goal to set.
I'm comfortable with their management, governance and future strategy. You know me and my emphasis on track record and the five year summary of a company is one of my most favored parts of the annual report of any company as it gives such a useful snapshot of their track record. http://nzx-prod-s7fsd7f98s.s3-websit...406/346284.pdf
In my opinion page 8 speaks for itself with distributable income steadily rising from 6.55 cps in 2017 to 8.14 cps in 2021, albeit the latter figure augmented by the $4.5m Albany settlement but nevertheless a nice solid average annual increase of about 4% per annum.
NTA has steadily increased from $1.06 in 2017 to $1.53 in 2021. Good solid, dependable, albeit a bit boring, stuff and all the way along the journey decent quarterly tax paid PIE dividends.
I feel quite content with a decent chunk of these in my portfolio.
Risks are the rising 10 year Govt stock rate and the work from home trend, (although I can't help wondering how long employers are going to trust the employees will be just as productive working from home as whilst there is some initial novelty to this its very easy to let work efforts slip when working from home).
Forecast dividend is 6.55 cps per annum so on a $1.50 share price that's 4.37% net yield which for many investors on a 33% tax rate = 6.52% gross.
Its up to people to decide for themselves if the Argosy team can continue to perform well going forward in a possible higher interest rate environment, for me I think their track record is quite satisfactory and I am not concerned if Jenny Ruth sees it differently.
my feeling from the article was that they just didn't want to put a number on it. would it be fair to say that to infer anything more than that (i.e. the actual number themselves) is speculation.
blow off top 168...
probably the top for a while.
They really should increase the Div next year.
New all time high. The board are focused on steady dividend increases over the years and FY22 is up 1.6% of FY21. Last year they only paid out 89% of AFFO earnings so there is plenty of scope for many more years of dividend increases on top of the steady increases in the last 5 years....which is a vastly different situation from that prevailing at KPG.
My rating HHH (Happy Hound Holder).
Just dont have enough of them... got lots... should have got far too many..
bought them in half of all entities with trading accounts..
think we will have to buy it into every entity portfolio.
ARG is an investment; KPG has always been a trade.
hopefully KPG will take notice and get its act together. ARG has been a stand out performer.
Annual Results Presentation (nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com)
heading to 2 dollars in 2 years?
1.72, new all time high .
Mr B is Best Buyer Again.
It should pause here, should... but this market has been brought forward a long way.
P/E for this sector is not high because they are not considered growth stocks but bond proxies.
Another nice rise to another all time high and again, on very strong volume.
GMT and ARG appear to be the favoured Comp Props at the moment. Retail is lagging badly including KPG and PCT. The later may start to pick up next year.
Heres why the price has increases - moving into index, can anyone with a full copy of this article please copy here or send me via message.
https://www.nzherald.co.nz/business/...DKA7JHEEQBLKA/
Tip: you can save premium articles into a service like Instapaper and it will show you the full text.
I’ve copied the relevant parts here:
Property companies Argosy, Stride and Vital Healthcare lit up the New Zealand sharemarket on the promise that they may be included in the main global real estate index.
Stride and Argosy both hit new highs as the S&P/NZX 50 Index closed the week at 12,711.84, up 28.2 points of 0.22 per cent. There were 70 gainers and 58 decliners over the whole market on volume of 49.3 million share transactions worth $187 million.
Stride rose 9c or 3.66 per cent to $2.55; Argosy was up 5c or 3.07 per cent to $1.68; and Vital Healthcare increased 13c or 4.10 per cent to $3.30 on news that the FTSE EPRA/Nareit Global Real Estate Index was lowering its criteria for inclusion.
It is a market capitalisation-weighted index designed to track the performance of listed property companies in both developed and emerging countries worldwide. The constituents are admitted on liquidity, size and revenue.
Matt Goodson, managing director of Salt Funds Management, said the price movements of the property companies illustrate the sheer size of investing by passive funds in this current market.
Argosy has increased 27c this week; Vital Healthcare, nearing its high of $3.37 set on January 25, rose 26c; and Stride was up 19c – all in the range of increasing nearly 10 per cent.
Goodson said "we won't know till the start of September which stocks are going into the index but Argosy, Stride and Vital Healthcare could well join Kiwi Property, Precinct Properties and Goodman Property Trust, which are already there."
Based on current share prices, the passive investment funds may end up buying the local property stocks well above their fundamentals and net asset backing – just as they did early in the year with Contact Energy and Meridian.
"The lesson from that are the funds ended up with a nose bleed when Contact and Meridian's prices peaked and are now trading at their fundamentals," Goodson said.
thankyou Kelvin
Thanks guys, I missed that. Hmmmm...more upside in Sept ?
Maybe ... however - I see this more as a potential feast for the traders.
Have a look what happened to our Gentailers (here MEL, but the others look similar) earlier this year when the international clean energy ETF's bought in.
Attachment 12721Attachment 12721
A peak like the Matterhorn. Great buying for anybody who got in early and got our early ... but dangerous to buy late and hang around when the music stops.
What do I want to say? Not sure ARG's price is currently driven by fundamentals :): Given that interest rates are more likely to go up from here, I would expect them to drop over time.
Maybe ... however - I see this more as a potential feast for the traders.
Have a look what happened to our Gentailers (here MEL, but the others look similar) earlier this year when the international clean energy ETF's bought in.
Attachment 12721
A peak like the Matterhorn. Great buying for anybody who got in early and got out early ... but dangerous to buy late and hang around when the music stops.
What do I want to say? Not sure ARG's price is currently driven by fundamentals :): Given that interest rates are more likely to go up from here, I would expect ARG (and other property funds) to drop over time.
I believe you've missed the fact that they have a solid record of driving real rent increases and eps growth. Also the valuers cap rates at 31 March 2021 don;t look too demanding to me.
Had these for quite some time and I'm a very happy camper...wouldn't mind a few more.
Go for it ....
I just see them as quite reliable cyclicals .... and for that they are currently for my taste a bit too high in the upper quartile .... but hey - I don't win every time :):
Remember though: Higher interest rates (if they come) means - ARG will have to pay more interest as well and anybody buying the shares will compare their return with bonds (which would then rise in interest rates as well). Double whammy!
But how do they say: This time will be different!
... and I guess for traders its just back to climbing the Matterhorn ... lots of opportunities (and risks) ...
Go for it ....
I just see them as quite reliable cyclicals .... and for that they are currently for my taste a bit too high in the upper quartile .... but hey - I don't win every time :):
Remember though: Higher interest rates (if they come) means - ARG will have to pay more interest as well and anybody buying the shares will compare their return with bonds (which would then rise in interest rates as well). Double whammy!
But how do they say: This time will be different!
... and I guess for traders its just back to climbing the Matterhorn ... lots of opportunities (and risks) ...
I suspect interest rates are going to be "lower for longer" which will be very supportive of this sector https://www.cnbc.com/2021/07/06/us-b...d-minutes.html
I sold 100k at $1.71 yesterday via my trading account, with the intention of buying back later. It took all day - one trade, with the longest "history" list schedule of my career at completion. My view is they have too significantly overrun NTA currently, and that higher interest rates are coming sooner rather than later with negative connotations for property shares. They were $1.435 on 1 April. We shall have to wait and see how it is.
Yes they are ahead of there NTA but as dividends increase over time they will pull away from higher interest rates. Look back at Comp Prop share prices in 2007 and 2008.
ARG and GMT will continue to expand there book and as technology continues to push out deflation over the long term.
Certainly the chart for ARG and GMT says sell some down but the US 10 year has been smashed down in the last month.
You got possible flash crashes coming from shadow banking via block chain solutions and those could give you some unexpected buying options via credit events on global markets.
Since when have markets been stable and plain sailing.
Average portfolio cap rate as at 31 March 2021 was 5.63% with a WALT of 5.5 years.
Try buying commercial property with a >5% yield and a decent tenant(s). Almost impossible to find. My view is the portfolio cap rate has the potential to come in lower as a whopping 49% of their portfolio is the highly favored Industrial category. I'm also confident they will add value with their excellent property management skills and property developments and continue to grow eps.
I'm quite relaxed at these being a bit over NTA.
From goodreturns
Analysts at Forsyth Barr warned Argosy Property and Stride Property were now “fairly priced” and downgraded them from ‘outperform’ to ‘neutral’.
There are economic growth concerns as a result of the rise in Delta variant infections. (There has also been a concern at the number of infections in fully vaccinated people.) That may well have a dampening effect on interest rates.
https://www.nasdaq.com/articles/dail...ies-2021-07-08
Fair enough and I remain very comfortable holding. That's an early morning post for a young fella like you :)
Bjauck - Yes the US 10 year is back under 1.3%. Pyzier working on a booster shot for Delta variant (but how long to get that distributed throughout the world ?), but there's other variants and I think we are going to be playing cat and mouse with this virus for many, many years.
Close at $1.62 today. As suggested only 10 days ago, price was primed to fall from $1.71 and that thesis has played out rather quickly. Hopefully will stabilise now as I couldn't resist reacquiring. Yield just about back to 4% - will it be enough?
what goes up vertical, usually comes down, If you wanted to take profits 1.70 was the time and got there a lot sooner than expected.. Just shows what happens when money moves around.
You will see the same thing sometimes in GMT when a flood of buying occurs and then it drops back.
Its just money moving around the market.
Also CPI was out today and that could trigger a lot more selling before it rebuilds momentum.
If the OCR moves up in august that will trigger another round of selling.
The key is that its 4% net in the hand as its a PIE fund. I still see plenty of non listed property investment opportunities being advertised at 5% gross, which more many is 3.35% net and that's with your investment concentrated in one or just a few properties. 4% net is 6% gross for anyone paying 33% tax and they have an excellent track record of growing dividends.
good commercial land in central, regional and south auckland is surely going to be harder and harder to find..
IE.. implied without having to state this ... NTA is always OOD (out of date).
Yeah the 28% PIE structure is very attractive indeed for those paying 39%. Also attractive for huge numbers of investors paying 33%.
I'm not too worried if ARG falls a bit more as I'd quite like to add to my holding.
I suspect that there are a whole bunch of people with financial planners and advisers who have skewed their asset allocation away from fixed interest into yield shares over the past wee while.
Bond proxies, if you will.
With talk of inflation and rising interest rates, I suspect that they are holding off the share market until there's a little more clarity around the future direction of interest rates.
So property, electricity,, and so on are likely to be static or declining, pricewise.
US10 year dropping..so much for pressure and it hitting 2 ..
US 10 year dropping again.. good news for COMP Props and ARG.
10 yr hits 2-3 and above it will be to late to dump the local COMP PROPS.
pretty sure MR B knows full well the impact a high 10 year has on the Bond Proxies and VAN G recently sold down some of it NZ positions.
I wouldn't mind some more Argosy. Mid - late 150's would see me dipping into my cash pile.
"late 150's would see me dipping into my cash pile."
BBB+ Rated by MR B...
whatch that 10 Yr
bps , Net Yield.
NZ , YTD 72.46
No chance of mid 1.50 at the moment ... strong demand from retail investors.
Yeah, new all time closing high today on much higher than normal volume (~ 3.5m shares). If my memory serves me correctly a while back there was some talk of ARG being included in some new overseas fund. Forgive me I cannot recall the details and am not sure if its met the criteria for inclusion or not but based on the volume and share price, perhaps it has and some investors are getting themselves positioned early ?
If so, my understanding is the rebalancing occurs at the close of trade on 17 September. Maybe something to watch for...
Disc: Happy holder.
world real estate index, I'm not sure how you find out if they have been added?
https://research.ftserussell.com/pro...143.1630912382
Might be this one and some institutions might be front running the changes that come into effect at close of trade 17 September.
Can't access the attachments to confirm one way or the other if ARG has been included, sorry, (have tried registering twice).
Volume and price action today does tend to support the contention the odds they have been included are pretty good and if so the 15 minute price match process at the close of trade on 17 Sept might be "interesting".
Herald reported this Saturday
Argosy increased 3.5c or 2.12 per cent to $1.685 and Stride Property also gained 2c to $2.70 on the news they will be included in the FTSE EPRA Nareit Global Real Estate Index on September 17. Stride is also being included in the FTSE Global Small Cap Index.
Vital Healthcare Property Trust missed out on the real estate index and fell 15c or 4.53 per cent on Thursday, though it recovered 2c to $3.18.
Interesting from BusinessDesk
When Jarden’s research updated its forecast for property investor Argosy this morning, they noted higher market rates would hold back earnings growth “Our nearer-term forecasts and valuation are largely unchanged, with the increasing interest rate outlook dampening the earnings trajectory somewhat,” they wrote. Argosy Property finished the day with its share price unchanged at $1.63, today.
The rate hikes might dent the NPAT but really these guys are not heavily geared. Organisations desperate to get people back to the office to create that sparking cultural vibe that you cant do over Zoom.
Wont impact the bottom line to much and where else are they going to invest but shares? Commercial property in the central north island is at a premium.
Yes I agree. I trimmed down a little the other day but am very reluctant to sell more as I am sitting on a cash allocation at present that's uncomfortably high as I struggle to find compelling value in the market.
This provides a net PIE yield of 4% which for many is the same as 6% gross. A lot of commercial property is now selling on a yield of only ~ 4% gross before expenses.
"trimmed down a little "
170 was a tempting sell , and then trade the Divs but a very difficult decision to make.
Surprised the SP has held up but like GMT quality stocks like these would only move back to 1.20-30 (GMT 1.90) if the 10 year spiked fast to 3.5 and some CNBC commentators are surprised it hasnt already but one Fed in the US has their model pointing to lower inflation.
Could be a bit of a top here for a while.
But dont forget to read the presentation ..
Annual Results Presentation (nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com)
Closed today at a low of $1.50, not seen for a few months. It doesn't seem too long ago that I sold 100k at $1.71 but just a drop in the ocean as ( disclosure ) like Beagle I hold heaps. Wish I had been more decisive but hindsight is a wonderful thing.
Half year results ( to 30 September ) are due for release on Tuesday 23 November. NTA per share at 31 March was $1.43 and it is clear a price in the $1.70's had overrun any uplift in valuation subsequently, but perhaps it is not unreasonable to expect that in the 6 months comprising the half-year values are now a bit ( may be 10c or so ) above the $1.50 mark as the major valuation firms were still cautious at y/e.
PIE yield is about 4.4% presently which is ok . The effect of Covid on occupancy for other than small retail ( not much, if any, of that in the ARG portfolio ) will rapidly transfer to the rear view mirror so ARG could be a good buy at current level.
if rate go higher and expected to top out at 3 % the big gains wont kick in until Net Yield can pound the expected rate rises..
1.40 would be a good buy. But since people are still desperate for yield and the rate hikes havnt kick in yet 1.40 might not be here this year.
They will have to increase the yield to hold the selling at bay.
Just to clarify, NTA as at 31 March was $1.53 which is close to what the VWAP was today. About half the portfolio is industrial which is very much in favour and saw a big valuation leap for GMT in their recent half year report. I therefore expect the NTA in the pending report to be somewhere around or close too $1.60 as at 30 September 2021.
ARG has a long and highly credible history of being able to conduct rent reviews than give meaningful increases in income, (unlike KPG).
The current PIE yield is 4.367% and is okay and better than you'd get on most direct property investment with modest gearing. I let a few go in the low 160's. I am happy to hold the rest. I am happy with the caliber of the management team and board and the results they're achieving. I think they go about things in a prudent and highly professional way.http://nzx-prod-s7fsd7f98s.s3-websit...731/349146.pdf
Its been a bit of a frustrating year with NZX50 inclusive of all dividends paid during the year ostensibly giving no return year to date whatsoever and unlikely to give much if anything for the whole year in my opinion. This will mark it out as the worst performance on the NZX50 in a decade.
Unfortunately ARG have performed in line with the market this year.
" they go about things in a prudent and highly professional"
outperforming!
But the question is will the country outperform to keep those valuations going.
Yes agricultural exports are critical and with FFFF in charge of import immigration for get critical needed investment and brain power into the country getting a 4/10 mark today you have to question where NZ can outperform.
Are NZ's golden days in the balance?
Picking a stock just on it performance without Macro context is saying a stock is operating in its own economic space.
ARG is protected to a large degree and it should not be as hard hit as KPG if there is cyclical movement in the economy.
There will be reduced land for high quality commercial property as housing competes with commercial. Next 24 months will be challenging for Yields as rates jump higher.
Note: FFFF stands for FATY FAAFOI FROM FIJI..
probably from south auckland, SA, who know but a satirist would have a field day. Anyway he got a 4 today as being AWOL by the journos.
actually the great MP JGB would have taken the whole lot back stage by now.
Both now playing on the great stage in the sky replaced by people basically just swearing for a living.:sleep:
Bagrie says it best in the Herald today.
"The Government has done really well supporting the economy by running expansionary fiscal policy and spending money.
"But that sugar candy economics does not deliver an enduring economic base wellbeing is dependent upon," he said."
The immigration report is out from the commission and it also help get a sense of where the demand is going to be with Australia needing a lot of talent to get itself up and running again.
NZ will no doubt suffer the same problems.
"The lucky country’s much-lauded infrastructure pipeline has been thrown into disarray by Covid-19 border restrictions. By mid-2023 Australia will likely be short of people for 105,000 positions needed to keep the pipeline on track: 70,000 engineers, scientists and architects, 15,000 structural and civil trades, and 19,000 project management professionals."
It is one of these things ... Maybe, maybe not ... much easier to see with hindsight :);
From a personal view - I just don't hope that interest rates stopped their climb already. If they did, than what ammunition will the reserve banks have when the next crash comes (and it will)?
So - I hope interest rates have a chance to climb a bit further (which would be however a temporary break on the likes of ARG), but hey - my crystal ball is cloudy as yours ...
Great buy if the yield curve hits this stock.. Waiting to buy more well below NTA but that my be wishful thinking.
Rates never go above the previous high of the last cycle. Always trend down over the long term.
However plenty more to go, mortgage rates only got down to 2.19% got to get to zero before there’s no more room to go, so negative OCR next time.
After that there is always universal basic income provided by the govt and funded by the central banks.
All good, we can kick this can down the road for awhile yet 🙃
[QUOTE=Rawz;923759]Rates never go above the previous high of the last cycle. Always trend down over the long term.
That’s probably what most people thought in the late 1960s after 20 years of post war low interest rates. Didn’t stop the 15-20% years of the 1970s and 1980s though.
To be clear I have no idea but I personally would t be too cocky about the future!
low 1.40's coming up in the next 6 to 12 months unless yield goes up... it will be a big BUY AGAIN!
Agreed. All commercial leases I have ever seen have annual or bi annual minimum rent review clauses that rent will increase by XYZ% or CPI whichever is the greater and CPI will be the greater amount so rents will be going up a lot in FY23. REIT's are a great place to hide in an inflationary environment because of this.
Hoping some money panics and leaves NZX over next 12 months giving some farther buying opportunities in this sector.
No matter what the National Debt is commercial property will still be in demand.
And with people asking for more LEVEL3 or more pick your color of red debt will continue to grow..
But as all NZ knows there is limited land in small thin islands..
This is something that has been weighing on my mind heavily for the last 12 months. It seems that I want to be in cash to take advantage of another crash in whatever (or everything) but, at the same time, I don't like the loss in purchasing power caused by that fat son of a fraudster.
Other suggestions put forward are precious metals and commodity stocks, but these seem to have inflation priced in already, and I think I might have missed that boat. Also, without exposing myself to Cullen's envy tax, there are not a lot of options for both if I want to keep the money in NZ and not get stung with FIF.
Thoughts?
Nobody can time the market so you should stay fully invested all the time and only keep what you need for an emergency as cash on the sidelines. If you must, use margin lending during the crashes to maximize the rebound.
However in saying that I read Warren Buffett has the most cash on the sidelines ever right now hmmmm
GMT out today with DIV and Market results... ARG might be a BUY here also at these prices.
yeah that is how I typically operate, but have moved to heavy weight in cash outside of the market so I can move quickly if I see opportunity.
Very liquid REITs are one thing I have tried so that I can avoid the inflation monster
What are your thoughts on other options should I explore?
Personally, I've hated cash laying around ever since Key sold us out to the bankers with the OBR. But as this is the means of exchange, and the only way I can see to trade shares, well, means must. At least with assets you can swap without the gummint knowing about it.
GMT comments on market results..
"Supported by a rapidly growing digital economy and other structural changes,
demand for distribution space close to consumers is exceeding supply in many
locations across the city."
Rent increases as MR B suggested.
"The increased demand is also contributing to
significant growth in rental income, with 5.1% average annual growth on a
like-for-like basis."
ARG will also benefit from this and well constructed safe office space in the future that has health safety as a primary factor.
wow, the 6 month chart doesn't look healthy at all.
What's going on with these guys? Falling out of favour?
I'm not sure it is that simple...
Asset plus - fairly flat
Goodmans - middling but flattening out
Investore - slow decline
Precinct - looks like Argosy
Property for industry - distinct decline
Stride - just as bad as Argosy
I realise they have different property class exposure
It also seems odd that folks would pull out of property given the inflation fears. I mean, if you are looking at bonds for "risk free" return, then you are definitely going to lose these days.