Well, someone senses a bargain at these levels and are accumulating quietly...
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Well, someone senses a bargain at these levels and are accumulating quietly...
To be honest mate that's not how I see it or read the chart. Any support is pretty much just getting smashed. Now broken through 200 day moving average so technically also looking very vulnerable.
Recent SP declines prove that the companies ability to achieve FY15 projected profit isn't what people are focusing on...its the effect the headwinds may have on FY16 and FY17 that's occupying the minds of investors.
Most great companies face head winds at some time or another,yet great management see them as opportunities.I am thinking of companies such as EBO,FRE,IFT,MFT,POT and RYM.I see Heartland too looking for opportunities. The more headwinds, the more opportunities for a niche player.Heartland are "well positioned."
I actually think Heartland were the savvy ones, buying the REL business from Quadrant.
I don't think anyone disagrees Roger that dairy farmers are facing a tough time. For how long we don't know. It doesn't translate into all of them defaulting on their liabilities. I had a beer with a couple of dairy farmers in the Waikato on Friday. They both told me they can see this and 2-3 more years possibly very tough. But they also told me that the last couple of years have been the best years they've had since they started farming (both 20+ years) and they've used them to prepare for the inevitable leaner years. No doubt those that have bought into the industry in the last few years and are highly geared will find it much tougher though.
Absolutely agree with what you've said mate and never meant to imply that any sort of majority in the industry will be in trouble. The majority of dairy farmers who've been in the industry for a long time and have little or no debt have seen the cycles come and go and will have stored away plenty of reserves in the last year or two to cover the lean times. On the other hand those relatively new to the industry including many dairy conversions done on 100% debt in recent years and including the sharemilkers HNZ are lending too based on the value of their herd only will be doing it really, really tough, especially the latter who have to survive on only 50% of Fonterra's pay-out and service their debt. Sharemilkers have no real ability to manipulate their cash flow like most farmers by deferring maintenance on fencing, roads and tracks and such like. How long is a bit of string in terms of this dairy decline ?...who knows but I'll bet you a couple of beers there's a few miners in Aussie who figured base metal prices would have recovered by now.
ANZ up 2% and HNZ down 3% odd ---- go figure
Oh I forgot its just noise
But a lot of noise lately - wiping $120 million of the market cap in a few months .....heck that's a lot