Not convinced that in this particular case FuBar know what they are talking about :t_down:
That or they are downramping :p
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Not convinced that in this particular case FuBar know what they are talking about :t_down:
That or they are downramping :p
I think its well worth highlighting that HGH directors said yesterday they are ostensibly seeing no utilization of the Covid provisioning already provided for in FY20.
Forbar seem to have painted themselves into something of a corner here with their previous glum view and appear to be desperately trying to save face by doing a very slight upgrade to their forecast but at the same time reiterating their view that Covid provisioning is grossly inadequate. This seems incongruous with vaccine developments in recent weeks and the prospects of an economic recovery off the back of widespread vaccinations and reduced covid effect in early - mid 2021. I note for example a business confidence survey out yesterday saying business confidence had improved to the best level since Labour first got elected in 2017. That's an important lead indicator for how business's are feeling.
Who do you believe ? HGH directors working at the coal face of the business or Forbar's analyst who quickly and just to a minor extent tweaked their previously held glum view ?
My money is firmly on HGH directors with this one. I am on the same page as the Snow Leopard...should that worry me :eek2:
if your desperate and behind in your car payments you can either move to Aussi with a 2000 dollar incentive or pick kiwi fruit for a 1000 dollar incentive...
that should help anyone defaulting on there loans.
they are paying the locals to bring in the harvest... anyone thinking paintings of the harvest under the court of urbino, Count Montefeltro.
My money is firmly on HGH directors with this one. I am on the same page as the Snow Leopard...should that worry me :eek2:[/QUOTE]
To add to your worries I concur with the directors and both of you ....lol.
To add to your worries I concur with the directors and both of you ....lol.[/QUOTE]
I’m more bullish than both of you and what directors are saying (with a smirk on their face if you knew what I knew like)
Proactive provisioning and that bottom drawer trick ...Jeff a master at that
It was clear in the report yesterday that many of the loans that we were most worried about earlier in the year, cars and small businesses for example, did exactly the opposite of what we feared and have been repaid faster than what was expected. Much of it due to businesses taking advantage of interest free Government loans to pay up interest bearing loans with Heartland. This and the fact that they are limited in the dividends they can pay out, has left Heartland's coffers overflowing with cash.
Jeez ... when all the gurus agree - isn't this when one should run for the hills?
Anyway - topped up yesterday during the AGM, holding less cash should make it easier to run :):.
Time for a quick 'pit stop' at the four month mark, and a quick check on how my assumptions for FY2021 are tracking.
A trick to remember with Reverse Mortgages is that even with no new customers signed up in a year, the portfolio will still grow by 6.7%. Looked at in this light, the NZ portfolio is actually going backwards. Overall it looks like we are heading down my 'pessimistic scenario' road, which is disappointing.
Motor vehicle loans growing at 11.5%+ is way ahead of even my own optimistic scenario. However I always expected the first half to be much better than the second. That is because most of the Holden business I expect to be concluded in the first half. So I expect the full year result to drift back towards my optimistic scenario.
O4B and Harmoney are declining as I expected.
I was picking 'business intermediated lending' to fall by 10% when in fact it has grown by 13%. One interpretation of that is that third party funders are growing their businesses faster than Heartland who is supplying the capital for them to do their increased lending. The listed entity Zip (ZIP on the ASX) is one of those. The ZIP share price has tripled since Covid-19 lows, and is 50% above pre-covid levels. Meanwhile some of Heartland's other intermediated loan partners are vehicle distributors, which would tie in with motor vehicle loans performing much better than I expected.
The reduction in livestock lending on the books is seasonal, and so not reflective of what will happen in the full year. The reduction of 'Relationship Loans' (largely including rural?) I had budgeted for.
Overall I am a little concerned at how weak the Reverse Mortgage lending is compared to what I had thought. Although it may be true that this four month period has put many pensioners into a 'stunned mullet' trance, with normal reverse mortgage lending to resume shortly. It really is too early to make a good guess on the FY2021 year result. Despite the bolting motor vehicle loan portfolio in the year so far, I still think it could slow. I am happy to be able to have used the 'Covid panic' to get my HLG average entry price down to $1.30. In the process I boosted by HGH portfolio position from 'very underweight' to just 'slightly underweight'. With the share now trading at $1.47 I certainly won't be selling. But neither will I be chasing the price up further. There are still enough market risks around to keep me from further topping up at today's prices.
SNOOPY
I'm with Winner & a good number of you others here ..
Still filling up the truck with this one & plenty more spare space left for more ;)
IMO very very good value in a market where others have already risen, somewhat leaving HGH behind..
The believers may be well rewarded, perhaps in 2021..
Close over $1.50 today?
That's at least back to what it was early March
I see $2.20 coming soon
That'll be when real value investors will sell .... buy low (undervalued) sell high (when over valued)
Sound like me master winner..lol
Agree
I look at it this way - where can one 'Buy the Bank' @ 1.50 a shot for a good Div Paying stock that can only
see further increased DPS pay out - when banks are released from Govt imposed straight jackets ?
Compared to others - even non dividend paying companies at current levels suggests reasonable value IMO .. ;)
I have adapted my approach and will now buy up to an absolute maximum of 15% for very high conviction positions. If something then heads materially above 15% I rebalance after that on a case by case basis but generally won't allow anything to be more than 20% of my listed net worth.
I prefer to hold positions of 10% or less but if there's a decent size feed involved I am happy to back myself but set limits just in case I am wrong because...well, you don't know what you don't know. FWIW I am 11.5% in HGH at this point. I want more but would prefer to buy any more on a slight dip, (wish me luck with that, I think I might need it lol).
Typically excellent post from whom I consider to be the master of the sector.
Snoopy, regarding the reverse mortgage sector not performing to your expectations, could this just be the quiet before the storm, before this low interest rate environment means the oldies burn through their remaining liquid capital (stuff all interest in addition to reduced buying power), but enjoy the gains on their property value? How's the NIM likely to hold up in this part of the business?