Originally Posted by
Maverick
I`ve spent yesterday day going over ARV`s result and updating my spreadsheets. And magnificent spreadsheets they are too, predicting back in March (post above) that the EPS would be 9.3 cps.(maybe the broken clock thing)
Firstly, I am very impressed with the layout of the investor presentation . I have always bagged ARV for sub-par presentations but they have really got that sorted now.
Here goes.....
-They seem to be suffering the same phenomena as SUM of taking longer to sell the new stuff with only 46 of the 113 new units delivered FY19 being sold. Their new sales reduced from FY18 =79 to FY19=70. While SUM got canned for falling new sales recently we seem to be getting more accustomed now. I personally have no issue with this as it takes time for new builds to be digested by the community. The true indicator of oversupply (according to SUM CEO king Julian) is resales and ARV have good resales with only 2% being empty. SUM is 1.5% but it has gone lower to 1% at the time of their recent AGM , RYM 1%
-All their YOY figures seem healthy enough with no red flags that I can see. It is good to see their YOY DMF`s up 18 % and resales profit up 47%
-Their new build margins are way behind the others at 17% (SUM and OCA at circa 30-33%)
-To compare apples with apples I have added back the tax ARV pay as OCA, SUM and RYM seem to pay feck all tax. This increases ARV`s EPS to 10cps.
Sooo… EPS (untaxed) and PE as follows;
ARV $1.30 eps 10.0c = PE 13
OCA $1.04 eps 8.5c= PE 12.2 (this is 12 months old, FY ends this weekend- my spreadsheets are predicting eps 9.1eps =11.43)
SUM $5.55 eps 47c= PE 11.8
RYM $11.50 eps 45.4 = PE25.3
Seems to me SUM and OCA are ones offering best value with ARV a wee way behind in 3rd place. Plus I really like the OCA and SUM directors (I don`t know anything about ARV directors but probably outstanding individuals too).
Disc; hold truck loads of OCA, a van load of SUM and a lime scooter load of ARV.