Thx Waiken for the Forsyth Barr review.
Confirms this stock is a hold. I thought SP would be around recommend target price now. Maybe price will left running up to dividend X date 9 Feb.
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Thx Waiken for the Forsyth Barr review.
Confirms this stock is a hold. I thought SP would be around recommend target price now. Maybe price will left running up to dividend X date 9 Feb.
Back to 150 and onwards and upwards if brokers think like they are
This time we may never see the 140s or less again
Can't have too many Oceania ...or something like that
Should I be worried that ForBar and I have near identical thoughts and target price? :eek2:
resistance has become support
Attachment 12252
i dont need to mark it do I?
No you dont! need to mark it. Has FB got it right for once. Better not comment on that one.
That is the kind of info we are waiting for.
DISC: yes we have access to the docs.
Some quick thoughts on the H1 result - in no particular order:
- Development
- Pipeline remains strong with 5-6 years of brownfield development based on current freehold land holding
- Brownfield developments to be completed in FY22/FY23 (ie: next 1-2 years) would appear to be ones with potential for a high development margin, given both location and premise type
- Auckland: 49 apartments (Eden), 113 Care Suites (Lady Allum) [FY22], 79 luxury apartments (St Helliers) [FY23]
- Tauranga: 39 apartments (Bay View) [FY22]
- As has been noted previously by others, large portion of this is already consented. Clearly good for progressing with development, also likely provides some hidden value in land on balance sheet as more value in consented freehold land
- Shorter term, appears development pipeline for FY21 weighted towards H2 (89 units + care suites H1, 128 to complete in H2)
- Change in % of care suites : care beds and move towards premium offering is on strategy. Nov-2018 care suites made up 17% of care facilities, whereas Nov-2020 suites make up 30%
- Trading and Cashflow
- Sales volumes artificially high due to COVID bounce back post first lockdown, however also impacted by AKL second lockdown in August
- Impressed by increase in operating cashflow, which continues to comfortably cover dividend payment
- Increase in care profitability very encouraging as (1) OCA clearly state that this is the core component of their offering, and (2) likely reflects the increase in premium care suites coming online (eg: The Sands, Meadow Bank), linked in with inflection point reasoning that has been mentioned on here a number of times. Not. necessarily there yet, but above is early evidence.
- Linked to care profitability, like the sustainability of income that comes from having ORA and DMF arrangements on premium care suites. Effectively the same as having an income hedge over the life of an occupation, as opposed to replying on development margins and churn.
- Think generally exec and directors have done a better job of explaining this strategy in laymans terms in the current report.
- Balance Sheet
- Given ramping up of developments and pipeline, impressed at reduction of net bank debt by $12m (ex. bond issuance), with bond issuance also providing diversity of funding and certainty of tenor.
- Interest rates on bank debt also attractive, evidently BKBM priced, and given how sharp they are would suggest Bank risk models are also happy with OCA position
- No other significant changes to note. Change in FMV of fixed asset book already discussed so no need to touch on.
Think in current market the expectation from some is for a stock to double, triple or more in market cap - often not based on fundamentals.
Wouldn't get too focused on - for example - a relatively insignificant drop in development margin when recognising that results show OCA is executing on strategy and knowing that will take some time.
Clearly a hold for me.
Earl told analysts the housing market is "defying logic," making it difficult to forecast his company's results.....but he seems really upbeat about the remaining 4 months of financial year ...almost hinted surprisingly good.
Good ol’ Earl