TRA - Turners Automotive Group

[Basil]

My view is the synopsis shared by Shareguy above and valuation is very sound.
Disc: Moderate sized position.

[Clearasmud]

My view is the synopsis shared by Shareguy above and valuation is very sound.
Disc: Moderate sized position.

Couldn't agree more.
I just bought a car at Turners Wellington via auction.
It was a pleasure dealing with them!
Nothing sleazy about them.
I spent my last dividend on a cheap car lol.

[Whome]

TRA showing good gains in recent days. Now above MA50. It needed to get off the mat. At $3.45 now on a Yield 6.7% on PE ~9.5

[BlackPeter]

Not too bad, but compare that to e.g. FBU (@$4.88) with a dividend yield of 8.6% and a PE of 8.9.

But I recon they will need both- FBU to fix the houses and infrastructure and TRA to replace the cars ...

 

[Basil]

TRA showing good gains in recent days. Now above MA50. It needed to get off the mat. At $3.45 now on a Yield 6.7% on PE ~9.5

You know you want back on "the bus" mate.  That yield you mentioned is fully imputed so the gross yield is 9.26%.  Lot of cars to be replaced with the extraordinary weather events.  Mrs Hounds is hopefully one of them.

[Whome]

Basil, you mean back on a bus from Turners and doing a little dance with Tina at the thought of that juicy divi. Still have a smallish stake in TNR. No spare funds at present - mainly with a certain clothing company.

[Onemootpoint]

A warning to make informed decisions...

"Between 1 and 22 February, 524 vehicles were added to the register as write-offs with the water damage annotation." 

https://www.interest.co.nz/business/120046/review-things-you-need-know-you-sign-thursday-only-minor-retail-rate-changes-today

https://www.nzta.govt.nz/vehicles/choosing-the-right-vehicle/recalls-and-damaged-vehicles/written-off-and-damaged-vehicles?start=24420

[Waltzing]

10,000 CARS!!!

https://www.stuff.co.nz/business/131325980/more-than-10000-flooddamaged-cars-will-be-written-off-by-insurers

[Onemootpoint]

At least the media appear to be putting the word out to consumers on the issue:

https://www.stuff.co.nz/motoring/131351676/toyota-issues-warning-be-extra-careful-with-used-cars-after-floods

[Onemootpoint]

Interestingly TRA not feeling the love today. Down nearly 2% at the time of writing this. Perhaps the market (momentarily) considers the positive spin around NZA as stronger competition for TRA going forward. Not that it should.

[Basil]

10,000 CARS!!!

https://www.stuff.co.nz/business/131325980/more-than-10000-flooddamaged-cars-will-be-written-off-by-insurers

10001 cars now...Mrs hounds car written off. Going to be a lot of insurance money chasing cars.

[Waltzing]

That more Cars than Tina can shout out in an ADvert...

Cars, Cars, Cars ..... doesnt cover it!!!!

Gosh some parts of the NZ look like sub continent flood plan...

[winner (n)]

ITS GOING TO BE A RECORD YEAR

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/TRA/407909/390200.pdf

[Basil]

Very encouraging trading update.
Taking into account the known headwinds regarding Omricon trading in the first quarter, serious cost of living pressures in the economy all year and especially significantly increased interest costs from funding previous fixed rate motor vehicle lending with floating rate debt, this is a highly credible result as we arguably scrape across the bottom of the economic cycle.

More encouragingly, I noted this snippet about how they expect margins to move in the future
Replacement demand for damaged cars, combined with the supply restrictions caused by the
Clean Car Standard is expected to be inflationary for used vehicle pricing and margins. 

It's clear their branch expansion strategy is working very well indeed leading to increasing market share gains.

Quick look at the metrics of this company which in my opinion has now proven its capable of steady growth in the years ahead.
FY23 forecast (assumes if they have the confidence to say profit will be at least $44 before tax), $45m before tax = $32,4m after tax = eps of 37.4cps.
Current year PE $3.38 / 0.374 = 9
Gross yield 23 / 0.72 = 31.94 cps / 338 = 9.4%

I note last year they paid a Q3 dividend of 6 cps fully imputed with a record date of 7 April.
Credit where its due, they've come a long way with developing and refining their business and lending model in recent years.  More importantly, it's clear their business plan is scale-able right across the country.  Been a happy holder for quite some time now.

Opportunity knocks ? 

[Breezy]

Funny how times change, this stock used to be the biggest dog out according to the same people who now think its the bees knees, just goes to show that its best to ignore random barking because every dog really does have its day. Lol