TRA - Turners Automotive Group

[HAWKDOG]

yes of course fuel prices will eventually drop and people will drive what they can afford to drive.

TRA has not historically sold a lot of EVs - this will change as more used EVs come on the market.

As for covid - Aunty Cindy was far more generous than Nicola no ferries (could change) with helping joe public.

New car sales dropped about 30% during the GFC and took several years to recover.

a major oil price spike occurred immediately prior to the Global Financial Crisis (GFC). Oil prices reached a record high of over $145 a barrel in July 2008, driven by strong emerging market demand and speculation, before plunging in December 2008. This spike was a significant contributor to the severe economic pressures preceding the 2008 crash

Cash Dubai was assessed at a record $157.66 per barrel on Tuesday for May-loading �cargoes, S&P Global Platts said, surpassing Brent futures' all-time high of $147.50 in 2008.

[Basil]

Don't forget "Sindy" locked 1.8m Aucklanders down for months on end so they didn't need their cars and couldn't visit Turners car yards yet Turners still posted record profits in FY21, FY22 and so on.

Fair enough that those canny investors who backed up the truck at $3.50 less than 3 years ago take some chips off the table, as I have done and my remaining shsres, which is still a large holding are free carry but it's a big call selling them all as you've done. I'm not doing that.

[Dolcile]

I'm happy to continue holding the full allocation that my portfolio diversification rules allow, even at what I consider to be fair value.   Turners are one of the few nzx listed companies that actually generates eps growth and ultimately returns for shareholders. I think some don't fully appreciate the potential for consolidation in the used car market and Turners are best placed to take advantage of that opportunity. 

[Basil]

After rebalancing I'm approx 11% portfolio allocation.

[winner (n)]

So F26 PBT going to be about $63m and next week they are going to reveal its earnings target for the next five-year period.

Lets gues the targets eh

Marketscreener has F26 at $61m and F27 at $70m and F28 at $77m

If Todd comes out with anything less it could be deemed to be a DOWNGRADE

So lets run with -

F27  $72m
f28  $80M
F29  $88m
F30  $98m
F31  $107m

Seems pretty reasonable to me

I'll leave it up to Basil to come up with a likely share price and dividend in @031

So they round it to $100m in F31 .......of course they being conservative eh ..... just in case


Underpromise and over deliver their game

[Basil]

Yeap, I reckon they get to $100m a year early in FY30 just like they've achieved other targets early. Under promise and over delivery is their M.O.
I see they're now forecasting 33 cps in dividends this year. $100m / $63m x 33 cps = 52 cps in annual fully imputed dividends by FY30.

FY26 $63m to FY30 $100m = 12% CAGR. The 12% CAGR journey shareholders have enjoyed ever since "Tina" started in 2021 looks likely to continue.
My FY30 price target = $13.50, same multiple its currently on, driven entirely by compounding EPS growth.

[Dolcile]

Some (like me) might say that a 12% forecast cagr makes Turners look like good value :-)

[Basil]

Agree 100%.  Gosh there's a lot to like about the crystal clear way they communicate their growth strategy to the market.  I wish management at HLG did that.
Stunning growth in their loan book of 23% since February 2025 and all the while the average credit rating of the book goes up.  Gold star to management !

[Dolcile]

I loved this statement "We have performed well in a down cycle and will perform even better in an upcycle"

[Mos]

The discipline in sticking to the core automotive buy/finance/insure/sell formula provides real comfort, with the Turners Servicing aspirations reasonably modest over the next 5 years. Often, on the back of success, Management teams believe they can do anything and squander capital on ambitious growth aspirations in new markets (geographies or sectors) where they lack competitive advantage. Turners seem to have a tight and disciplined view on where and how they will maintain, and build winning competitive positions to generate increasing eps and dps.

[Basil]

Gosh I didn't realise that both Todd and Aaron have been there for 20 years !  Hugely experienced in their field of expertise.  That's another thing that gives me comfort with TRA and also genuinely serious skin in the game with management and directors having circa 30% ownership of the company.

[winner (n)]

Great leaders have conviction ..which lead to success

John F. Kennedy didn't say "we're going to have a really, really great, top-tier space program folks!"  He said, "we choose to go to the moon."

Todd is not saying we're going to a lot of great things ...he's saying 'we are going make more than $100m by 2031"

[Waltzing]

Notice the ADD marketing campaign targets the demographic and just saw an indian women surgeon having lunch with a Dutch women doctor and they both drove very ordinary cars... Bought im sure from a second hand dealer...

These professionals live on the health budget kick backs where the public are there bread and butter. The supplementary payments for pregnant womens health was the discussion.

Every sector has felt the impact of the for ever recession. If they make this in recessions then there business is already streamlined for survival.

[Waltzing]

Anyone noticed the closing SP?

[winner (n)]

Anyone noticed the closing SP?

$8.82 ....think that's an all time CLOSE high