OCA - Oceania Healthcare

[winner (n)]

Hey BP ... that 'bend in the trend' you mention is going to start today

You'll be able to claim you called it first

What's analyst targets now ....will need to track progress towards them

Amazing what change in sentiment can do to a share price ....not bending based on awful fundamentals

[BlackPeter]

Hey BP ... that 'bend in the trend' you mention is going to start today

You'll be able to claim you called it first

What's analyst targets now ....will need to track progress towards them

Amazing what change in sentiment can do to a share price ....not bending based on awful fundamentals

Nothing wrong with the fundamentals ... it is just the hype factor which used to be awful. You recon it is turning now? I guess everything is possible ... If we assume that the real estate market turns mid of the year and shares are typically 6 months ahead of the economy ... you well might be right.

Are you backing up the truck?

[Basil]

BP - The REIT's like ARG and KPG trading at a similar discount to NTA as OCA but with 100% of their business working for them properly and effectively yielding 8.5 - 9.2% gross (for 33% taxpayers), look like a far more compelling investment case to me. 
The way I see it is if you're going to park money in a no growth share you should choose one that gives you a proper yield.

[BlackPeter]

BP - The REIT's like ARG and KPG trading at a similar discount to NTA as OCA but with 100% of their business working for them properly and effectively yielding 8.5 - 9.2% gross (for 33% taxpayers), look like a far more compelling investment case to me. 
The way I see it is if you're going to park money in a no growth share you should choose one that gives you a proper yield.

Yes and no. While ARG and KPG have obviously no expenses to pay for running expensive care facilities, they can't resell the same unit every three years (or so) either.

I recon there are benefits and drawbacks on both sides.

Anyway - at this stage I believe that 2023 will turn to be a year with very good buying for REITS ... up to the individual which flavour one prefers ...

[winner (n)]

Nothing wrong with the fundamentals ...

Suppose when looking at OCA Book Value per Share since listing you could conclude nothing wrong with fundamentals. Book Value a good metric because it includes realised gains on sales as well as unrealised valuations, value of land etc held, and operating profit/loss. Basically NTA for those who prefer that measure

It's grown at 11% pa .... pretty good but last 18 months growth has been 8% pa

Pty the share price hasn't grown at 11% pa since listing eh

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[lorraina]

Really interesting,thanks for posting.
How do they compare with ARV,RYM and SUM.?

[winner (n)]

Really interesting,thanks for posting.
How do they compare with ARV,RYM and SUM.?

Here's the others - indexed to 2017

Wonder what a similar chart will look like in 2027?

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[lorraina]

Thanks for posting.
 An incredible performance by SUM.

[winner (n)]

Thanks for posting.
 An incredible performance by SUM.

Bodes well for Oceania 2nd half ........be good if their sales are up 18% (or more) as well

[lorraina]

 Yes I was thinking the same issues /conditions would be the same for all in the sector.
Hopefully OCA have concentrated on new unit sales.
Mr Scoullar said that the motivation to move into a retirement village is often driven by life events, not the property market.

"Our residents are driven by factors like community, security or health, which lead them to look at an offering like ours. These influences don't change significantly even in a difficult property market. As a result, we continue to see good levels of demand across our portfolio."

[Basil]

Bodes well for Oceania 2nd half ........be good if their sales are up 18% (or more) as well

Comparing chalk with cheese there.

[winner (n)]

Ryman gave FY23 guidance today - FY23F underlying profit guidance in the range of $280 million - $290 million, about 10% higher than FY22

Bad sign is that means second half underlying profit is going to be less than last year - sales not going that well?

Jeez hope OCA are going to do better than that - going backwards in H223 would result in full year being less than last year

Suppose we need to wait until end May to find out

[winner (n)]

Lot of media/analyst commentary on RYM capital raise

Common threads have been -

- investing cash flows generally higher than operating cash flows. In plain terms cash burn
- more debt needed to fund the cash burn
- dividends have been paid despite negative cash flows
- essentially increased debt funded dividends

 Much the same story with Oceania. Chart below tells a story of sorts and after Ryman finish their cap raise Oceania takes over the mantle of the most leverage in the sector

In summary since Nov 2016 -

OCA have 'burned' through over $500m of cash
OCA have paid about $13om in dividends
OCA have raised about $120m in new capital
OCA have increased debt by about $400m

Maybe OCA next cab off the rank to strengthen its balance sheet

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[Basil]

Great post Winner, agree 100%.
All in this sector have now announced a review of their build rate going forward except OCA.

After the RYM capital raise, assuming punters back current management to support RYM, OCA moves to the top spot in the sector in terms of having  the highest gearing.

They will be extremely keen to liquidate their 10 lame duck villages with no development potential but who on earth is going to be the buyer for those lemons in this market?

Carrying value is approx $60m but the real value, if there is one at all, is likely to only be a fraction of that.

[Waltzing]

There are no buyers in tis market as only fools are buying at these levels...

I know a couple who are leaving in June and have bough in up state New York. Almost as bad as buying on the east cost of NZ... but its a lot cheap and they get 10 acres and a Barn...

hes US shes NZ....

She doesnt want to move but the house prices here are "eye water, nose bleed" were the comments....

what if over the next 10 years this was the high point...

there must be a lot of hurt out there in the mortgage market..