HMY-Harmoney

[Hectorplains]

Yowser!  What a neat update... Aussie going gangbusters.  "Reaffirm FY23 outlook, including significant growth in Cash NPAT."

[Forrestdun]

Hit an all time low after I increased my holding by 10%, sounds about right.

[Hectorplains]

Hit an all time low after I increased my holding by 10%, sounds about right.

On reasonable turnover too (well for HMY anyway) - it looks very cheap but there is also no end in sight for this downward plunge. 

[lorraina]

One of those shares where I think I may have missed something.?
Announcements are positive.
Will continue to hold,as I love their NIM and their growth rate.. 

[Hectorplains]

One of those shares where I think I may have missed something.?
Announcements are positive.
Will continue to hold,as I love their NIM and their growth rate.. 

Snap - same.  Grossly overpriced at IPO but I thought was good buying when I got in the 80's.  Must be spectacular now - but I'm not averaging down.

[Forrestdun]

New all time low of 35.5 cents per share. Market cap of around $38mil and the business had $30mil cash on hand at December. Someone really wants out....

[Forrestdun]

Trading update out, good read

[lorraina]

HARMONEY ON TRACK TO DELIVER OUTLOOK FOR FY23
• Origination and loan book growth
• Net interest margin to be maintained at ~10%
• Cash NPAT Growth
• Targeting 20% Cash ROE in the medium term

https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02658504-2A1445627?access_token=83ff96335c2d45a094df02a206a39ff4

[Hectorplains]

  No love from the market thou, no sp movement on yesterday and only a few pips above all time low.

[Hectorplains]

Looking to test lows again.  Seems very lost and unloved on the winds of the ASX.  Harmoney roads must a man walk down before they call him a man... 

[Hectorplains]

Another excellent announcement but the sp has only crawled back to where we were in May  {{{{sigh}}}}

[Plata]

Funny, I was just looking at this yesterday pondering a buy in or not. Ah well. What scared me off is how they throw around this cash npat term. Statutory npat running at a big loss due to expected impairments provision increasing. So surely, most or at least some of this provision will be lost right? So how is it reasonable to remove the impact of the entire provision movement to bring npat back into the green? Have I misunderstood something?

[Fiordland Moose]

Funny, I was just looking at this yesterday pondering a buy in or not. Ah well. What scared me off is how they throw around this cash npat term. Statutory npat running at a big loss due to expected impairments provision increasing. So surely, most or at least some of this provision will be lost right? So how is it reasonable to remove the impact of the entire provision movement to bring npat back into the green? Have I misunderstood something?

yes you are dead right - the cash npat they refer to removes the movement in expected credit loss provision. It does include the actual credit losses incurred during the period, but then excludes the movement in provision booked at year end for the future credit losses expected over the full life of all the loans (with loans lasting 2-3 years on average). I think you can safely expect a negative statutory npat for the full year. 'cash npat' is industry standard for the fintech industry (rightly or wrongly), but in my view unlikely to be adopted as the valuation basis by the mkt (ie the right earnings number to apply a PE multiple to). I asked mgmt to justify their use of it once - they said it was the best proxy for operating cashflow, and that stat npat adversely impacted the most during high levels of book growth, given the negative movement in provision well be equally as large but the economic benefit is lagged (ie in the year just been it is only reflecting a partial year contribution from the loan but you are booking a loss for all of the future expected credit in one year). The inverse is true - if they were to slow the book - it would flip into a large positive movement in provision and stat npat would suddenly look good with a declining book. a competitor of HMY dropped their book down and recorded a surge in stat NPAT - its SP went up like 30-40% over 2 days and fell all the way back down over a few weeks - mkts have a real challenge in accepting and valuing these businesses. traditional banks have the same movement in provision but given they grow slowly its not as dramatically pronounced. measuring true cashflow in a bank, fintech or other financial insto is notoriously difficult.
[edit, wording.]

[Plata]

How does rolling out stellare 2.0 impact the existing engine in finding customers etc. They are blaming it for 24H1 cash npat forecast being lower. Are they going to go dark for a week or two to make the switch or something.

[Hectorplains]

Smack on the wrist time, late 3Ys.  Tisk tisk... More importantly it'd be nice to see a director buy on market rather than just highly discounted 'incentive plan' pick ups.