HGH - Heartland Group Holdings

[mfd]

Worth remembering, at the last raise the mechanism gave punters shares at a near 2% discount compared to institutions (priced at 1.80 or a weighted average trade price). People still complained about that one, often preferring rights issues as your entitlements are clear and fair.

Seems like whatever companies do to raise capital there will be complaints. Tough gig.

[LoungeLizard]

Glad you're taking my genuine concerns about HGH seriously there, BP.

For the record, I was virtually the only one on this site, and amongst a handful on the other, that gave clear warnings about the last cap raise and what might - and did - happen to the SP. If I sound like a broken record then that's because I have said it all before - and nothing has changed.
 
Rather bizarrely, the same people who were critical of my contrary views then, bought in to CR, and then, realising their error, dumped their shares at ta loss, are the same ones who are cmost critical now.  Even more bizarrely, those who stayed in and took a 35% haircut, are still super-sensitive about the very suggestion that they got it wrong. Doubling down can work, but sure as hell didn't in this case.

Well, I've said this before as well - good luck to holders. I don't like seeing people losing money, even if they had fair warning. Those taking a punt - and that's what HGH has become, a punters stock - may get some joy after a few bumpy years . Personally I'd rather invest in something with more dependable growth, but each to their own.

[winner (n)]

Our Greg putting $14m into the pot

Hope Oceania don't do raise on next month or two

[entrep]

Hoping to pick some of these up for a buck in the coming weeks.

[Left Field]

Hoping to pick some of these up for a buck in the coming weeks.

You may well get the opportunity.

1.) It's not just Jeff leaving just as Challenger get their licence, the announcement outlines 5 more key personnel changes at a crucial time. Personnel changes of this magnitude usually indicate issues.

2.) Will HGH promised dividends stand and will the Challenger takeover be  "EPS accretive"?? While we all hope so, and as today's statement points out the nice growth in Challengers deposits, HGH does not mention the costs of assimilating Challenger, like aligning software systems, the need to train staff, staff layoffs, or any the likelihood of unforeseen issues, the need for provisions and write-downs etc etc. In addition, in Challenger's existing role as operating a fiduciary Funds Management division, an APRA-regulated Life division and an APRA regulated authorised deposit-taking institution means there are likely to be other calls on the increased deposits including Challenger Life Company Limited which is Australia's largest provider of annuities.

What could possibly go wrong?

[Basil]

Is it better to buy up trending bank shares on extremely high (for banks), metrics or one that's been beaten down on a record ever low metric ? 

Harbour opines on the Aussie banks https://www.harbourasset.co.nz/research-and-commentary/harbour-navigator/

Tough crowd to please.  Some, including myself, were calling for Jeff to go and others hated the uncertainty of will they, won't they get approval for this acquisition.

Now he's going and the approval is forthcoming and the capital raise under way and we have HGH on the same record ever low forward metric and some are still deeply unhappy.  You'd be forgiven for thinking one or two would only invest if it was on a forward PE of only 1 lol.

Winner throwing away his previous deep value playbook as well as my well proven comparative peer group analysis and relying on the Warriors winning their games as his new value accretive strategy.  Oh my goodness...I'm lost for words which is a first for a very long time lol

[Left Field]

Is it better to buy up trending bank shares on extremely high bank metrics or one that's been beaten down on a record ever low metric ? 

Harbour opines on the Aussie banks https://www.harbourasset.co.nz/research-and-commentary/harbour-navigator/

If the SP goes below $1.00 as Winner mentioned on the other channel, HGH may well be a good 'BUY'. Alternately we could wait longer till there is 'good news' and an 'up trend.'

[Basil]

Its already on the lowest forward metrics it's ever been on since HGH 101 or 201 series has existed.  Bank license approval is good news as is the increased level of new deposits Challenger is getting at far higher than expected cost savings. 
Winner told me privately It only goes under $1 if the Warriors draw their next three games in a row   
Its all good, we're now on our way to $200m+ in FY28.

[lorraina]

I am pleased the Bank licence approvals have been granted.
And will be happy once the "darn" capital raise is done and dusted.
Jeff Greenslade has done great work,getting HGH formed,getting a NZ Bank licence,buying the REL business and developing it,and capping it all off by getting an Australian Banking Licence.
Laid very strong foundations.
Just a pity former Chairman Geoff Ricketts died before the Australian Banking business was achieved.

[winner (n)]

That $200m profit in 2028 will be about 20 cents share

That's not too bad from estimated 14 cents this year .....40% increase over 4 years

Jeez eps 20 cents valued like some of those Oz banks would give a share price close to $3

Great time to be buying ...a down beaten stock with strong growth on the way

[Basil]

People buying in the capital raise at $1 could triple their money in four years.  Even if it got back to the midpoint of its traditional metrics range of 9-18, i.e. 13.5, that suggests $2.70 is quite plausible and that's for $200m profit and assumes 1,000m shares on issue by then with DRIP issues over the next 4 years.  But they are talking $200m+ in their presentation so maybe $3 is quite plausible?   If extreme pessimism now eventually swings back to over optimism in the years ahead like it has so many times before with this stock, we could be looking at top end metrics of 18 on eps of as much as 22 cents by FY28 giving a high-end case of as much as ~$4

Whatever...need to get as many shares as possible in the capital raise at $1 while all the naysayers think its doom and gloom and this will never recover and if the share price goes close to that $1 level in the lead up to the retail close out date of 22 April, this old dog will be looking for a proper truckload.

[Buzz]

That $200m profit in 2028 will be about 20 cents share

That's not too bad from estimated 14 cents this year .....40% increase over 4 years

Jeez eps 20 cents valued like some of those Oz banks would give a share price close to $3

Great time to be buying ...a down beaten stock with strong growth on the way

The offer at significant discount to SP at the time of Trading Halt, suggests low expectations from HGH imo. Although I'm sure they'll achieve a good proportion or even full placement, that discount will be reflected in the market tomorrow, a roughly 15% discount to Friday last week. Shareholders taking a haircut either way.

The TA on this is dreadful, falling out (down) from the long term down channel and well below all meaningful EMA's. Just awful. No momentum trader should touch it. It looks like a loooong road to SP recovery and with slashed dividends and uncertainty whether even they are sustainable, HGH imo at this point in time is not an investment, it is a speculative punt on the future, and who knows how long the future is.

As KW would say, "never buy in a down trend, you bloody idiot"!

[Basil]

There's only one old dog on here that has the track record of consistently timing the low and high points of this stock and it isn't KW. 
Sometimes you have to grow a pair and throw the TA momentum playbook in the trash can for a while...this is one of those times.

[Gerald]

That $200m profit in 2028 will be about 20 cents share

Thats a gross target, not an eps target. Just need a few more cap raises along the way to get there.

[LoungeLizard]

Hoping to pick some of these up for a buck in the coming weeks.

Yep, that's a real possibility once trading gets under way. Those who kept their powder dry and waited will do much better and have more options, than those who think they timed the market and bought in at $1.17 let alone those who got carried away with the dead cat bounce and bought in at $1.30. There will many who I imagine will be forced to take the full entitlement just to try and average down. How that is perceived as a "win" is beyond me.

There's a good chance that the SP, post entitlement, will gravitate to $1.10 and perhaps to $1. If there's a major sell off like the last cap raise, then sub $1 is possible. Not likely but possible. Maybe it's a buy at those levels, IF Challenger can turn a profit, there's no skeletons in the closet, and Jeffs claim to acheive $200m NP by 2028 starts to look realistic. Oh hang, on Jeffs not there any more. IS the new CEO going to say the same thing?