I took the liberty of borrowing this post by Dirty Dingus I hope he doesn't mind.. follow the links if you like and see if you find it interesting.. http://boards.fool.com/Message.asp?mid=16768566 cheers.
sorry to do this but I thought some might find this of general interestg as well.http://boards.fool.com/Message.asp?mid=16777456 FC,
Cassie,both links interesting. Really liked your second one apart from it being a bit short. ;) The first link,didn't follow his link, but I straight out believe andrewychan is wrong. Yes I know the game he is talking about and he is right in that respect.But, it appears to me that he is saying- I don't hold it against them for lying and misleading people because I know why they are lying. They are lying to "feather their own nest". I hold it against the poor suckers who believe them and make their investment decisions on the so called professionals opinions. Well, what a load of tripe.
Hi Barcoo, yes the second one was long allright, sorry.. I didnt like Andrewchan's attitude either, he sounds like the cynical product of a cynical industry-- (more dodgy practices than hairs on a cat's back) and the fact that he is comfortable with it makes it even worse best, fc.
FCthat was a great article and helped me to focus on 10% not being a bad return. It started me becoming more realistic.regardsJudy
yes the second one was long allright, sorry..no need to apologize, I liked the content.
Hi Judy, glad you liked the article, For myself I much prefer 10% with some safety to 16% with mad risk..my preference anyhow.. I was surprised at this bit though........ "60% of current fund managers have not seen a serious recession or market crash" Wonder how old the fund managers are around here? Cheers.
you know what my problem is fatcassie?I have all these good crtiteriaROIC - greater than 19%debt ratio as low as possible - and preferable no bank debtreturn on equity greater than 16%margin of safety of 20%p/nta below 1pe around 10 or belowdividend yield more than I could get in the bankpositive cash flow, ev/ebit - to give me a return of about 20% or higherincreasing sales and reducing recievables and inventoryhigh profit marginwell, I have not yet really found a company that has all this - and I like buying shares and have made some money with them. I get impatient and then ring up my broker (who I trust) and buy on his recommendation (at the moment he told me there is nothing to buy) . I really like guiness peat group and should do a proper study of that - ron brierley seems to know what he is doing. its pe=2.6, p/nta = approx 1; its interest coverage is 1.36 ( i like to see greater than 3 - it was in one of the books i read by roth and seems conservative) but its dividend yield is 2.10%. its 130 out of the top 150 companies by capitilisation in the australian market. that's done it - I had better do a proper study of this company - i have been following it for about 2 years and it doesn't look like a fly be nighter. (and I am in a buying mode better to buy an investment than another nick nack that I have no use for - and i do so enjoy investigating companies and of course making money.)Judy
Judy ,I know what you mean.. I reckon your broker is right-- no bargains to be had...at least that's what I'm finding. This is the trouble with the Aussie market-- take out the banks and some of the big miners and what's left? not much that isn't overpriced ! I have been looking at CANSLIM and gave up the idea .. the criteria are just too stringent for the AUS market, guess if we want to keep investing we just cant be that fussy! ( How about just going short term take the money and run?) ( Go over to the dark side--lol) Anyhow, if I come across anything about Guiness Peat I will post it..( I guess you have already tried the UK boards.) Best. FC
FCyes, I have tried the UK boards.the main trouble with research guinness peat is that it doesn't have a web site and when I rang last time to get the financials it took about 2 months.Maybe I should bite the bullet and pay Huntley's for their research - though I don't really like their style.Judy
Judy,This bit from NZ. GPG publishes its book value only twice a year, whereas most investment trusts and unit trusts disclose their net asset value, using market prices, daily. Various stockbroking firms try to calculate GPG's asset value from time to time, but these values are highly uncertain as GPG doesn't like disclosing what its portfolio looks like to all and sundry. Related to this is the potential for GPG shares to trade at a premium or discount to their asset value. This presents an extra dimension of risk, or, to look at it in a more positive light, an element of opportunity, for the retail share investor. http://www.nzherald.co.nz/business/businessstorydisplay.cfm?My notations on gsp,I like the big increase in volume & note that Perpetual have been buying, hold 5%.A strong break of $1.50 (res)would interest me.Sector in general showing positive signs.Now from an expert,19.01.2002 Sir Ron's fans just love GPG. But is the company really that good? BRENT SHEATHER takes an analytical look at GPG and its returns. They are not affiliated with al Qaeda, but many Guinness Peat Group (GPG) shareholders are no less fanatical. In New Zealand alone, they number in the tens of thousands - 25,717 as of December 10. So committed are these hard-core shareholders, often men aged 55 and over, that they frequently put aside basic diversification theory and instead run portfolios highly concentrated on GPG, the investment vehicle of their supreme leader, Sir Ronald Brierley. Many view diversification as nonsense, and proudly point out that not only do they own GPG shares, they own the company's capital notes as well. Woe betide the nitwit adviser who suggests that having 40 per cent or so of your investments in Sir Ronald's hands might not be consistent with modern portfolio theory. You will inevitably be reminded that "since I bought the shares they've doubled", that there have been numerous free bonus issues, and reminded of the many and varied triumphs of the old master himself. Typically, any defence of GPG is heavy on emotion and short on facts. One has to have one's wits about one just to calculate the return on the shares properly, adjusting for the many share issues which have occurred over the years (I used the NZ Stock Exchange to do the sums). But in the almost 10 years that Sir Ron has been doing his own thing after Brierley Investments, albeit with many of his former cohorts, and after adjusting for those cash and bonus issues, how does GPG stack up as an investment? Does the fact that many individual GPG shareholders tend also to have had a high weighting in New Zealand shares generally cloud their perspective? Certainly the local sharemarket has provided the means to do substantially worse than GPG over the last 10 years. We know that one way of looking tall is to stand by a short person, and compared with the NZSE gross index just about any developed country's sharemarket looks good. The question is, does GPG's performance still shine relative to a diversified portfolio of global shares? After all, GPG invests much of its money overseas and has thus benefited from the enormous depreciation of the kiwi dollar over the past 10 years. The comparison is also valid because with the advent of the AMP Winz Fund, unit trusts and the local listing of several UK investment trusts, New Zealand investors can buy a portfolio of global shares just as easily as they can buy New Zealand shares. Measuring GPG against the New Zealand Stock Exchange index (see graphic) perhaps explains why GPG aficionados feel so strongly about their stock. GPG has returned an average of about 15 per cent a year since it listed, versus 11.5 per cent a year for local shares. But although such a local comparison may have been all well and good when you were unable to buy overseas currency easily and were forced to invest in local shares, things are quite different today. Now we need to consider GPG relative to the entire universe of global shares. Comparing GPG's performance since it listed in 1991 with that of global sharemarkets, as measured by the MSCI global index, shows that again, GPG outperforms, although not to the same extent. Over the period, GPG produced returns averaging 15 per cent a year, compared with 12.9 per cent a year for the world sharemarket index. This is a very creditable performance, as most fund managers find comparison with the MSCI index rather embarrassing. But before we rush off and swap our Winz shares for GPG, we need to appreciate that GPG is more risky than the world sharemarket - while its returns have been higher, they have also been much more volatile. This is because GPG borrows to invest and Sir Ronald runs a far more highly concentrated portfolio than the world sharemarket. Although the long-term track record has been good, there have been a few bad investments, Otter Gold for example. There are other risks associated with GPG. For example, knowing what shares it owns and how much they are worth at any point in time. GPG publishes its book value only twice a year, whereas most investment trusts and unit trusts disclose their net asset value, using market prices, daily. Various stockbroking firms try to calculate GPG's asset value from time to time, but these values are highly uncertain as GPG doesn't like disclosing what its portfolio looks like to all and sundry. Related to this is the potential for GPG shares to trade at a premium or discount to their asset value. This presents an extra dimension of risk, or, to look at it in a more positive light, an element of opportunity, for the retail share investor. V ARIOUS stockbroker reports say GPG's shareprice is 25 per cent or so below the value of the assets it owns. In the UK, investment trusts typically trade at discounts to net asset value reflecting the cost of liquidating the portfolio (liquidity risk) and the management fees associated with managing the portfolio. Many investment trusts with a smaller company orientation - like GPG - trade at discounts of 20 per cent or more, perhaps because the market believes that if they sold out it would push down the market prices of the companies the trusts own. GPG would no doubt counter that by arguing that its strategic stakes merit premiums to market price rather than discounts, so, depending on one's point of view, one can argue either that the GPG discount represents a genuine bargain or the workings of an efficient market. There's another risk associated with investing in one company as opposed to a broad selection of shares; if Sir Ronald or a few of his lieutenants were taken out would GPG survive and prosper? Despite the various bullish broker newsletters emanating at the time, GPG's $250 million issue of capital notes paying 9 per cent last year can be viewed as a threat to returns on GPG shares. Luminaries such as Warren Buffett and commentators from the Economist have forecast that the average return from shares in the next 20 years is likely to be 7 or 8 per cent a year. Thus the 9 per cent coupon rate that GPG has to pay on the capital notes looks rather expensive. My conclusion is that although GPG's long-term performance has been good, one would struggle to justify having more than 10 per cent of a client's international share portfolio in GPG shares, because of the various risks specific to GPG and the fact that there are a few more conventional low-cost, tax-effective share funds which have done as well or better than GPG over the past 10 years while incurring a lower level of risk. No doubt GPG fans will argue that the bull market just ended provided the worst possible backdrop for performance comparison and the execution of GPG's investment strategy and, further, that the growth in GPG's net asset value has been well in excess of share price growth. Fair enough, but the share price nevertheless represents what you can sell the shares for. Many shareholders will be content to reflect that long-term ownership of GPG shares permits them the thrill of sharetrading, takeovers and such like without the attendant losses suffered by most day-traders. Beating the MSCI index into the bargain is the icing on the cake. * Brent Sheather is a Whakatane sharebroker and investment adviser. * Disclosure of interest: Brent Sheather owns GPG shares.JR
Judy,Got me interested, UK some big vol, just below important res.http://www.henley.co.nz/markets/Quote.asp?GMC=152&Symbol=GPG&Period=3Y&MA1=50&MA2=0&cmdDraw.x=28&cmdDraw.y=4NZ chart,a break of $1.80 bullish.Again volume build up noted.http://www.henley.co.nz/markets/Quote.asp?GMC=100&Symbol=GPG&Period=3Y&MA1=50&MA2=0&cmdDraw.x=28&cmdDraw.y=7Looks good from a TA point, although res must be broken, the vol signs are encouraging.JR
The OZ chart.The volume buildup is notable on all 3.http://www.henley.co.nz/markets/Quote.asp?GMC=92&Symbol=GSP&Period=3Y&MA1=50&MA2=0&cmdDraw.x=46&cmdDraw.y=1Yep, onto the number 1 watch list.Thanks Judy.JR
Bit more,Sir Ron Brierley's investment vehicle, Guinness Peat Group, is looking to England and Australia for opportunities to spend its estimated $500 million to $600 million war chest.Nice timing, not a bad thing to have handy these days,the old war chest."We're not a sausage factory so we won't be spending money for the sake of it, but only when we think it is a very good deal with an opportunity for reasonable profits."A better approach than most of this ilk, I think, the others seem to have a must be fully invested type of approach, which is often distructive."Without giving anything away I can say there is plenty on our radar screen and we have a lot of plans regarding what we want to invest in. "At this stage it is true to say our primary interest is in England and perhaps Australia because of the size of their markets.http://www.nzherald.co.nz/business/businessstorydisplay.cfm?storyID=586656&thesection=business&thesubsection=markets&thesecondsubsection=sharemarket&thetickercode=GPGJR
JRthanks a lot for that - a very interesting article. Maybe I will just hold off for a while - everything is looking very over valued - a do some research and learn how to value companies and do my research of them in more detail.Question - when I did a google search on GPG I came up with one listing and it wasn't very good. How do you do your searchs?Judy
JudyRE google search,http://www.google.com/search?hl=en&q=guinness%2Bpeat%2Bresearch&spell=1JR
thanks jrI can see what i am doing wrong - I should add the words.Judy
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