# PRK - Patrick Corporation



## Investor (20 May 2005)

Part of my long term holdings. Was tempted to top up with recent SP weakness, but decided to keep some "powder dry". 

In The Australian newspaper today:

Dream team pleases the investors

STEP by step, Patrick Corp chairman Peter Scanlon and chief executive Chris Corrigan are realising the dream of the late Peter Abeles to build an Australian air, sea and land transport company. The market can see the short and long term potential, which is why the shares jumped yesterday.

Smaller shareholders need to realise that in assessing share values, Patrick's half-yearly earnings can be calculated at around 17c a share or an annual rate of 34c. This puts the stock on a price-earnings ratio of about 16 after the price rise. 

Scanlon and Corrigan are a formidable team and together they own close to 10 per cent of Patrick. Scanlon's slice is 6.6 per cent and he is worth $430 million in the latest BRW Rich List. 

Corrigan's investment prowess helped put the name BT on the Australian investment map in the 1980s and he owns 2.3 per cent of Patrick but has options. 

Scanlon is one of Australia's best strategists and helped mastermind the conversion of the Victorian Football League into the national Australian Football League code. 

Corrigan assists in strategy at Patrick but knows how to implement. He is a formidable person to have as an enemy and does not take prisoners. 

After taking control of Virgin Blue, Scanlon and Corrigan are already beginning to deliver a message to Geoff Dixon at Qantas that there is lots of money to be made in a duopoly and there is a common enemy to fight -- Max Moore-Wilton and Macquarie Bank, who control Sydney Airport. 

In Corrigan's eyes, Sydney Airport has simply become an arm of the "millionaires factory" and to lift the wealth of Virgin he has to stop the airport fee-hike game. 

Dixon would also be delighted that Virgin has stopped looking to Asia and will curb its local expansion. Over time, Virgin might take an increased slice of the business traffic but its attempt to be the largest Australian domestic airline, which sparked the massive Qantas retaliation in establishing Jetstar, has been abandoned. Airline traffic will ultimately absorb the excess capacity, so profits for both airlines can move up. 

The Patrick rail operation, which includes the Pacific National joint venture with Toll Holdings, was a typical example of the Scanlon-Corrigan strategy. They bought in at low prices, fixed the work practices and invested in better equipment. And they achieved a quick win because the higher fuel prices switched business from road to rail. 

In ports, Corrigan is being squeezed by Melbourne's port regulators, who want "competition" for Corrigan via a new stevedore and a revamped P&O. At this week's infrastructure conference Corrigan put them on the same list as the hated Sydney Airport managers. 

He had proposed to build one of the region's biggest port facilities in Melbourne but, when he was blocked by the regulators, he looked to satisfy Melbourne's demand for "competition" by going all out to promote a Melbourne-Brisbane railway. 

That way he can build the "Melbourne" facility in Brisbane, establishing competition between the two ports.

Patrick's turnover in the half year reached $1.4 billion, which compares with Toll Holdings' $1.9 billion and Qantas's $6.4 billion. If Paul Little and the Rowsthorn family want to sell out of Toll Holdings, Patrick is the logical buyer. 

If Scanlon and Corrigan want to sell out of Patrick, then Toll would be the logical buyer. 

Officially, Patrick's stated profit was $99.87 million, which converted to earnings per share of 13.2c. But it is far more meaningful to add back significant items and goodwill amortisation, which brings the real half-yearly profit to $124.5 million. 

The initial rush of growth that Scanlon and Corrigan achieved after reforming the waterfront has ended. 

Profit-boosting actions will be slower but the company has control of vast amounts of irreplaceable infrastructure and operating systems as the dream moves closer. 


My comments: All three core activities of PRK are almost cosy duopolies. Pricing power exists. In the case of PRK's majority holdings of VBA, I think it is only a matter of time before Corrigan lifts the ROE. Chris Corrigan is one of the CEOs that I have a lot of respect for (the others are Roger Corbett of WOW; Chip Goodyear of BHP; Michael Chaney of Wesfarmers; Geoff Dixon of QAN and Leigh Clifford of Rio Tinto).


----------



## Investor (20 May 2005)

*Re: Patrick Corporation (PRK)*

Spending is paying at Patrick
By Philip Hopkins
May 20, 2005

Transport giant Patrick Corp is looking to a major capital expansion of its port and rail operations to drive future growth.

The company's capital expenditure was $127.7 million in the six months to March 31, almost double the amount for the same period the previous year and 90 per cent higher than the six months to September 2004.

Patrick's chief executive, Chris Corrigan, said yesterday this period of big investment - to last another 18 months - should put the company in a strong position in the medium to longer term.

"Australia will need this infrastructure expansion to meet the expected growth in transport and logistics demand in the years and decades ahead," he said.

The market liked the outlook, with Patrick's shares yesterday rising 25  ¢, or 4.84 per cent, to $5.41. The capital expansion pushed Patrick's six-month profit after significant items down 18 per cent to $99.8 million compared with the first half last year.

There was a 28 per cent drop in the contribution from Virgin Blue. The profit before significant items was $105.9 million, an increase of 11 per cent.

Mr Corrigan said debt had reached about $1 billion, including $346 million spent on the acquisition of Virgin Blue - but gearing was about 30 per cent.

Directors declared an interim fully franked dividend of 7  ¢ a share compared with 6  ¢ last year. The interim dividend will be paid on June 15 to shareholders registered on May 31.

Revenue from the ports division increased by 9 per cent to $455.2 million.

Revenue from rail rose by 28 per cent to $588.1 million. Rail is dominated by Patrick's 50 per cent share in Pacific National (PN), but also includes shipping and freight forwarding.

Mr Corrigan said PN had strong demand for coal, but the possibility of a smaller grain crop from the drought was a concern. "Much expansion is required in intermodal and the upgrading of rail terminals in the next four or five years," he said.

Virgin Blue's six-month profit was $75 million. Mr Corrigan said he was optimistic about the outlook for the airline. Oil prices were coming down, and the airline was now going to focus on the business and government market to expand, he said.


----------



## Investor (20 May 2005)

*Re: Patrick Corporation (PRK)*

Following a profit result above its forecasts, Macquarie has upgraded its rating on Patrick Corp (PRK) to Outperform from Neutral.

The company’s profit of $100m compares to the broker’s $93m forecast, with the broker attributing the difference to the consolidation of Virgin Blue (VBA).

Looking ahead, the broker notes the rail operations have been the big improver and should benefit from infrastructure spending drawing to a close, while slower container volume growth should be offset by upside from 
automation and the August 2006 ending of the stevedoring levy, which the broker estimates is worth $20m annually.

Macquarie has increased its FY05 earnings forecast to $210m from $205m, while its valuation and share price target are $6.50.

Citigroup has also upgraded its recommendation on the stock, to Buy, Medium Risk, as the analysts "inceasingly believe Patrick will emerge from this period of significant port investment a much larger, more efficient and materially more profitable entity."

One other broker, Merrill Lynch, rates Patrick a Buy, while six of the top ten brokers rate the stock Hold and there is one Underperform rating.


----------



## Investor (20 May 2005)

*Re: Patrick Corporation (PRK)*

SCHRODER Investment Management Group filed a Notice of becoming a substantial shareholder with 5.44% in PRK yesterday, making it the 6th largest shareholder.

CBA is the biggest shareholder with 11.7%. AMP holds 6.7%.


----------



## It's Snake Pliskin (20 May 2005)

*Re: Patrick Corporation (PRK)*

Do you think Patrick is undervalued at his stage?
How much of an effect does Virgin have on this stock?


----------



## mime (21 May 2005)

*Re: Patrick Corporation (PRK)*

I think Patrick corp is not a bad buy. They seem to have less competition then other stocks.


----------



## ob1kenobi (22 May 2005)

*Re: Patrick Corporation (PRK)*

I agree. The fundamentals are OK. The P/E Ratio could be better, but in general things seem under control and within reasonable expectations. The charts suggest that they are a stock to be considered. The RSI suggests that the current price has returned its trade to a neutral position from a position of being oversold. The money flow would suggest that it is bearish at the moment and the volume is 5.2 million shares. The highest volume this year was february at 12.3 million. This raises the question, why has the volume traded consistently been lower than the Feb high, in fact more than a 50% drop in volume since Feb. It is a company that by its very nature is going to be easily effected by economic downturn (eg. downturn in exports, domestic air travel, etc). Nonetheless, it does have an integrated approach to transport logistics. Certainly one to give a lot of thought to.

 

----------------------
This is merely my opinion and does not constitute financial advice. When considering your financial objectives, please consult a suitably qualified and licenced professional.


----------



## Investor (22 May 2005)

*Re: Patrick Corporation (PRK)*



			
				Snake Pliskin said:
			
		

> Do you think Patrick is undervalued at his stage?
> How much of an effect does Virgin have on this stock?




I will not answer your first question as it could be tantamount to giving financial advice. Here is an assignment for you, if you decide to accept the challenge ... and if you are interested in fundamental analysis. Ascertain the intrinsic value of PRK. Analyse the industry risks of all 3 core activities. Analyse the business risks and mitigants. Analyse the financial risks. Analyse the management risks. 

Sounds like hard work? Yes, it is not easy and it does take time and effort. It depends whether you are interested in such processes. Not many people are. I happen to enjoy it. Such an approach has also meant that I have yet to lose any money in the investment game, for over 20 years.  

As for your second question, VBA has an effect. Going forward, fuel prices and the ability to raise air fares would be prime determinants of future ROE for VBA.

The following article provides some indication (later I will outline the forecasts for air passenger numbers for the next few years, from the BRW):

May 22 (Bloomberg) -- Virgin Blue, Australia's second- biggest airline, is targeting a 30 percent share of the nation's business and government passengers by undercutting bigger rival Qantas Ltd. to help stem declining earnings. 

``We've got 30 percent of the overall market, we should be able to get something like 30 percent of the business and government market,'' Chris Corrigan, chief executive of Patrick Corp., which took control of the carrier in March, told Channel Nine's Business Sunday program today. ``I'd be disappointed if we can't do that.'' 

Virgin Blue, founded by U.K. billionaire Richard Branson in 2000, had a 20 percent drop in half-year profits as fuel costs rose and competition jumped. The carrier aims to boost its ``very small percentage'' of more-profitable government and business passengers by offering cheaper seat prices, Corrigan said. 

``We're not aiming to get up to the price level of Qantas, we're aiming to be well under the price level of Qantas,'' Corrigan said. ``If we can be 10 percent under that's going to attract people to come to us.'' 

Virgin Blue shares fell 1.5 cent to A$1.68 at the 4 p.m. market close in Sydney on May 20. Patrick's shares closed 15 cents higher at A$5.56. 

Patrick, Australia's largest port-handler, lifted its stake in Virgin Blue to 62.4 percent from 45.4 percent after bidding A$1.90 a share for the rest of the carrier on Jan. 28. Branson's Virgin Group retains a 25.6 percent stake. 

Ticket Prices 

Virgin Blue said May 18 net income declined to A$75.1 million ($56.8 million) in the six months to March 31 after its fuel bill surged 65 percent and competition from Qantas' one-year- old Jetstar unit drove down ticket prices. 

Corrigan, who has blamed rising airport fees for denting profits, said there were few extra cost efficiencies the company could bring in to bolster profits. ``I don't think there are any great cost downs that we can achieve,'' he said. 

Australian domestic airlines carried more than 38.7 million passengers in 2004, a 14 percent increase from 2003, according to the government's Bureau of Transport and Regional Economies. Since Virgin Blue began flying in 2000, the number of passengers carried by domestic airlines increased 29 percent. 

Qantas said Feb. 17 that net income in the six months ended Dec. 31 rose 28 percent to a record after costs cuts and a tax benefit.


----------



## ob1kenobi (22 May 2005)

*Re: Patrick Corporation (PRK)*



			
				Investor said:
			
		

> I will not answer your first question as it could be tantamount to giving financial advice. Here is an assignment for you, if you decide to accept the challenge ... and if you are interested in fundamental analysis. Ascertain the intrinsic value of PRK. Analyse the industry risks of all 3 core activities. Analyse the business risks and mitigants. Analyse the financial risks. Analyse the management risks.
> 
> Sounds like hard work? Yes, it is not easy and it does take time and effort. It depends whether you are interested in such processes. Not many people are. I happen to enjoy it. Such an approach has also meant that I have yet to lose any money in the investment game, for over 20 years.
> 
> ...




Good call Investor! Chris Corrigan was talking about VBA and Sydney Airport in the Sunday Telegraph. You've highlighted how important it is to do your own research, since we are all looking for different things when it comes to investing and trading.

 

--------------------------------

This is merely my opinion and does not constitute financial advice. When considering your financial objectives, please consult a suitably qualified and licenced professional.


----------



## Investor (22 May 2005)

*Re: Patrick Corporation (PRK)*



			
				ob1kenobi said:
			
		

> .... The P/E Ratio could be better, ....




When analysing P/E ratios, do not just use the reported P/E per se, based on reported EPS, but always analyse amortisation of goodwill (a non cash accounting entry) in the P/L Statement as well. 

Under the soon to be implemented IFRS, goodwill no longer has to be amortised, unless there has been impairment of asset value.

In PRK's case, the P/E adding back amortisation, is much better (and more meaningful) than the reported P/E.


----------



## ob1kenobi (22 May 2005)

*Re: Patrick Corporation (PRK)*



			
				Investor said:
			
		

> When analysing P/E ratios, do not just use the reported P/E per se, based on reported EPS, but always analyse amortisation of goodwill (a non cash accounting entry) in the P/L Statement as well.
> 
> Under the soon to be implemented IFRS, goodwill no longer has to be amortised, unless there has been impairment of asset value.
> 
> In PRK's case, the P/E adding back amortisation, is much better (and more meaningful) than the reported P/E.




Thanks for that. I do look at Goodwill as an intangible asset and allow it to speak for itself (mindful that it can be exaggerated at times). Makes sense to rework it into the P/E ratio. Thanks for the tip.


----------



## Investor (22 May 2005)

*Re: Patrick Corporation (PRK)*



			
				ob1kenobi said:
			
		

> Thanks for that. I do look at Goodwill as an intangible asset and allow it to speak for itself (mindful that it can be exaggerated at times). Makes sense to rework it into the P/E ratio. Thanks for the tip.




You are welcome. I read about this aspect of analysis from one of Warren Buffett's writings. It also applies to Sonic Healthcare, which is why SHL always trades at a very high accounting P/E.

You are right about the need to analyse the quality of the goodwill. An on-market acquisition generated goodwill item is usually better than an in-house generated goodwill item.

Cheers.


----------



## It's Snake Pliskin (23 May 2005)

*Re: Patrick Corporation (PRK)*



			
				Snake Pliskin said:
			
		

> Do you think Patrick is undervalued at his stage?
> How much of an effect does Virgin have on this stock?




This is not a solicitation for financial advice! 

basically haven't been following the stock just curious.


----------



## Investor (23 May 2005)

*Re: Patrick Corporation (PRK)*



			
				Snake Pliskin said:
			
		

> .......basically haven't been following the stock just curious.




Patrick Corporation operates transportation and logistics assets, with Virgin Blue and Pacific National its most significant investments. PRK has Port operations supplying stevedoring services in 14 ports around Australia and also operates Patrick Autocare (car handling and distribution business), Cargolink (cargo storage and handling), and Liberty Cargo (freight forwarding, customs, quarantine and cartage). Each division contributes about a third of earnings.

PRK has achieved strong earnings growth in recent years. This is largely due to the reforms introduced in PRK's Stevedores operations, in addition to taking large stakes in strategic acquisitions like Virgin Blue (52%) and Pacific National (50%). PRK looks positive on a three year plus horizon. Its capacity expansion in Ports and further cost rundowns in Rail should stand the company in good stead, capacity-wise, for at least 15 years.

Consensus P/E (from 9 brokers) FY 05 is 19.1 and FY 06 is 17. 

Deducting non recurring expenditure items and amortisation of goodwill (a non cash accounting entry that is soon to be defunct under IFRS), P/E FY 05 is 15.9 and FY 06 is 14.

PRK has the significant advantage of a very strong CEO (a man who took on the waterfront union and won, doing the whole country a big favour by doubling the productivity level, which remains far short of Singapore ports, which is world's best practice) who focus on long term ROE and ignore market analysts who focus on short term SP movements.

Warning: This post is not investment advice. All equity investments carry risks.


----------



## ob1kenobi (24 May 2005)

*Re: Patrick Corporation (PRK)*



			
				Investor said:
			
		

> Patrick Corporation operates transportation and logistics assets, with Virgin Blue and Pacific National its most significant investments. PRK has Port operations supplying stevedoring services in 14 ports around Australia and also operates Patrick Autocare (car handling and distribution business), Cargolink (cargo storage and handling), and Liberty Cargo (freight forwarding, customs, quarantine and cartage). Each division contributes about a third of earnings.
> 
> PRK has achieved strong earnings growth in recent years. This is largely due to the reforms introduced in PRK's Stevedores operations, in addition to taking large stakes in strategic acquisitions like Virgin Blue (52%) and Pacific National (50%). PRK looks positive on a three year plus horizon. Its capacity expansion in Ports and further cost rundowns in Rail should stand the company in good stead, capacity-wise, for at least 15 years.
> 
> ...




It's still on my watch list. You're right it looks to be good long term, not as convinced about it short term. Nonetheless it has more pluses than minuses. Lets see where it goes.

 
__________
This is merely my opinion and does not constitute financial advice. When considering your financial objectives, please consult a suitably qualified and licenced professional.


----------



## Investor (29 May 2005)

*Re: Patrick Corporation (PRK)*



			
				Investor said:
			
		

> ... later I will outline the forecasts for air passenger numbers for the next few years, from the BRW.....




In BRW 28/4/05, "Within Australia, the number of domestic paying passenger kilometres flown trebled from 10 billion passenger kilometres in 1990 to 29.4 billion in 2000, and could nudge 45 billion or better by 2010.

In terms of international flights in and out of Australia, growth has been less spectacular, but is still strong. Australia had 4.6 million arrivals and departures in 1990 and 8.7 million in 2000.

In 2005, the numbers have climbed to over 10 million and could surpass 13 million by the end of the decade.

Real growth in domestic and international travel are estimated at 3.2% p.a. and 4.7% p.a. respectively, over the next 5 years."


----------



## RichKid (14 June 2005)

*Re: Patrick Corporation (PRK)*

PRK has broken through an inverse H&S neckline imo. Three up days in a row and gapped today. Might be the start of a little run up to $6. Will it break through on momentum?? I reckon it will, volume needs to be watched though as it could easily retrace to retest the neckline. A close above $6 will provide a nice entry with near support imo. I might buy more at that point.


----------



## RichKid (15 June 2005)

*Re: Patrick Corporation (PRK)*

I just noticed after today's close that the price action has hit the recent dowtrend line, so if it keeps going up that'll be further confirmation of a bullish run. Could very well consolidate for a bit at these higher levels before making that final dash to just above $6 where there is a lot of congestion. on the other hand  a solid bump away from the trend line is going to make this look quite weak, especially if it gaps down tomorrow.


----------



## RichKid (17 June 2005)

*Re: Patrick Corporation (PRK)*

Here's an updated chart of PRK, retesting neckline atm. Crucial time now, good volume but need accumulation days. I'm exiting if this neckline fails. Problem with big co's is they may get caught up in a general market downturn, especially at these levels for the allords. A safer entry would have been that initial bounce off the longterm uptrend line (where the Head is). Also realised after buying that that recent downtrend resistance line has not been breached. Wished I'd spotted it all sooner, shows how the mind can ignore negatives when it is bullish on a stock. Live and learn, tight stops may get me out of this in time, unless the price continues up.

Any views from the techheads out there?


----------



## RichKid (17 June 2005)

*Re: Patrick Corporation (PRK)*

Long term chart, funny how the lines move around in different timeframes. Should really be the same highs and same lows touching the trendline.


----------



## Joe Blow (17 June 2005)

*Re: Patrick Corporation (PRK)*

Finished on its high for the day at $5.95 - up another 1.2% - although volume was a little lighter than usual.

$6 looks to be a crucial level for PRK, it will be interesting to see if it can sustain this upward momentum next week.


----------



## RichKid (17 June 2005)

*Re: Patrick Corporation (PRK)*



			
				Joe Blow said:
			
		

> Finished on its high for the day at $5.95 - up another 1.2% - although volume was a little lighter than usual.
> 
> $6 looks to be a crucial level for PRK, it will be interesting to see if it can sustain this upward momentum next week.




Yep Joe, that's a nice finish and $6 is nearby, more volume would have been nice, maybe a suggestion that the sellers are holding on. Could go sideways, every cent makes a big statement when it's this close to breaking that downtrend. Still has to beat it convincingly.

BTW, for those following my trade I forgot to mention that I bought at 5.62. Again, in hindsight, I should have waited for a safer trigger (as I'm doing now) but my stop was nearby so I'm glad I've been able to move it up. PRK is volatile though and could easily gap down so I'll be keeping a close eye on things.

I'll be happy to hear critiques of my trade from a TA or Money mgmt point of view from observers or holders. This is a medium risk stock for me so a bit more of a position than with a speccy.


----------



## Joe Blow (17 June 2005)

*Re: Patrick Corporation (PRK)*



			
				RichKid said:
			
		

> Yep Joe, that's a nice finish and $6 is nearby, more volume would have been nice, maybe a suggestion that the sellers are holding on.




RK, also interesting about today's trading in PRK is that the last trade at 3:59pm was actually at $5.91, and when everything settled at 4:05pm it was up 4 cents and that volume (around 212,000 shares) accounted for around 15% of the entire days trading.

An interesting finish indeed.


----------



## RichKid (19 June 2005)

*Re: Patrick Corporation (PRK)*



			
				Joe Blow said:
			
		

> RK, also interesting about today's trading in PRK is that the last trade at 3:59pm was actually at $5.91, and when everything settled at 4:05pm it was up 4 cents and that volume (around 212,000 shares) accounted for around 15% of the entire days trading.
> 
> An interesting finish indeed.





Always nice to see the buying at the end as that's supposed to be when the smart money comes in but maybe it's just foreign buyers (or do they buy before open??). We'll soon know how this is going.

Okay, I'm about to state some very specific figures for this PRK trade, some may be stated already so just check my charts for confirmation.

I noticed the retest of recent uptrend, retest was characterised by a countertrend which has reversed forming a H&S pattern (see charts). I noticed price compressing and bought at 5.62 on Tuesday 7 June at what appeared to be the top of the final shoulder in an inverse H&S.  At that time I hadn't noticed the downtrend resistance line (see my charts again). My initial stop was based on fibonnaci lines and a potential pullback from the short term uptrend being a 61.8 retracement (at just below 5.37c) from the previous week's high (circa 5.77). Stop was exit on close at 5.35c as that would mean the H&S pattern has failed. I would then wait for a retest of the uptrend support again before entering. 
Reward target was previous high (a bit arbitrary) at 6.90 with RRR being 4.75. (22.75% return/4.8% loss). Loss is less than 1.5% of total capital. The ability to place the stop near some uptrend support was what made me enter with more confidence. Position size was full parcel for a medium volatility bluechip (my own classification). So more money in trade than for a speccy but less than for a slow bluechip.

My stop is now higher at 5.84, sell on close. Maybe I should just state this all in my first chart in future to make it easier to follow.


----------



## RichKid (19 June 2005)

*Re: Patrick Corporation (PRK)*

Here's the figures on a chart of PRK for ease of reference, this sure takes some time to post, hope the figures make sense. Let me know if I've made any errors please. Hope this helps anyone who's interested, note my errors.


----------



## RichKid (20 June 2005)

*Re: Patrick Corporation (PRK)*

Another chart of PRK, noticed an important long term horizontal support/resistance line near the recent price action. Ideally this is where I would have bought as the downtrend resistance and neckline have been pierced at this point. Volume is the only missing element imo, might be the prelude to a strong move (in either direction).


----------



## RichKid (24 June 2005)

*Re: Patrick Corporation (PRK)*

Well, the stop was well and truly triggered! Gapped down past the trailing stop, had to sell at my entry price (5.62), hence a loss (cost of brokerage). It broke down off a bearish wedge a few days ago, target should be base of wedge from what I recall of measured moves. I didn't sell on the break of the wedge as sometimes it's a false signal and it moves up rapidly after that, anyone think different? Certainly hard to predict when a stock will gap down. Next entry may be triggered soon, knowing my luck it may gap UP tomorrow!! 

Anyway, the positive is that I followed the plan, that's the most important thing.

This is a well known stock and quite popular- am I the only one interested in it on ASF (apart from Joe)?


----------



## GreatPig (24 June 2005)

*Re: Patrick Corporation (PRK)*

RichKid,

You want to trade triggered-stop stories? 

At least I've still got some profit, having bought in at $1.245. I was hoping that tiny triangle that was forming would be a continuation one. 

GP


----------



## RichKid (24 June 2005)

*Re: Patrick Corporation (PRK)*



			
				GreatPig said:
			
		

> RichKid,
> 
> You want to trade triggered-stop stories?
> 
> ...




Hi GP,
Let's hope we don't have many more of em! Clearly these things happen often with the more volatile stocks. Let's see what PRK does with that gap it just opened up. I notice your little baby VPG has had some very volatile days too. I guess we both knew what we were getting into with the recent price action. Good luck with the next one, keep an eye here in case I re-enter PRK.


----------



## Joe Blow (14 July 2005)

*Re: Patrick Corporation (PRK)*

Seems to be just holding onto support at the $5.50 mark.

I'm watching PRK again for a possible re-entry. I'll be watching for some accumulation at these levels at or above $5.50 and then a bit of forward momentum.

Any thoughts from PRK followers?


----------



## RichKid (14 July 2005)

*Re: Patrick Corporation (PRK)*



			
				Joe Blow said:
			
		

> Seems to be just holding onto support at the $5.50 mark.
> 
> I'm watching PRK again for a possible re-entry. I'll be watching for some accumulation at these levels at or above $5.50 and then a bit of forward momentum.
> 
> Any thoughts from PRK followers?




Hi Joe,
I haven't got a signal to enter yet, basically watching the uptrend line. Not very bullish about it yet, see posts 20 & 25 for the long term uptrend line I drew, I would post my stop just below it if I was to enter now. But that's just me, not too familiar with PRK, only became a serious fan this year. 

I expect a market top in the XJO soon and expect that to affect PRK so we may see the end of the multi-year uptrend. We are still in a short term downtrend imo. Long term I like this stock's fundamentals but we may be in for a bit of a volatility this year.

(PS: Note that the longterm trend line could be drawn lower (See post 20) to catch that green bar that I drew through (rather than under/touching) around the middle of the chart. That would bring support to around $5 or below).


----------



## RichKid (19 August 2005)

*Re: Patrick Corporation (PRK)*

What drama in just two days! A big fall following the result and then a huge gain today after the Toll Holdings takeover rumour mill re-ignited.

Does anyone that follows these two have any thoughts? Saw news reports saying Toll will want to sell off Virgin if it wins. Others say Toll will concentrate on Asian acquisitions and will be wary of competition issues preventing the merger.


----------



## pokerset (20 August 2005)

*Re: Patrick Corporation (PRK)*

A report in the age said Singapore airlines denied they want the airline... But i also read they could be intersted in the airline to aquire their access to the USA routes.. So looks like a win win situation..!~


----------



## Julia (22 August 2005)

*Re: Patrick Corporation (PRK)*

Will ASIC be taking a look at the dramatic buying and consequent rise in SP PRIOR to announcement of Toll's takeover bid just this morning?

Chris Corrigan doesn't seem the type to just lie down on this takeover offer.



Julia


----------



## TjamesX (22 August 2005)

*Re: Patrick Corporation (PRK)*

I'm pretty sure the significant rise would have been Toll buying on the market to get as larger pre bid stake as it could get...


----------



## pokerset (22 August 2005)

*Re: Patrick Corporation (PRK)*

Prices in Patrick and Toll went haywire today.. so much for the original takeover offer.. hehe


----------



## doctorj (24 August 2005)

*Re: Patrick Corporation (PRK)*

Heard a good story today that a London fund manager had been contacting Australian brokers asking about the Toll/Patrick deal up to a month before it was announced to the market.  Makes you wonder if there is such a thing as a level playing field, doesn't it?


----------



## RichKid (2 September 2005)

*Re: Patrick Corporation (PRK)*

Okay folks, as you can see from some of my earlier posts I missed out on this one but I'm revisiting it.

This is just the start of a bidding war imho. With infrastructure the flavour of the month and PRK owning some gems I think we'll see some nice corporate exchanges in the next few months. I'm trying to keep track of where things are so will post some stories to get a grounding. I'm looking to get in on the action for the next run up.



> *
> Little's Patrick bid takes toll*
> From:  By Terry McCrann
> September 02, 2005
> ...






> *CSFB Raises Patrick Target Price To A$7.37*
> 
> Thursday, September 01, 2005 7:01:47 PM ET
> Dow Jones Newswires
> ...


----------



## RichKid (2 September 2005)

*Re: Patrick Corporation (PRK)*

Interesting interview, as the WMC affair showed it's only just started. With lots of infrastructure players in the market this could take some time. If you don't want to read the transcript you can watch the video via the link at the foot of the extract.



> *
> Pair in transport battle*
> Date : 28/08/2005
> Reporter: Stephen Long
> ...


----------



## RichKid (2 September 2005)

*Re: Patrick Corporation (PRK)*

The basics of the first offer below, PRK sought clarification today.



> Analysts see Toll-Patrick breakdown
> SMH September 2, 2005 - 6:25PM
> 
> ......Meanwhile, Patrick on Friday asked Toll to clarify whether or not its proposed in specie distribution of Virgin Blue shares formed consideration as part of its takeover offer or whether it was simply a statement of Toll's future intentions.
> ...


----------



## RichKid (15 September 2005)

*Re: Patrick Corporation (PRK)*

Patrick lower again today, some news on the current situation: http://www.smh.com.au/news/business/patrick-threatens-rail-breakup/2005/09/14/1126377373408.html

TOL bidder's statement due by tomorrow as well. I'm waiting for PRK to recover to above $7. Although Little says no one else is interested in bidding for PRK, with mining booms normally lasting years and years there is bound to be someone with an eye on essential infrastructure assets.


----------



## RichKid (15 September 2005)

*Re: Patrick Corporation (PRK)*

Okay, bidder statement is out, also another angle on getting control. 

I was wondering why I'm the only one keeping this thread going, aren't takeovers normally a hot topic? I reckon it's because things are quiet after the initial flurry in a takeover (similar to WMC), then bit by bit it hots up and everyone is interested again. Kinda like the first stage of an uptrend, very few people know intitially and then everyone knows.

NOTE: I hold PRK.



> CBA Holds Key To TOL's PRK Takeover
> 
> Monday, August 22, 2005 8:32:40 PM ET
> Dow Jones Newswires 1016 [Dow Jones]
> ...


----------



## RichKid (15 September 2005)

*Re: Patrick Corporation (PRK)*

A great article summarising the state of play, looks like TOL will hang around on the board if it can't take complete control so I reckon this bid is going higher as Little clearly wants PRK, even at the cost of having regular stoushes with Corrigan, but that may just be a tactic. My only concern is the ACCC's take on things and how it'll affect it. So much uncertainty proves why there is never a truly safe investment. Apparently the cost savings to TOL have been deliberately underestimated so that TOL can justify a lower bid.



> *Toll expects to join top 30*
> 15 Sep 2005 17:31 AAP
> (http://afr.com/articles/2005/09/15/1126750069914.html)
> 
> ...


----------



## RichKid (16 September 2005)

*Re: Patrick Corporation (PRK)*



> CSFB Says Switch To Patrick From Toll
> 
> Thursday, September 15, 2005 6:16:43 PM ET
> Dow Jones Newswires
> ...




A chart showing the gap is below, gaps love to be filled and with a recent pivot I think the dowtrend is now reversing, consolidation at the very least imo. The uppermost horizontal line around $6.87 is the previous all time high, I expect this to climb above it eventually. This imho is a low risk trade provided the stop is very tight, potential for very high returns if the market gets excited, otherwise just a small profit judging by the bid figures going around (assuming no one out bids TOLL).

I get the impression the analysts are increasing the forecasts for both TOL and PRK so that the respective valuations will drive the bid price higher (as bid constitutes a portion of TOL's sp and because PRK says it is worth more in the future so TOL should pay more).


----------



## RichKid (6 October 2005)

*Re: Patrick Corporation (PRK)*

PRK lower again over the week, although an up day today closing at 6.60 from memory. This seems to be a level at which it finds support even when the rest of the market is in a downspin.


----------



## RichKid (4 January 2006)

*Re: Patrick Corporation (PRK)*

Been awhile since this was updated, PRK near all time highs but no volume worth noting, need another week or so probably to get the holiday laziness out of the way.


----------



## trader (19 January 2006)

*Re: Patrick Corporation (PRK)*

Since there is no takeover anymore share price should drop back to $6.00
but then again rail fright monopoly is in a mess too, so maybe share value
is less than $ 5.00 . But it will take the market awhile to go there.


----------



## RichKid (6 October 2006)

This thread is now closed due to the takeover of Patrick by Toll Holdings.


----------

