# CPU - Computershare Limited



## bonkers (3 November 2005)

Heavy volume on Wednesday 2/11/05


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## Ken (22 October 2007)

I am suprised there hasnt been more on computershare.

They have had a cracking run over the last 5 years.

Majority of there earnings are in US dollars but bell potters says they are oversold and has recommended them to his clients under $9. They are down close to 25% from there highs and are expecting a 17% increase in profits in US dollars, but that equates to just 3% in aussie.....

For information on his interview see www.brr.com.au


And listen to the 9:55 am broker wrap.


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## michael_selway (22 October 2007)

Ken said:


> I am suprised there hasnt been more on computershare.
> 
> They have had a cracking run over the last 5 years.
> 
> ...




Hm maybe it has run too hard in the past

*Earnings and Dividends Forecast (cents per share) 
2007 2008 2009 2010 
EPS 43.1 48.0 53.6 58.8 
DPS 17.0 19.7 21.8 22.8 *

thx

MS


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## Ken (22 October 2007)

To get into the broker wrap audio you go to www.brr.com.au

Put the following the search bar.

*5BRR*


No from here you can click on the days you want to listen to.

I always listen to Atul-lee-lee he is a genius. On a Friday afternoon at 4:30.

He talked about higher US currency and companies like Newscopr, MIG, ALL, and CSL really struggling.

Worth listening to.

Atul made me a lot of money during August 10 when he eased my fears on the credit crunch.


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## Ken (22 October 2007)

I just thought i would post the info tech index vs the CPU computer share price.

As your can see CPU is basically the info tech index. So if your bullish in info tech stocks then CPU is your best leveraged stock to that particular index.  They follow each other and have done for the past 5 years.


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## Porper (10 November 2007)

Ken said:


> I just thought i would post the info tech index vs the CPU computer share price.
> 
> As your can see CPU is basically the info tech index. So if your bullish in info tech stocks then CPU is your best leveraged stock to that particular index.  They follow each other and have done for the past 5 years.




A bit of a turnaround in this stock yesterday.

I was short and doing ok until the surge, so got stopped out, but what is interesting is the island reversal followed by high volume. 

The same happened 12 or so bars ago but this wasn't accompanied by the volume increase.

Not sure if there was some news, will be interesting to see how it goes in the next few days.

I'll be looking for a slight retrace to get interested as the risk reward isn't good enough.


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## michael_selway (10 November 2007)

Porper said:


> A bit of a turnaround in this stock yesterday.
> 
> I was short and doing ok until the surge, so got stopped out, but what is interesting is the island reversal followed by high volume.
> 
> ...




Its not bad

*Earnings and Dividends Forecast (cents per share) 
2007 2008 2009 2010 
EPS 43.1 47.8 52.5 58.4 
DPS 20.0 19.2 21.0 22.4 *

thx

MS



> Date: 23/10/2007
> Author: Eli Greenblat
> Source: The Australian Financial Review --- Page: 51
> An acquisition announcement by Computershare failed to gain investor support on22 October 2007. Announcing the purchase of Administar Services Group, whichwill be earnings per share neutral in 2007-08, the shares fell $A0.17 to $A8.78.Most of Computershare's earnings are generated offshore, as highlighted byits August 2007 report in US dollars. The financial services and share registryfirm increased earnings 71.4 per cent to $US233.8 million in 2006-07 and revenuerose 17.1 per cent to $US1.4 billion


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## So_Cynical (10 November 2007)

I'm selling Monday as im back in small profit territory.

Talk about picking the wrong share to make a quick buck at 
the bottom of the correction.


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## So_Cynical (3 February 2008)

In again at 7.75 just to cheap and couldn't help myself

CPU is prob a good "in and out" share to hold in these volatile times.


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## chilliaa (4 February 2008)

So_Cynical said:


> In again at 7.75 just to cheap and couldn't help myself
> 
> CPU is prob a good "in and out" share to hold in these volatile times.




Im not a trader so cant even start to give advice from a trading point of view. But with the recent correction i have been buying CPU and it now comprises my largest holding.
From a fundamental view point i think its very attractive. Here is a brief explanation why:
15yr odd EPS growth with the exception of 2003.
10 yr yearly average PE range 21 to 80, yet expected June 08 yr end PE of only around 15
In December 07 upgraded its anticipated earnings forecast (which seems to have been disregarded by the market with the current volatility).
At these prices the price is the same as around March/April 2006.
10yr/5yr EPS growth have all been good.
LOW debt.

This is definately a buy and hold stock in my opinion.


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## ROE (17 August 2008)

What's up with CPU buying ABS childcare voucher business.. This seem weird
and worse still they pay 90M pound for it... 
same price ABS bought in 2006 ... ABS is in trouble and up for asset sale
why did CPU pay full price for this business and ABS probably over pay for this business in 2006 at the height of the bull ... man I can feel pain coming to CPU in the near future. 

Sell out come back later 

do CPU management have shares in ABS ? that is the question


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## cbacamden (26 November 2008)

Any interest still in CPU ?

I can see an upside at these prices

Anyone else currently holding ? or watching


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## So_Cynical (26 November 2008)

cbacamden said:


> Any interest still in CPU ?
> 
> I can see an upside at these prices
> 
> Anyone else currently holding ? or watching




Always watching as i still have my profit in from my last CPU adventure, 
normally id be saying its a bargain at under $7 - but all this negativity 
has finally gotten to me.

What worry's me a little is just how well CPU has held up over the last 6 
months when compared to just about everything else...perhaps this is the 
SP adjustment CPU had to have.

Also CPU tends to spike down and then turn around pretty quickly...now
the SP seems to be happy to go sideways.

:dunno:


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## SoBadAtTrading (26 November 2008)

cbacamden said:


> Any interest still in CPU ?
> 
> I can see an upside at these prices
> 
> Anyone else currently holding ? or watching





It's Debt/Equity ratio of 120.0% is a big concern. Plus hasn't it just bought the UK childcare business from ABC recently which may not be very profitable.


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## So_Cynical (26 November 2008)

SoBadAtTrading said:


> hasn't it just bought the UK childcare business from ABC recently which may not be very profitable.




No it acquired Busy Bees Childcare Vouchers Limited.

Not childcare centers  

http://corporate.computershare.com/...ition of Busy Bees Childcare Vouchers Ltd.pdf

_BBCV deals with over 12,000 organisations, providing around 100,000 working 
parents with childcare vouchers each month. Computershare is acquiring the business 
from ABC Learning Limited, the ASX listed childcare operator._

Didnt help ABC much and i doubt it will do much for CPU.


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## matty77 (11 August 2010)

Interesting day...

buying opportunity? What do people think?

I do not hold, but have been wathcing for ages, down 25% since I put on my watch list.


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## skc (11 August 2010)

matty77 said:


> Interesting day...
> 
> buying opportunity? What do people think?
> 
> I do not hold, but have been wathcing for ages, down 25% since I put on my watch list.




EPS this year is 53.05c, which put them at a PE of ~16.8 (based on $8.90 share price). But management forecast 5-10% fall in EPS next year (so ~49c), which means a forward PE of 18. The average PE of the sector according to Comsec is 10.9. Although CPU has historically traded at a higher PE multiple to its peers, that premium seems to be falling as the market prices in less and less growth.

Computershare relies on market activities - trading volume as well as new floats, captial raising, takeover etc. In a ranging market those activity levels may be lower. So CPU is a buying opportunity only if you can identify growth opportunities to support a high PE. They have expanded overseas in recent years so there may be potentials there.

On the technical side - it's fallen right onto the 61.8% retracement of the last leg up, and decent support zone at $8.5. Wouldn't surprise me to see may be some sort of bounce (overall market pending) to half fill today's gap over the next week.


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## So_Cynical (11 August 2010)

matty77 said:


> Interesting day...
> 
> buying opportunity? What do people think?
> 
> I do not hold, but have been wathcing for ages, down 25% since I put on my watch list.




If i had money id be in like Flynn..i actually had CPU short listed last week for a re-entry at about $10.20 but didn't think it was cheap enough so moved on and thus dodged a bullet, Lets hope it don't rally to quickly so i can exit something and get in at under $9


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## So_Cynical (10 February 2011)

So_Cynical said:


> If i had money id be in like Flynn..i actually had CPU short listed last week for a re-entry at about $10.20 but didn't think it was cheap enough so moved on and thus dodged a bullet, Lets hope it don't rally to quickly so i can exit something and get in at under $9




Last edited by prawn_86; 11th-August-2010 at 09:30 PM. Reason: Removed unsubstantiated price target 

Hey i just noticed that edit prawn : ill PM you a "i told you so" in a few years time when CPU achieves that particularly ambitious price target of mine. 

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

Anyway CPU spiking down yesterday and today coming within 9 cents of my low ball buy order  i live in hope of the US having a bit of a tank down tonight so i can get filled tomorrow.


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## So_Cynical (14 February 2011)

I just couldn't help myself today and moved my buy order up to $9.59 in the early arvo and got filled ...CPU is now my single largest holding making up 11.8% of my total portfolio, today's entry is also my largest ever ($) buy, so a real punt for me..have to say im very confident the SP will rally from here, CPU just never goes sideways for long.

The recent fall in profit was attributed to a lack of activity in global markets and now we are seeing increased activity...still a long way to go to get back to the big volumes of the last bull but eventually it will come.

CPU is a must have portfolio stock for me, a core holding so i just couldn't pass up this chance to re-enter for my 4th time in 4 years....i expect my 100% success rate with CPU to continue, im very hopeful of being out of this trade before May...i have a very high confidence level with this stock.


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## skc (15 February 2011)

So_Cynical said:


> I just couldn't help myself today and moved my buy order up to $9.59 in the early arvo and got filled ...CPU is now my single largest holding making up 11.8% of my total portfolio, today's entry is also my largest ever ($) buy, so a real punt for me..have to say im very confident the SP will rally from here, CPU just never goes sideways for long.
> 
> The recent fall in profit was attributed to a lack of activity in global markets and now we are seeing increased activity...still a long way to go to get back to the big volumes of the last bull but eventually it will come.
> 
> CPU is a must have portfolio stock for me, a core holding so i just couldn't pass up this chance to re-enter for my 4th time in 4 years....i expect my 100% success rate with CPU to continue, im very hopeful of being out of this trade before May...i have a very high confidence level with this stock.




Why the confidence? Would you show some valuation? Or technical analysis?

Here's a piece from the business spectator on CPU...

http://www.businessspectator.com.au...-Crosby-pd20110210-DXDQ6?OpenDocument&src=spb


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## So_Cynical (15 February 2011)

skc said:


> Here's a piece from the business spectator on CPU...
> 
> http://www.businessspectator.com.au...-Crosby-pd20110210-DXDQ6?OpenDocument&src=spb




Thanks for the link...it was an interesting read, CPU really is a complex business...i liked the bit about running out of world. 



skc said:


> Why the confidence? Would you show some valuation? Or technical analysis?




I used the word confidence because i really do have confidence in my ability to recognise a trading opportunity in CPU..this is my 4th buy over the last 4 years, ill bang up a chart to show you what i mean...chart shows that i have brought into 3 of the last 8 substantial bottoms (ignoring latest buy) so how can i not have confidence?, every time i put money into CPU i make money.

I would of brought the last bottom to but i was fully invested...and as usual the CPU SP didn't stand still for long, as you may have figured out by now im not one for detailed valuations or TA, im a punter and im very happy to jump onto CPU at the price i did.

My success in CPU was really the guts/genesis of my new trading plan..CPU was the first stock i successfully averaged down into and the first stock i ever left profit in...in fact im still holding the profit from my last trade in Feb/Mar 09. 
~


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## skc (15 February 2011)

So_Cynical said:


> Thanks for the link...it was an interesting read, CPU really is a complex business...i liked the bit about running out of world.
> 
> I used the word confidence because i really do have confidence in my ability to recognise a trading opportunity in CPU..this is my 4th buy over the last 4 years, ill bang up a chart to show you what i mean...chart shows that i have brought into 3 of the last 8 substantial bottoms (ignoring latest buy) so how can i not have confidence?, every time i put money into CPU i make money.




I think CPU is looking not too great fundamentally or technically. But who knows. Good luck with the punt.


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## ChaoSI (5 April 2011)

just straight from Comsec

_"Computershare Limited (ASX:CPU) has agreed to purchase Servizio Titoli SpA from the London Stock 
Exchange Group PLC. The acquisition is expected to complete in mid May following satisfaction of various 
formal conditions, including finalisation of audited accounts for the year to 31 March 2011. The 
transaction values the Servizio Titoli business at 30 million Euros plus an amount of up to 2.4 million Euros
for the net cash balance as at completion._


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## So_Cynical (5 April 2011)

ChaoSI said:


> just straight from Comsec
> 
> _"Computershare Limited (ASX:CPU) has agreed to purchase Servizio Titoli SpA from the London Stock
> Exchange Group PLC. The acquisition is expected to complete in mid May following satisfaction of various
> ...




The market seemed to like the ann, CPU up a little over 2% today and touching 9.54 intra day...another couple a days or next week and my trade will be in the money.


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## ChaoSI (7 April 2011)

So_Cynical said:


> The market seemed to like the ann, CPU up a little over 2% today and touching 9.54 intra day...another couple a days or next week and my trade will be in the money.




hahahaha likewise.. didn't have lots to put in so i'll be in the money in another 20 points ..... but hey ... mid may take over right?

if the gods smile on me then it'll go up .... right ?


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## ChaoSI (7 April 2011)

i've been thinking there seems to be a good amount of uncertainty with this share...


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## So_Cynical (7 April 2011)

ChaoSI said:


> i've been thinking there seems to be a good amount of uncertainty with this share...




Its a big complex multi currency business so i think that = uncertainty for some people, the profitability and soundness of the business is by no means uncertain IMO...this stock never goes sideways for long and will break one way or the other at some point in the not to distant future.


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## ChaoSI (8 April 2011)

So_Cynical said:


> Its a big complex multi currency business so i think that = uncertainty for some people, the profitability and soundness of the business is by no means uncertain IMO...this stock never goes sideways for long and will break one way or the other at some point in the not to distant future.




hmmm well i'd love it to break upwards of course 
fell a bit yesterday.... 
takeovers are usually a good thing right? for sp i mean...
whether they're being taken over or taking over another company ?

i just wanted somebody's opinion on this...
if i'm looking to hold this until the takeover happens 1 month, but the SP hits my stop point before that do I sell based on the fact that it hit my stop or hold with the view of ignoring everything but the most catastrophic until my desired time period is up ?


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## So_Cynical (8 April 2011)

ChaoSI said:


> hmmm well i'd love it to break upwards of course
> fell a bit yesterday....
> takeovers are usually a good thing right? for sp i mean...
> whether they're being taken over or taking over another company ?
> ...




The CPU chart clearly shows the volatility of this stock, CPU can move up or down 3 or 5% over the course of a typical week and sometimes twice that range over a month or so...a bit of a look over the CPU announcements over the last 4/5 years shows that CPU has been actively growing the business by acquisition...small take overs are pretty much irrelevant to the SP.

Selling at stop points (a certain price) is an essential part of the discipline of trend following so if your not "trend following" then selling at a stop point in a stock like CPU could very well leave you looking a little silly in a few weeks/months time....perhaps you need to have a bit of a think about why you have a stop point? what are you wanting to achieve with a stop etc.


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## ChaoSI (8 April 2011)

So_Cynical said:


> The CPU chart clearly shows the volatility of this stock, CPU can move up or down 3 or 5% over the course of a typical week and sometimes twice that range over a month or so...a bit of a look over the CPU announcements over the last 4/5 years shows that CPU has been actively growing the business by acquisition...small take overs are pretty much irrelevant to the SP.
> 
> Selling at stop points (a certain price) is an essential part of the discipline of trend following so if your not "trend following" then selling at a stop point in a stock like CPU could very well leave you looking a little silly in a few weeks/months time....perhaps you need to have a bit of a think about why you have a stop point? what are you wanting to achieve with a stop etc.





hmmm i think i see what you're getting at... so basically in this case i'm buying based on the takeover (which i've been informed probably won't do much at all .... sigh*) so really i shouldn't bother with a stop point seing as i'm waiting for the takeover to resolve with the belief that it will inrease the SP.
so because of the reasonsing behind the "buy" a stop point in this instance is .. a little silly (unless of course it goes down like lead boots) yeah ?


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## ChaoSI (28 April 2011)

so this jsut came out.. 
http://imagesignal.comsec.com.au/asxdata/20110428/pdf/01174531.pdf


can somebody explain to me what 
"The acquisition is 
expected to be management earnings per share accretive for Computershare"
means?


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## So_Cynical (28 April 2011)

ChaoSI said:


> so this jsut came out..
> http://imagesignal.comsec.com.au/asxdata/20110428/pdf/01174531.pdf
> 
> 
> ...




CPU has brought a biggish shareowner services business in the US.

http://corporate.computershare.com/...reowner Services acquisition presentation.pdf

Acquisition is Computershare's only avenue to grow the business...this purchase is a good one due to the substantial savings that will be made via synergies between the two businesses, 70 million worth flagged over the first three years.

The market certainly liked the ann with the SP up more than 8.5% intra day and 7.7% up at the close....a couple of green days ahead could see the SP break $10. :dunno: and get me out of my 4th CPU trade in 4 years with a 100% winning record...wouldn't that be nice. :cowboy:


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## ChaoSI (29 April 2011)

i'd just be happy to close my 2nd successful trade....

okay this is a huge assumption but if this "anti-trust" thing from america gets approved, then that's a good thing right? basically means that they're given the go ahead to take over this company is that it?


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## skc (29 April 2011)

ChaoSI said:


> i'd just be happy to close my 2nd successful trade....
> 
> okay this is a huge assumption but if this "anti-trust" thing from america gets approved, then that's a good thing right? basically means that they're given the go ahead to take over this company is that it?




Yes. Sometimes there may be conditions attached - like they need to sell some of the operations... 

I am surprised at the strength of CPU despite the acquisition - they managed to turn the strong $A (which really should kill their earnings in $A terms) into a strength by buying assets on the cheap. A very nice stroke imo.


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## ChaoSI (29 April 2011)

okay i realise that these questions should stay in the beginners lounge but i thought it'd be a bit out of context.

with regard to the Sp sitting on 9.68 9.69 area...
would this be due to people waiting for the outcome of the antitrust thing? and to see if there are any conditions on it? or whether it goes through at all ?


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## So_Cynical (29 April 2011)

ChaoSI said:


> okay i realise that these questions should stay in the beginners lounge but i thought it'd be a bit out of context.
> 
> with regard to the Sp sitting on 9.68 9.69 area...
> would this be due to people waiting for the outcome of the antitrust thing? and to see if there are any conditions on it? or whether it goes through at all ?




The anti trust thing and other approvals will take weeks if not months to work through....the CPU share price gyrations are really a bit of a mystery, sure you can often say the price has fallen due to XYZ or the price had risen due to ABC but really the CPU share price seems to have a bit of a 'mind of its own'

As SKC said, often the CPU SP would be seen to have responded to the USD/AUD exchange rate due to the substantial USD earnings CPU has....however this time its different, for now anyway....all i know is buying into substantial CPU share price weakness is always a good thing, always has been for me.


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## ChaoSI (2 May 2011)

So_Cynical said:


> The anti trust thing and other approvals will take weeks if not months to work through....the CPU share price gyrations are really a bit of a mystery, sure you can often say the price has fallen due to XYZ or the price had risen due to ABC but really the CPU share price seems to have a bit of a 'mind of its own'
> 
> As SKC said, often the CPU SP would be seen to have responded to the USD/AUD exchange rate due to the substantial USD earnings CPU has....however this time its different, for now anyway....all i know is buying into substantial CPU share price weakness is always a good thing, always has been for me.





thanks, 
noted *with caution* of course


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## So_Cynical (17 July 2011)

So_Cynical said:


> (14th-February-2011) I just couldn't help myself today and moved my buy order up to $9.59 in the early arvo and got filled ...CPU is now my single largest holding making up 11.8% of my total portfolio, today's entry is also my largest ever ($) buy, so a real punt for me..have to say im very confident the SP will rally from here, CPU just never goes sideways for long.
> 
> The recent fall in profit was attributed to a lack of activity in global markets and now we are seeing increased activity...still a long way to go to get back to the big volumes of the last bull but eventually it will come.
> 
> CPU is a must have portfolio stock for me, a core holding so i just couldn't pass up this chance to re-enter for my 4th time in 4 years....i expect my 100% success rate with CPU to continue,* im very hopeful of being out of this trade before May*...i have a very high confidence level with this stock.




Well so much for that trade being completed by May...perhaps May 2012. :dunno: 

Anyway i brought some more CPU on Friday @ $8.36 just had to take advantage of the continued SP weakness...i wouldn't be much of a 'low cost average' portfolio builder if i didn't take advantage of substantial SP weakness when it comes along.

I'm fully invested now so its time to just relax, do some gaming and wait for the inevitable rally....the fundamentals for CPU remain the same.


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## Wysiwyg (17 July 2011)

So_Cynical said:


> I'm fully invested now so its time to just relax, do some gaming and wait for the inevitable rally....the fundamentals for CPU remain the same.



 Nice to see the forum investors with plenty of time up their sleeves.  Oh and the probable 28c partially franked dividend per year, is that like about less than 3% return at current share price?


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## So_Cynical (17 July 2011)

Wysiwyg said:


> Nice to see the forum investors with plenty of time up their sleeves.  Oh and the probable 28c partially franked dividend per year, is that like about less than 3% return at current share price?




CPU is a crappy yield-er like so many in the top 50...i hold CPU mostly for the growth potential, when the world/US takes off again so to will CPU.


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## skc (18 July 2011)

So_Cynical said:


> CPU is a crappy yield-er like so many in the top 50...i hold CPU mostly for the growth potential, when the world/US takes off again so to will CPU.




It's been 3 months since their Mellon deal annoucnement. There's got to be some update soon on that front. Any upward momentum on positive news might provide you with a decent exit sooner than May 2012.


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## ROE (3 August 2011)

man CPU got hammered hard ... the price now start to get my attention


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## RandR (30 September 2011)

ROE said:


> man CPU got hammered hard ... the price now start to get my attention




Im going to disclose that I actually bought myself a parcel of CPU about a week ago entry price was 7.31

Id be interested in hearing your valuations and thoughts on this stock ROE.

Fundamentally I think its a good company, value wise I think i got a decent entry price (but not outstanding) and the stock has been uptrending for the last month and half now.


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## skc (30 September 2011)

RandR said:


> Im going to disclose that I actually bought myself a parcel of CPU about a week ago entry price was 7.31
> 
> Id be interested in hearing your valuations and thoughts on this stock ROE.
> 
> Fundamentally I think its a good company, value wise I think i got a decent entry price (but not outstanding) and the stock has been uptrending for the last month and half now.




Short term catalyst definitely a decision on the NY Mellon deal. Although the price rising over the last month may mean the market is pricing in a positive outcome, and good old "sell the news" will come into play. All just speculation on my part of course.

BTW with the $AUD falling by 10% CPU is in a better place earnings wise. Although the deal also just got 10% more expensive.


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## RandR (1 October 2011)

skc said:


> Short term catalyst definitely a decision on the NY Mellon deal. Although the price rising over the last month may mean the market is pricing in a positive outcome, and good old "sell the news" will come into play. All just speculation on my part of course.
> 
> BTW with the $AUD falling by 10% CPU is in a better place earnings wise. Although the deal also just got 10% more expensive.




Thanks for that SKC.

I wasnt looking at this as a currency play on the AUS/USD as there earnings seemed far too diversified to get leverage off the movement downward on the AUS dollar if commodities collapse. I believe (and its been shown in the last week) that CSL is a much much better play in that regard.

I do like the fact that there planning on using long term USD fixed debt to finance the acquisition of NY Mellon, with interest rates so low over there it should almost be free money for CPU.

If they can achieve an operating margin on NY mellon of 20% (not unreasonable I think given CPU's operating margins have been around or just above 30%) The NY Mellon deal could add about $58 million in EBIT. Based upon NY Mellon revenues of 291 million in 2010. So possibly around $40 million NPAT. So for 550 million of long term low rate USD debt its not a bad deal. Especially if they can increase revenues. Based upon my rough calculations there it would add about 7 cents EPS. (which coincidentally is about the same increase in EPS analysts are forecasting between 2011 and 2013 FY's.)

Your technical analysis is much better then mine SKC, what are your thoughts on CPU technically ?


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## So_Cynical (4 October 2011)

skc said:


> I don't really rate my technical analysis that highly but the chart is pretty obvious imo.
> 
> It's done much better than others since early Aug but still remains in a firm down trend.
> 
> ...




Quick...wrong chart, you have like 3 minutes to edit your post before its locked. 

---------

CPU will recover, fundamentally its a true Aussie, international success story.


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## skc (4 October 2011)

So_Cynical said:


> quick...wrong chart.




Indeed. Now I lost my words but the picture says it all.


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## budfox26 (4 November 2011)

*CPU - ComputerShare*

I bought into this stock around the $10 mark. Its now trading closer to the $7 mark. It was a really bad trade for me and I don't really know what's happening with the company. Should I ditch now and cut my losses?

Thanks


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## snsdmonkey (4 November 2011)

*Re: CPU - ComputerShare*

First question: why'd you buy into it?


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## ROE (4 November 2011)

*Re: CPU - ComputerShare*



budfox26 said:


> I bought into this stock around the $10 mark. Its now trading closer to the $7 mark. It was a really bad trade for me and I don't really know what's happening with the company. Should I ditch now and cut my losses?
> 
> Thanks




Cant advice on what to do but at $7 the down side is low and 
the upside is better.

CPU is a good business with very reliable earning stream so you dont have to worry
about it fall off a cliff with some shock earning down grade...

CPU activities is dependent on market action, take over, more companies listing etc
these activities generates registry activties which is CPU main business...

Once the market pick up you can see up tick in CPU earning if you prepare to wait
that long....

I'm more of a buyer at these price than a seller...


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## matty77 (7 November 2011)

yup i have recently averaged out on CPU and am now back in the green.

I hold a long term view (as in longer than 3 years) on this stock.


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## budfox26 (7 November 2011)

What do you think the price will be in 3 years matty77


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## matty77 (7 November 2011)

No idea to be honest.

The best answer I can give you is "more than it is now"


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## ROE (7 November 2011)

Own CPU for the first time During the August Panic

I just wait for each panic, then load up wonderful business at a fair price


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## RandR (7 November 2011)

ROE said:


> Own CPU for the first time During the August Panic
> 
> I just wait for each panic, then load up wonderful business at a fair price




Quite pleased with my entry at 7.31 Im seriously considering whether to take my capital back out and leave the profits in to ride free. Id like to ride this baby all the way but I just dont think its very prudent in this market, im feeling very inclined just to leave the profits in and preserve my capital back into my ubank account


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## RandR (10 November 2011)

I decided against taking profit to see if I can ride this up more. Its come back quite decently since the jump up on monday. But needs to now have a green day and form a higher high before getting more comfortable technically. Because of the uncertainty in markets worldwide, im placing a stop at 7.75 Will at least ensure I exit my position in CPU at a profit, if the SP gaps back down with the market. 

Will be interesting to see how the market reacts to there increased Debt to equity that will go up quite substantially once the NY Mellon deal is completed.

I was looking through the last FY year NY Mellon report and it appears they were achieving a 45% operating margin on the shareholder services business, If CPU can achieve those sorts of margins on the acquisition it will be a very positive deal for the company.



			
				ROE said:
			
		

> Own CPU for the first time During the August Panic
> 
> I just wait for each panic, then load up wonderful business at a fair price




Would love to hear some of your thinking on this business ROE.


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## ROE (15 November 2011)

RandR said:


> I
> Would love to hear some of your thinking on this business ROE.




I think CPU has many options for delivering EPS increase for sometimes to come.
It is  a global share registry player, so any major international company with wide range of shareholder and stock options for their employee will use Computershare
IBM, Apple etc.. will all use CPU. With the rise of China and Asian market more of these companies will make global foot print and CPU is ready to take on their business..

CPU can also take on new market like Carbon credits registry, carbon permit etc..
Mortgage Management, anything that require record keeping that ties ownership to
an asset, more countries open up to free market and stock market, CPU is ready
to tap those market..

the Mellon purchase is a perfect acquisition, going to be some massive saving there
on IT and infrastructure, CPU done this many times before like QBE so they wont have execution issues integrating new business into their infrastructure...

and the cash generation of this business is very sweet ...$500m for Mellon without taping shareholder
for more cash, it's a true test to their enduring cash generation model 

all in all very exciting time to own CPU


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## robusta (15 November 2011)

I have noticed a couple of ASX companies changing fron CPU to Link Market Services and Boardroom Pty, is this common?


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## So_Cynical (15 November 2011)

robusta said:


> I have noticed a couple of ASX companies changing fron CPU to Link Market Services and Boardroom Pty, is this common?




Common...no

There is churn in all industry's when it comes to service providers...i imagine that Link is a cheaper option because many of the bigger stocks use Link, perhaps Link do cheap deals for some larger company's.?

The Link people were very good at the Dexus AGM i attended...and the Link website has improved outa sight...as in it actually does almost everything the CPU site has done for half a decade or more.


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## ROE (16 November 2011)

Links is nothing compared to CPU, they may be able to get a few business here and there in Australia but CPU is global most global companies end up using CPU.

also business churn through registry like anything else in any industries
you lose some customers you gain some other...

as the companies get bigger and more global they tend to move to CPU..

CPU manage their employee stock options,proxy for investor all over the place...
imagine Apple and IBM with employee world wide use anything else but CPU...

plus more than 70% of CPU business will be outside Australia....

Links is a business run by private equity juice up so they can flock it off
to the market at crazy price  they are in the process of probably

offer cheap service to get more customers on board so they can fix their book
that look attractive and flock it off to the some fund managers.

these fund mangers like pretty diagrams and number ...  Myers, Collins food, Rebel sport comes to mind recently 

If you are buying a registry business out of the lot CPU is a much much better business...


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## RandR (6 December 2011)

Was just reading the agm presentation from a month or so ago. some interesting tidbits dropped.

On the positive side, the recent acquisitions look great, they are anticipating Service Works and Specialised Loan Servicing to provide about a 5c eps. (with eps of 51c thats a nice boost of about 10%)

BNY deal looks good. Should add revenues of about USD290million. (which represents just over a 1/3rd of current CPU revenues) I looked at the BNY financial statements and they claimed to be achieving about 40% operating margin on this division. If CPU can keep the margins on those revenues up anywhere near that, that particular acquistion could be a BOOM for CPU.

On the downside, CPU profits ARE being affected by the low market volumes that have been trading. Also, transactions/floats are obviously not in booming demand right now so that side of the business is not doing as well. CPU have indicated they expect 1st half earnings to be down 15% on previous year.

The SP is at a really interesting point right now, has found really strong support at the $8 level, interesting to see whether or not it will drop below or keep on bouncing off it till xmas.


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## RandR (29 December 2011)

I cant help but feel that the lessoning volumes being traded is going to be a ball and chain around CPU for a little while yet, be very interesting to see the guidance and profit announcements out around februarish. Ive taken capital out of this (at a profit) for now. But will retain the profit in to let run.


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## Nutmeg (29 February 2012)

RandR said:


> BNY deal looks good.




At over half a billion dollars, I think the BNY deal looked expensive.  Does anyone know what BNY's average 5 year ROE was?


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## pixel (20 July 2012)

Nutmeg said:


> At over half a billion dollars, I think the BNY deal looked expensive.  Does anyone know what BNY's average 5 year ROE was?




Sorry, can't help you there;
but the Market may have shared your reservations - initially.
At the end of June, I noticed some "obvious" accumulation, and when the falling trendline was broken a couple of days ago, I started to go Long.

Daily chart:




$7.67 is the new resistance that will have to give before I top up, and $7.53 will obviously have to hold (on a Closing basis).


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## Knobby22 (21 July 2012)

I agree.
Time to go long. 
The banks charts are similar as are many other companies that are not part of the mining boom or subject to consumer demand.


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## So_Cynical (22 January 2013)

So_Cynical said:


> (14th-February-2011) I just couldn't help myself today and moved my buy order up to *$9.59 in the early arvo and got filled* CPU is now my single largest holding making up 11.8% of my total portfolio, today's entry is also my largest ever ($) buy, so a real punt for me.







So_Cynical said:


> (17th-July-2011) Well so much for that trade being completed by May...*perhaps May 2012.*
> 
> Anyway *i brought some more CPU on Friday @ $8.36 *just had to take advantage of the continued SP weakness...i wouldn't be much of a 'low cost average' portfolio builder if i didn't take advantage of substantial SP weakness




 CPU had another good day today, *closing at $10.24* ~ i hold 4 parcels all in clear profit.

Never average down  never buy good stocks cheap   always take the loss  people who average down just cant admit they were wrong  never risk more than 2% of your capital in any one stock...Blah blah blah.

---

Have to admit that i entered way way to early, never imagined it would take 2 years to come good...but i knew it would.


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## prawn_86 (22 January 2013)

So_Cynical said:


> Have to admit that i entered way way to early, never imagined it would take 2 years to come good...but i knew it would.




Hi SC,

Slightly off topic but couldnt really find the correct thread for it.

For your strategy (which i do admire by the way), how would you have gone if you had just bought or averaged into the index. Obviously with the index near a 20 month high how much of an effect has that had on your performance?


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## matty77 (22 January 2013)

I too decided to average on this one, ended up being at $8.28...

Better than a loss. 

It was always long term anyway so I am not too fussed, but what do people think the short/long term outlook is for CPU?

edit: just reading previous page I already stated this ages ago! hahaha lol


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## So_Cynical (22 January 2013)

prawn_86 said:


> Hi SC,
> 
> Slightly off topic but couldnt really find the correct thread for it.
> 
> For your strategy (which i do admire by the way), how would you have gone if you had just bought or averaged into the index. Obviously with the index near a 20 month high how much of an effect has that had on your performance?




With the run up in the market almost all (not APN) my boats are rising...and that's what i always though would happen, so all according to plan, my portfolio is hitting new all time highs and that's with me taking money out to buy some real estate...its great!

I find it difficult to do a STW type comparison..to be fair i would of committed most of my funds before bottom (like i did with CPU) so i reckon i would of averaged into the ASX200 at about 4200 but could of been as high as 4300, because i did buy allot of stocks on that down leg between Feb >  June 2011.

Then was simply stuck in a heap of trades with no funds to average down, i was reduced to a trade every 3 months or so and it went on like that for over a year...so from 4200 to 4800 is 14.3% and i reckon that (had a look back at some 2011 portfolio screen shots from mid 2011) my portfolio is up about 21% and that includes divis reinvested or simply ploughed back in.

So in conclusion, the outcome would be roughly the same, perhaps i did a touch (1 > 3%) better, depending on where the lines are drawn...come to think of it, because i have so many stocks i was able to at least make some exits with profit to keep some momentum..if i was in a single stock (STW) that would not of been possible.


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## LionTurtle (13 August 2014)

How come CPU lost over 6% today?

I am trying to work out if now is a good time to buy.

so CPU do the computershare registry thing all my shares are on.. so they are not going anywhere soon.

What else are they involved in, other IT services? they also invest in stocks in different markets?


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## So_Cynical (13 August 2014)

LionTurtle said:


> How come CPU lost over 6% today?
> 
> I am trying to work out if now is a good time to buy.
> 
> ...




Do a little digging, CPU is a Global share registry, share holder services business, large exposure to the USD...big business, in the ASX50 and not in any danger of going under.


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## Miner (18 April 2015)

It is about a year since last posting was made on this thread.
CPU has been heavily recommended by Motley Fool and with A$ vs US $ ratio CPU is particularly very attractive when you calculate just 20% positive variation on income from US sources.


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## So_Cynical (18 April 2015)

Miner said:


> It is about a year since last posting was made on this thread.
> CPU has been heavily recommended by Motley Fool and with A$ vs US $ ratio CPU is particularly very attractive when you calculate just 20% positive variation on income from US sources.




CPU is also IMO a stock that is due for a big move up, just pulled up a 5 year chart and saw that CPU has been moving up over the last 3 years, back up to where it was before..due for a move up beyond the 6 year trading channel, the $12.50 to $13.50 area has been a hard nut to crack.
~


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## Miner (18 April 2015)

So_Cynical said:


> CPU is also IMO a stock that is due for a big move up, just pulled up a 5 year chart and saw that CPU has been moving up over the last 3 years, back up to where it was before..due for a move up beyond the 6 year trading channel, the $12.50 to $13.50 area has been a hard nut to crack.
> ~




So_Cynical

That was not a cynical but a very positive endorsement from you to  Motley's recommendation.
One of my small parcel buy order got executed and I was getting  nervous even after doing some calculation without any chart.  Now your chart makes a lot of sense and thanks a lot. 

Cheers


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## notting (13 August 2015)

Miner said:


> heavily recommended by Motley Fool and with A$ vs US $ ratio CPU is particularly very attractive when you calculate just 20% positive variation on income from US sources.




All well and good but you gotta actually run the business well too.



> impact of the stronger USD and the anticipated lower yields on client balances are again expected to be significant earnings headwinds. The business is also anticipating some increased costs including those associated with investments in product development and efficiency initiatives. Taking all factors into account the Company expects Management EPS for FY16 to be
> around 7.5% lower than FY15




Could have been forgiven for thinking yesterday was an over reaction and buying opp by the move.
Not so cheesy today but.
Tomorrow, yes, tomorrow.


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## pixel (11 November 2015)

LOL LOL LOL Computershare must have a stake in Australia Post!
... or a very sloppy programming crew 

I recently logged on to their website (it's secure alright, but takes ages to respond!) to set the communication options for a few new shares to email. For years, I've been using a dedicated email account for everything to do with share communication, asking for all reports to be sent to that address. As I hadn't updated quite a few new ones, I didn't bother to go through the entire portfolio, but used the "All" facility that's provided.

A few days later, the Postie brought about 100 individual letters, one for each company that I've ever owned share in, advising that they will now send all reports to that email address.


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## Miner (9 May 2016)

Miner said:


> So_Cynical
> 
> That was not a cynical but a very positive endorsement from you to  Motley's recommendation.
> One of my small parcel buy order got executed and I was getting  nervous even after doing some calculation without any chart.  Now your chart makes a lot of sense and thanks a lot.
> ...




CPU chasers and folks including SO Cynical

It has been a year since I posted on CPU. 
I noticed the share price has gone down since then and yes my portfolio on CPU has lost by 9% about since I bought. Motley Fool (I am losing faith on their recommendations now ) still keeping it a buy and Bell Potter has said sell .
I am confused as all comments by BP seem to be positive and so the presentation from CPU on MQ conference presentation following a big UK acquisition.

Could SC and other posters please comment ?
I am still holding CPU but confused now to retain or increase.


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## Triathlete (9 May 2016)

Miner said:


> CPU chasers and folks including SO Cynical
> 
> It has been a year since I posted on CPU.
> I noticed the share price has gone down since then and yes my portfolio on CPU has lost by 9% about since I bought. Motley Fool (I am losing faith on their recommendations now ) still keeping it a buy and Bell Potter has said sell .
> ...




Looking at the Fundamentals from stock doctor they do not look that good to me with 
EPS at   -5.15  June 16 
EPS at    5.45  June 17
so nothing to fire up the share price at this stage IMO.

Looking at the weekly chart show it may have bottomed on the 25/2/16 @$8.92. It
has broken through the downtrend line but I would wait until the stock makes another higher low and breaks through $10.49 if I was looking to buy in.

This is not a recommendation just my own opinion and is a very quick analysis would really need to do some more analysis on this stock to satisfy myself.


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## Triathlete (9 May 2016)

Miner said:


> So_Cynical
> 
> That was not a cynical but a very positive endorsement from you to  Motley's recommendation.
> One of my small parcel buy order got executed and I was getting  nervous even after doing some calculation without any chart.  *Now your chart makes a lot of sense and thanks a lot.*
> ...




Of course a chart is always  easy in hind sight .If we go back and take a look at the chart post #74 we can see that it was moving up within the channel which could have been a sign that the stock would continue higher.

If I was following the stock at the time I would have also used Elliot wave theory *which could have also alerted us *to the fact that there was a possible 5 wave structure up in this channel as well and would have been looking for the 3 wave correction phase once it broke through the bottom line of the channel , which is what eventually happened.

Oh hindsight is wonderful..


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## skc (9 May 2016)

Miner said:


> CPU chasers and folks including SO Cynical
> 
> It has been a year since I posted on CPU.
> I noticed the share price has gone down since then and yes my portfolio on CPU has lost by 9% about since I bought. Motley Fool (I am losing faith on their recommendations now ) still keeping it a buy and Bell Potter has said sell .
> ...




There are competing issues facing CPU (which company doesn't?)...

- It's struggling to find growth... nothing organic and not many targets to acquire. Yet it's been priced for growth (and has the perception of a growth stock) for some time. So some people are expecting a de-rating.

- Recent acquisitions didn't excite everyone. The mortgage processing business is labour intensive and lumpy so the earnings from these don't deserve the earning multiples being put on CPU (just reciting a broker report that I've read - can't remember who it was though). 

- CPU holds a lot of customer cash. With the low interest rate they are making very little returns on that cash. On on hand that's a negative and on the other hand it's a free option play on rising rates.

- Management is forecasting lower EPS so perhaps a bit early for some to start accumulating, without any evidence of turnaround as yet.

In conclusion - DYOR


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## pixel (9 May 2016)

The last year has definitely been a struggle, with the chart dominated by Lower Highs and Lower Lows.





Short-term, however, the trend could be considered as reversing. Not enough for me yet to plan any longer-term holdings, but a couple of swing trades between $9 and $10, then again $9.50 to $10.30 have turned out quite profitable.


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## Miner (10 May 2016)

Many thanks triathlete, SKC and PIXEL for your thought provoking comment on my query.
Take care


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## So_Cynical (10 May 2016)

I concur with all the comments over the last few days, CPU is struggling share price wise and that's a reflection of the reality of the business, the blockchain disruption potential is another negative.

http://www.smh.com.au/business/bank...rejects-blockchain-fears-20160428-gogua4.html

I've held since the GFC low and as it has turned out CPU has been a significant underperformer in comparison to many other ASX 50 stocks since early 2009, did sell about half my holding at around the $12.50 mark a while back, and glad i did.

Buy zone under $9.60 certainly wouldn't be selling at under $11


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## rnr (27 December 2016)

Potential for a low risk entry perhaps?


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## So_Cynical (27 December 2016)

rnr said:


> Potential for a low risk entry perhaps?
> 
> View attachment 69242





See now i would call that a high risk entry, CPU has been range bound for a decade and 13 bucks is the top of that range.


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## peter2 (28 December 2016)

That's a great setup for a short term momentum trade and who knows it may be a good one for an investor. We'll not know for some time. 

It's not a comfortable setup for "The Contrarian Averager."


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## kid hustlr (18 August 2018)

Boomed higher over earnings although admittedly a long way off its highs on the weekly. Hard to argue with the longer term trend though so may be worth keeping an eye on, especially if this market continue to grind higher


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## So_Cynical (20 August 2018)

At long last CPU finally catching up to some of the other top 50 stocks, range bound no more.


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## rnr (11 November 2018)

So_Cynical said:


> At long last CPU finally catching up to some of the other top 50 stocks, range bound no more.







Heading for another assault on the ATH?


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## peter2 (15 December 2020)

rnr said:


> Heading for another assault on the ATH?




Unfortunately for holders, no. CPU shareholders have had a few poor years. The share price and I suspect the business haven't progressed at all. Currently, price is at an interesting level, at recent highs, but below the 15.00 resistance level. Price is coiling for a move and the daily chart looks quite bullish. Target if it gets above 15.00, 17.75 and this is an acceptable RR for a short term trader.


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## Trav. (2 January 2021)

peter2 said:


> Price is coiling for a move and the daily chart looks quite bullish. Target if it gets above 15.00, 17.75 and this is an acceptable RR for a short term trader.



2 days later CPU broke through the $15 resistance level only to retrace back down to $14.59. Will we see CPU have another attempt to break the $15 resistance ?


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## Sean K (17 December 2021)

CPU flies under the radar a little as a long term Mum and Dad type stock. Nice chart since the bottom of Covid. All time high back in 2018 at just over $20 not far away. I suspect if Covid hadn't have come along it would have been here in mid 2020. Not sure of pe and whether it's a growth or income type stock.


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## peter2 (22 December 2021)

Thanks for the big picture chart. 
The daily chart looks promising for a BO-NH soon. I like the recent HL. Hope it holds.


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## Dona Ferentes (18 January 2022)

Mirrabooka has taken a stake in CPU in the last 6 months



> _Computershare was reintroduced into the portfolio in the early months of the financial year, before market interest rate expectations began to increase. It is a high-quality business that is relatively mature, but we felt that the market was mispricing the very significant benefit that even modestly higher interest rates would have on its earnings._




_"early months of the financial year," ... _around $16? Now above $20


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## Dona Ferentes (8 February 2022)

Lifted dividend to 24c, some 40% franked.

The promise of rising interest rates bodes well for Computershare, as its US Mortgage services business has remained subdued for some time, but Mr Irving said industry fundamentals were improving.

Unlike most tech companies who suffer from higher interest rates, Computershare benefits from the margin income it earns on cash held on behalf of its share registry clients, before dividends and other distributions are paid to the clients’ shareholders.

A 100 basis point increase in interest rates would generate an annualised earnings per share of US26¢ per share, the company said.

Despite the uncertain global picture, Computershare management upgraded its guidance and expects earnings before interest and taxes (less margin income) to increase by around 13 per cent compared with the 3 per cent guided in last August.


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## Dona Ferentes (9 February 2022)

and up 10% today, as high as $22.60 ... hasn't been so high for a very long time.


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## Dona Ferentes (10 November 2022)

Sean K said:


> CPU flies under the radar a little as a long term Mum and Dad type stock. Nice chart since the bottom of Covid. All time high back in 2018 at just over $20 not far away. ...



and keeps kicking goals. A beneficiary of rising interest rates

_Upgraded earnings per share growth guidance for financial 2023 to around 90 per cent as rising interest rates boost its income earned to an estimated $US800 million._
_For 2024, margin income is projected to be $US1.01 billion._
_EPS forecast is measured against 2022 full-year management earnings of US57.95¢ a share, and in constant currency terms._
_Also assumes 2023 earnings before interest and tax excluding margin income is lower against 2022 due to reduced transaction volumes, fewer events, and higher costs._
_The margin income forecast of $US800 million is $US280 million above the August forecast_.


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## Sean K (10 November 2022)

Dona Ferentes said:


> and keeps kicking goals. A beneficiary of rising interest rates
> 
> _Upgraded earnings per share growth guidance for financial 2023 to around 90 per cent as rising interest rates boost its income earned to an estimated $US800 million._
> _For 2024, margin income is projected to be $US1.01 billion._
> ...




Very nice BO. I'm sure @peter2 s system has lit up on this one.

Why am I not invested in this? (head banging emoji)


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## peter2 (10 November 2022)

Price has been bumping up against the resistance level at 26.20 - 26.40 for quite some time. There's an ascending triangle on the right side of the trading range indicating a break-out soon. Looks like the AGM has provided some news that caught the fancy of some buyers. 

The price of CPU has been a bit more volatile than I like, making a short term trade risky. However the medium term with a wider stop loss looks OK. Pretty sure that price will test the old R level before going higher.


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