# GPT - GPT Group



## gerg (3 November 2008)

Hi
I have been offered additional units in this leading REIT for 60c each. This is way below the current NTA and the same as the institutional offer.

Given GPT's recent fall from grace and heavy price falls I am somewhat sceptical about taking up this offer. However if the planned future dividend of 7.2c per unit is achieved them its a decent return for more funds invested. I am oin this basis inclined to take it up, and it will reduce my overall current cost per unit.

Its does support the groups debt reduction strategy and the market seemed happy with it given the take up by the institutions. GPT does have a quite a good suite of office and retails assets (plus some recreational and european duds)

Are there any pearls of wisdome out there with supporting or contrary views.

gerg


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## YELNATS (11 November 2008)

gerg said:


> Hi
> I have been offered additional units in this leading REIT for 60c each. This is way below the current NTA and the same as the institutional offer.
> 
> Given GPT's recent fall from grace and heavy price falls I am somewhat sceptical about taking up this offer. However if the planned future dividend of 7.2c per unit is achieved them its a decent return for more funds invested. I am oin this basis inclined to take it up, and it will reduce my overall current cost per unit.
> ...




I'm taking up my full offering at 60c each. Now selling at $1.02, that's an immediate return of 70%. Only wish I could get some more.

Note, monies have to be received by Nov 17.


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## drsmith (12 November 2008)

YELNATS said:


> Now selling at $1.02, that's an immediate return of 70%.



Now we know why.

Stockland have just dived in with a 12.7% stake in GPT at an average price of $1.07.


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## drsmith (12 November 2008)

The resultant excitement saw over 25m GPT shares trade immediately upon resumption and the share price briefly rocket to $1.44. It's good to see there's still a little irrational exuberance out there.


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## prawn_86 (12 November 2008)

Its not usual for arb situations like this to come up.

Normally the price falls to the entitlement issue price. Will be interesting to see what happens. Surely there will be selling pressure once the offer is complete


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## shadda (9 February 2009)

gday all 
 im on here.

i dont hold this stock atm but have being following it recently
i heard they raised $1.3 billion since september 08
listening on foxtel channel 602 your money 
1 day they discussed this stock and when it was .74cents /share they said it was at a 30?percent discount,  i dont know to what  but maybe the same sector.

it does have alot of debt but has some quality assets 
yesterday it was at 61cents 

would anyone have anymore info on this stock or were to get some?
free
 eg papers etc

doesnt seem like many people interested in it 
thanks Richo


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## Taltan (12 February 2009)

Hey Shadda

I've also noticed it. It has had huge volumes recently but not much news. 
As far as information goes I recommend you do your own research cause (Company Reports, General news) cause recommendations nearly always come with hidden agendas.

Personally I got on board yesterday. Unemployment is still relatively low, they raised 1.3bn back in November and they should be helped by lower interest rates. All in all much better value than residential real estate at the moment.


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## drsmith (12 February 2009)

I note that even with the proceeds of the October 2008 capital raising banked there's still a big slab of debt (~$1.3b) due to expire in 2010.

Without some asset sales and/or improved credit markets between now and then another heavily discounted capital raising could be on the cards.


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## Taltan (13 February 2009)

There are no guarantees but with Libor coming down I expect they will get their refinancing in 2010. Certainly the prevailing ASX sentiment is to sell property but I think its been overdone. Why would the banks continually shut down GPT, FKP, Stocklands, Mirvac etc whilst continuing to give residential investors no deposit loans. I concede residential property is safer but essentially both commercial and residential property values face the same variables of  unemployment and access to credit. Given GPT owns its property in Sydney and has better interest cover than most of its competitors I think the risk is worth it. At this point I should add I am NOT a financial advisor


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## dirty_harry (13 February 2009)

GPT is another excellent Australian long term conservative investment ruined (or put at severe risk) by greedy American fee-mongers. Send them all home, recpapitalise and start over. 

American CDOs - what a con - ruined Iceland a previously very nice, peaceful,  conservative wealthy country. More American bs to come.


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## drsmith (13 February 2009)

The loans of the big listed REIT's are not limited to Australian banks (home lenders). Many have big loans with overseas insitiutions. GPT is no exception.

Having reviewed the investor presentation for the October 2008 capital raising I note that GPT has two other potential financial obligations in addition to it's balance sheet debt. These are noted under Risks on page 34 of the above document.

The first is a garantee on a JV party loan of $US313 million and the second a put option write over a half share of a shopping centre. While I am interested in GPT these kind of things make me cautious about buying in now. Reassurances about the likely liability from the JV party loan are not exactly reassuring given GPT's folly with the Babcock and Brown JV.

Whatever happens the REIT sector will emerge a far less geared sector than it currently is. That is for those entities that survive.


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## Taltan (14 February 2009)

I concede you make valid points and as its down since I got on board so Mr Market agrees with you. However I will add that the govt will be forced to take steps to help save certain companies (Another reason I like Sydney CBD). Our banks were not allowed to let Centro die so why GPT? The collapse of a GPT would see Commercial property plummett and the book losses for the bankers multiplied.


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## drsmith (14 February 2009)

I have not suggested GPT will collapse but some REIT's will. Centro is obvuiously in a far worse shape than GPT having effectively collapsed in all but name only.

With GPT however I feel there are still too many uncertainties to invest now and that the prospect of a lower entry price is good. 

The wildcard though is an opportunistic predator taking a stake in the company in order to have a crack at it's better assets. Looking around though, which of the listed REIT's have the capital for such an adventure ?

Stockland moved in and that provided a short term boost for GPT but at the moment it's looking like Quinn moved too soon.


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## Taltan (15 February 2009)

Again fair points however in a bear market cheaper entry points are usually a good bet as we're all catching a falling knife. Cash still has to be parked somewhere


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## jet328 (15 February 2009)

Gerald Celente's view on commercial property
http://www.youtube.com/watch?v=9nJ7LM3iyNg

He's to the point...


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## Bushman (4 March 2009)

drsmith said:


> Now we know why.
> 
> Stockland have just dived in with a 12.7% stake in GPT at an average price of $1.07.




Stockland are seriously under water now on GPT and FKP! $0.27 per unit now. T/over? Still a premium Australian portfolio. 

If its another cap in hand equity raising (Citi reckon its in the order of $850m on the back of $350m in asset sales) then it will kill what's left of the A-REIT sector. It will be the XJO S&P Westfield sector.


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## drsmith (4 March 2009)

Swallow me knob!

$0.27 allready and I'm yet to look seriously at the latest financials.

To what extent has the BNB joint venture been written down?
To the last dollar I hope.

Where can I find the Citi article?


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## Bushman (5 March 2009)

drsmith said:


> Swallow me knob!
> 
> $0.27 allready and I'm yet to look seriously at the latest financials.
> 
> ...




It's the Citi Real Estate Handbook Feb'09. Covers what's left of the A-REITs. 


_______________________


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## vincent191 (5 March 2009)

GPT has a very desirable "land bank" especially in Sydney. During the boom time there was a severe shortage of suitable building sites, now it looks like REIT that are in distress have to sell them off at a huge discount. Only problem no one has the cash to take real advantage of the fire sale.


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## drsmith (5 March 2009)

GPT's current carrying value on the BNB joint venture is $1.16bn as noted on page 7 of the following document.

http://www.asx.com.au/asxpdf/20090227/pdf/31g9nvk05lr8qq.pdf

Balance sheet and look-through gearing are 33.7% and 46.6% respectively against covenant levels of 40% and 55%. If the BNB joint venture is written down to nil the above gearing ratios rise to 37.2% and 51.6%.

GPT has also aknowledged the need for further equity capital (underwritten DRP) in the absence of sufficient asset sales.


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## drsmith (6 March 2009)

drsmith said:


> If the BNB joint venture is written down to nil the above gearing ratios rise to 37.2% and 51.6%.



In addition to the above I have also performed a quick calculation of gearing ratio's for a 5% and 10% reduction in the value of the remaining $9.3b of it's investment portfolio.

The above gearing ratios rise to 38.8% and 53.9% for a 5% reduction and to 40.6% and 56.4% for a 10% reduction. These ratios take into account BNB JV written down to nil.

In addition to the above, other potential costs are the JV party loan garantee of $US313 million, a put option written over a half share in a shopping centre (both noted earlier) and $260m capital expenditure this year.


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## Trevor_S (11 March 2009)

Thnaks for the analysis from the good dr 

Anyone moving on this (for investment) ? I am thinking it might be time to move.  The sell down seems to have been a little overdone ?


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## Trevor_S (17 March 2009)

Ahh well, I went in a few days ago @32c.  Time will tell I guess.  The recent rise means very little, as I tend to be buy and hold.


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## skc (17 March 2009)

Check out their director Liz Nosworthy's CV. There was a more recent article that I couldn't find just now. BTW, Ventracor is suspended at the moment.

http://www.crikey.com.au/Business/2...-performed-company-director-in-Australia.html

She's also been blamed for the flooding in QLD since she's the chair of the water commission.


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## goldchopper (17 March 2009)

GMG the other leader. I'm in at 21cents. bought more at 31. Still holding. Property now will be held up by RUDD BANK. Goodman still best div yield. Even with a 20% asset write down this stock is worth 60 to 70 cents a share..


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## Trevor_S (17 March 2009)

skc said:


> Check out their director Liz Nosworthy's CV. There was a more recent article that I couldn't find just now.




This one, or something like it ?

http://business.watoday.com.au/business/shes-got-the-minus-touch-20090315-8ywr.html


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## skc (19 March 2009)

Trevor_S said:


> This one, or something like it ?
> 
> http://business.watoday.com.au/business/shes-got-the-minus-touch-20090315-8ywr.html




That's the one. I will clip and save the picture for my dart board. 

Cheers. Thank you. Xie Xie. Merci.


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## dogby (29 March 2009)

skc said:


> Check out their director Liz Nosworthy's CV.




I was thinking of investing in GPT, but a past history like that of one of its directors is enough to make me think twice.


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## ROWANROWAN (7 May 2009)

Hi
I'm new to the forum and am wondering what people think of the announcement today of GPT 's capital raising. Will this be perceived as a good move and as such what I am asking will the share price which is now on a trading halt reopen on Monday at a similar price or drop or rise dramatically due to thsi decision - thoughts gratefully received .


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## Trevor_S (19 May 2009)

Speaking of capital raisings, is this open to all those who hold scrip in GPT ? If so, why have I head nothing ? and is there a URL to d/l to an acceptance form ?


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## vincent191 (19 May 2009)

Well guys, what do you think GPT's future holds? I am hoping under the new leadership it may survive and claw back some of it's former glory when times get better. Maybe in 12 months time we will look back and say "I should have bought more when it was so cheap".

I will take up my rights issue because I believe that they hold some beautiful assets and when the recovery comes these frontline assets will be the first to appreciate. Stockland is also eyeing these jewels in the GPT crown.


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## shenglee (22 May 2009)

I received the retail entitlement offer on May 20.  Entitlements are worked out on a pro rata basis of 1 for 1.  If you have not heard yet might want to call 1800 190082 (from within Aust) or 028280 7196 (from OS)

I am thinking it would be a waste not to take this offer on.  

I was initially puzzled by this second bout of capital raising (considering they only raised capital recently), however I am now of the impression that any corporate with enough foresight realises the worst of the GFC is potentially yet to come.  
If this is so - raising capital whilst the sun is out is perhaps the best strategy.  Alternately, if the bearish outlook does not eventuate GPT would still remain in a strong position as gearing levels will drop to 25% against covenants of 40%.

Judging by the positive response from institutional investors.  I suggest there will not be a shortfall of retail investors who will also accept the .35c offer.


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## Looingforvalue (30 July 2009)

*GPT*

Anyone interested in GPT? What it could look like if it hived the B&B JV off as a separate coy with shares issued in specie to existing shareholders?

Also any thoughts about the property trusts sector? Think there is a lot of upside potential over the next 12 months, once the rally in the materials and industrial cyclicals has matured. On the investment clock, properties and property trusts run AFTER EQUITIES!


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## Ferret (1 August 2009)

Exited their B&B joint venture yesterday with a write down of $1.16 bil.

They were idiots for dumping Lend Lease amd teaming with a shonky operator like B&B.

They might be on the right track now, but I'd still prefer to trust my money to a proven smart operator like Westfield.


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## skyQuake (5 August 2009)

1.5  Billion traded today, mostly though matched orders and special broker smoke n mirrors. 
Somethings up.


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## nunthewiser (5 August 2009)

skyQuake said:


> 1.5  Billion traded today, mostly though matched orders and special broker smoke n mirrors.
> Somethings up.





yep been watching the games on it for 2 days now , definately something afoot .. thats a big chunk of the co moved today so far

some mighty large cross trades in there. a bit of a shuffle ?


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## vincent191 (5 August 2009)

4 billion GPT shares have changed hands in the last 36 hours. I repeat 4 BILLION. I wonder what is going on??
Takeover by Stockland???


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## vincent191 (5 August 2009)

If you got GPT on your Commsec watchlist, your watchlist will stop working.  Go into edit and remove GPT and it will work again.


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## tj001 (5 August 2009)

Here is a possible explanation of the volumes give by Bus Day

As part of last week’s decision to exit the ailing business, GPT issued an ‘‘in-specie dividend’’ to an unlisted company.

But some trust deeds restrict ownership of unlisted units. So to escape any breaches, investors who sold yesterday will buy back the same number of GPT units, at the same price, when they go ex-distribution next month.

That idea did not thrill some investors, but analysts have said the issuing of the in-specie dividend will eliminate the risk of the joint venture having to be consolidated back onto GPT’s balance sheet.

GPT has 9.2 billion units on issue, which means that despite the high volume changing hands yesterday, there was not believed to be any takeover activity from Stockland. GPT closed 0.5c higher at 52c.


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## Looingforvalue (5 August 2009)

Most of that volume is stock the big institutions eg superfunds etc "sold" to the brokers cum entitlement to the B&B JV that will be repurchased by the same instos after today when GPT goes ex that entitlement.

The reason this is done is that those "selling" instos cannot hold unlisted stock, which is what the shares in the B&B JV are.

You will see in the detailed trades today, lots of crossings in the hundreds of millions. I saw lines of 316m.

Small instos that can't hold unlisted stock simply sold their holdings, hoping to buy back after today.

If you are a believer, the stock is cheap. NTA post writedown and transfer of B&B JV is about 71-75 cps. 

There will be a strategic briefing by the company tomorrow.

REITS are on the comeback. In the US, Simon Property Group is looking interesting on the chart. Also, comments by the company in its results last night suggest they think the market there is close to a bottom.

I think if we are in a bull market, the REITS will be the next sector to attract investment dollars. There will be lots of M&A activity in this space once there's confidence the bottom in the property cycle has been reached.


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## Prem (20 August 2009)

I have recieved some information from gpt 

regarding a specie dividend of bgp holding:
the gpt groups interest in the european component 
of the babcock and brown joint venture 

can any one shed some light on this ?


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## Julia (5 October 2009)

I've just been flicking through some of the property stocks, and notice GPT's SP has been doing quite well.

I see a dividend of 17.5% is being quoted.  That sounds unrealistically high.
Does anyone know any background on this Group, esp with regard the dividend?


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## StevenSchiffer (9 November 2009)

*VALUE	         Company	All Ords	Sector	*
P/E ratio	10.46	13.94	8.77	
P/B ratio	0.45	1.59	0.58	
P/E Growth ratio	10.00	1.88	10.00


Hi everyone. Thinking about buying GPT stock. I'm a N00B so I was wondering what do you think? Price to bookvalue looks promising and the Price to earnings implies confidence in the company..right?

Thanks for your help!


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## drsmith (9 November 2009)

Julia said:


> I see a dividend of 17.5% is being quoted.



That might be historical and include dividends pre-capital raisings which were much higher than the latest two quarterly distributions.

Annualised the latest quarterly distribution equates to a yield of 6.7% based on a share price of $0.60.


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## nulla nulla (17 December 2009)

GPT unloaded GPT - Halverson for 2 Euros. The share price dropped to $0.545 then rebounded to $0.595 befor settling back to $0.57. 

GPT then announced it had sold of the Resort section of assets (not including Ularu Resort, yet) and is well on it's way to achieving a trimmed back Australian version. 

You would suspect these developments would make GPT more attractive to a potential take over by SGP? At yesterdays close of $0.565 it represents a significant discount to the NTA of $0.71.


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## nulla nulla (19 December 2009)

GPT announced that it would reduce the number of share on issue by consolidating them to one for every five held. The price rose from a low of $0.56 to $0.595 (last trade before the 4:00pm auction) but closed after the auction on $0.58. The MACD graph looks interesting. 


https://www.aussiestockforums.com/forums/attachment.php?attachmentid=34992&stc=1&d=1261175787


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## Bryan Carlin (19 December 2009)

Theo ended up in a wheel chair. But that is not to say he could not gain speed and momentum. The 'buy and 'hold' arrangement, at the moment, is for those with their hands on their heart. I call the curent market the 'sex market' because it goes down faster than it goes up.


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## nulla nulla (19 December 2009)

Bryan Carlin said:


> Theo ended up in a wheel chair. But that is not to say he could not gain speed and momentum. The 'buy and 'hold' arrangement, at the moment, is for those with their hands on their heart. I call the curent market the 'sex market' because it goes down faster than it goes up.




Perhaps you are forgetting the viagra stimulus of the compulsory 9% superanuation contribution. This has the effect of underpinning the xao and providing a concistant source of funds for the superannuation funds to play their buying and selling games.


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## AngusSmart (6 March 2010)

Bump on this stock  anyone doing anything with it lately?

they seem to be on a bit of a turnaround. yet still burning money perhaps?


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## nulla nulla (6 March 2010)

GPT has tracked sideways since mid December2009. It appears to find support in the $0.545 - $0.56 area but its' high have been reducing (recent highs $0.63, $0.62, $0.61). 
It has unloaded most of it's non core assets and is focusing on Australia (I believe it still has US assets and the Hotel/Resort at Ularu). 
The Dividend has been cut to a lower proportion of income after costs and represents a poorer yield than previous years. It is still trading at a significant discount to NTA when compared with the likes of CPA, CFX and SGP. SGP continues to maintain a strong presence on the share register of gpt. 
It could be worth accumulating a parcel on the lows, even as a spec for any takeover/merger actvities that may emerge as the economy recovers.
I personally feel it needs to break through $0.60 and hold otherwise I would wait for a retrace to $0.58 before getting some more.


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## buysellmestuffed (7 March 2010)

I would buy at 56.5c-57c  and sell at 59-60c , your buy in price with this stock has to be correct to make money , one good thing is that it trades high volumes , so it's not hard to sell .Its just hard to buy at the right price .

I would not be a long term holder of this stock , but day trading is profitable at the correct price .


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## nulla nulla (11 March 2010)

Well it tapped $0.60 then fell back appearing to find some support at $0.575. If it holds this support level it could breakout above the upper level of the downward trend pattern. If it doesn't hold at $0.575 it appears the next support level is $0.545. Volumes are still good but the discount to net tangible assets is now increasing.


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## nulla nulla (21 March 2010)

The last three days trading saw a spike in volumes with turnover lifting above 60 million shares turn over per day (104 million on Thursday). 
$0.575 became a resistance point and $0.56 a support point with only a brief dip to $0.555. The longer term indicators show a falling trend line with the share price gradualy reducing to the support level of $0.545.
This represents an increasing discount to the net tangible asset (nta) backing per share. Surprisingly gmg (which has a history of trading in close proximity to the gpt value) is trading in the area of $0.60 - $0.62. 
The reletive strength chart is starting to move in the right direction, but it is still hard to see the share price getting above the upper (downward) trend line, which is now down arround the $0.59 level. 
Do the increasing volumes suggest it may be building for a breakout?


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## nulla nulla (27 March 2010)

The Exponential moving average continues to fall while the relative strength index has started to climb out of the oversold territory. The volumes are increasing in this support price range but how do you decide that this represents someone (buyers) accumulating as against someone else (sellers) unloading.  
The discount to NTA is increasing and the dividend/yield as a percentage of the share price is improving for anyone entering at this level with a view to a hold. At $0.56 the minimum annual div outlined in the Annual Report represents a return of 5.36%.
Will they get cheaper next week? I hope not after Wednesday. I picked them for the stock tipping competiton for April.


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## Prem (12 May 2010)

Hey guys 

My portfolio shows that my holdings in GPT is trading at 0 $ 

does anyone know whats going on 

have I lost all my money ?


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## nulla nulla (12 May 2010)

comsec advised it would take 24 hours for the change to take effect in the portfolio holding statement.


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## Prem (12 May 2010)

nulla nulla said:


> comsec advised it would take 24 hours for the change to take effect in the portfolio holding statement.




Sorry about my ignorance but 

What change :S 

ohh wait is it an error with etrade/commsec ?

Thanks in advance,
Prem


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## qldfrog (12 May 2010)

got same scare but no need to panic: GPT consolidating 1 for 5 end of the month; curently trading till this is fone as GPTDA
take your number of shares, divide by 5, and you have your equivalent GPTDA last trade today:$2.8


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## kimta (12 May 2010)

here is the news from Sydney Morning Herald
Recovering property trust GPT Group has gained the backing of investors for a plan to roll every five units in it into one. The resolution passed at the AGMon 10 May 2010 means the price per share will rise above the critical $A1 levelthat applies to many large institutions' stock buying criteria. Thedividend will also rise five-fold to $A0.15. On the day the shares closed $A0.15higher at $A0.55


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## elaine329 (13 May 2010)

So... does that mean if i have 100 shares now will become only 20?
Sorry I am kind of confused by all these news


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## Julia (13 May 2010)

elaine329 said:


> So... does that mean if i have 100 shares now will become only 20?
> Sorry I am kind of confused by all these news




Yes.  It won't make any difference to you in reality as the stock price will similarly change, and one share will be worth 5 times what your previous one share was worth.


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## nulla nulla (14 May 2010)

The closing price of $2.81 (is the equivalent of 5 X $0.562) which more dramatically shows the discount to net tangible assets of $3.45 (5 X $0.69).


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## nulla nulla (14 May 2010)

For what it is worth, the ASX printout shows that 48% of turnover on 13 May 2010 were short trades. Buggers have to buy back at some stage.


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## buysellmestuffed (15 May 2010)

I used to like trading this stock when it was cents , you new its chart levels and it traded consistently .


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## rtjoa (21 May 2010)

Sorry guys, I'm completely clueless about things happening in GPT. Can anyone shed some light briefly on why do they need to convert 5 stock into 1 ???

I'm a holder, but yes I'm a total noob and just hold them on the advise of my uncle. However, he is overseas at the moment, so I guess I'm hoping you guys could shed some light here. I've tried to search for any announcement on why this was happening, but no luck.

Thanks a lot guys !


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## drsmith (21 May 2010)

rtjoa said:


> Sorry guys, I'm completely clueless about things happening in GPT. Can anyone shed some light briefly on why do they need to convert 5 stock into 1 ???



GPT had to raise capital at very cheap unit prices to repair its balance sheet (pay off debt) after some very poor investments choices pre GFC.  It was one of many property groups in this situation. The conversion restores a blue chip look of respectability to the unit price and helps to erase the memory of a very dark chapter in its long history.

The conversion in itself does not change the value of your holding.


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## rtjoa (22 May 2010)

drsmith said:


> GPT had to raise capital at very cheap unit prices to repair its balance sheet (pay off debt) after some very poor investments choices pre GFC.  It was one of many property groups in this situation. The conversion restores a blue chip look of respectability to the unit price and helps to erase the memory of a very dark chapter in its long history.
> 
> The conversion in itself does not change the value of your holding.




:thankyou: drsmith ! This certainly clears my fear. I thought something really bad happened but the fact that I couldn't find any bad news about them is what really baffled me. All is good now !


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## speedbiker (8 August 2010)

So what will happen to the dividend they use to pay ? Will it be multiplied by 5 ? Lets say before they make 5to1 they use to pay a share 0.0056 according to 2009 !! Are they going to maintain that ?


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## So_Cynical (8 August 2010)

speedbiker said:


> So what will happen to the dividend they use to pay ? Will it be multiplied by 5 ? Lets say before they make 5to1 they use to pay a share 0.0056 according to 2009 !! Are they going to maintain that ?




All things being equal the dividend will be multiplied by 5.., ALZ recently did a 1 for 5 consolidation and the dividend went from 2c to 10c (last to next) but half on corresponding half the divi went from 3c to 10c


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## nulla nulla (22 October 2010)

Here I was thinking the surge through $2.95 signalled a breakout and the price would climb to $3.00+ when the wheels fell off and the price dropped back to $2.88 before closing today at $2.90. Not good particulary as yesterday they announced a div of $0.041cps. 

It goes exdiv on Tuesday, does this meean we can expect the price to drop to $2.86. Stay tuned, same time, same bat station, same bat channel.


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## nulla nulla (30 October 2010)

Yes, gpt went exdiv and the price dropped from $2.92 to $2.87, then stockland group decided they could make better use of the funds tied up in gpt and sold 238 million shares to the insto's at $2.75 ea. 
The price promptly dropped as the insto's started taking their profits on the difference between the $2.75 purchase price and market price. Closed on $2.79 after tapping $2.77. 
I wouldn't be surprised to see the price drop to $2.75 and even lower as the insto's unload with an average sale price above $2.75. GPT could be worth picking up arround the present levels for a longer term hold. Certainly a big discount to net tangible asset value.


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## nulla nulla (11 December 2010)

GPT touched $2.73 then found a line of support at $2.75. Every time it looked like getting ahead as it clawed its' way up to $2.80 - $2.85 it was pushed down, probably the institutions that bought from SGP at $2.75 and retail traders that bought on market at the support levels, taking their profits.
Over the last three days gpt has banged on a quick $0.11 jumping from $2.77 to $2.88.

The RSI chart suggests the share price is moving into "overbought" levels as it gaps up from the moving average price. Bear in mind though that with the volume of shares released into the market by the SGP sale (insto's taking their profits) the moving average share price dropped fairly quickly.

The MACD chart shows the share price finaly gapping above the Converging and Diverging averages. The multiple moving average chart suggests the price may be turning back upwards. 

It would not surprise me to see the share move gradualy back up from here to the $3.00 level and higher (which was the $0.60 mark before consolidation). However there are two factors that could see the price linger at these levels and take longer to recover towards parity with Net Tangible Asset value and they are:

1. There are still plenty of shares sold by SGP at $2.75 to insto's that could be pushed back into the market at a moments notice as they elect to take profits; and
2. SGP is no longer lurking in the wings for a potential take-over of gpt, which may have been helping to keep the gpt share price bouyant.

As always do your own research.


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## nulla nulla (17 December 2010)

GPT finished the week on $2.91 after jumping to $2.95 the previous day. Hopefully the insto's unloading the shares bought from SGP have thinned out and GPT can continue to recover to $3.03 and higher.


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## nulla nulla (27 December 2010)

$2.95 appears to be a resistance level, but I liked the quick recovery from the drop back to $2.91. Hopefully $2.95 will be a break through point then become a support level. Hard to get a feel for what it might do in the next week or two on low volumes of turnover.


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## nulla nulla (2 January 2011)

The share price is still headbutting the resistance level of $2.94 - $2.95 but held up well in the buy/sell action of Thursday Friday which saw a few other REIT's being sold down in the closing stages of 2010. 
If anything the chart suggest (to me) that gpt is ready to break out upwards. Roll on 2011.


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## nulla nulla (12 January 2011)

Talk about unpredictable. Once again gpt managed to break the wrong way, dropping down to what appears to be a support level of $2.88. Interestingly, yesterday it opened at $2.91, dropped to $2.88, rallied up to $2.96 then fell in the clossing stages back to $2.90.
There could still be insto's locking in profits from their take up of the SGP parcel unloaded at $2.75 holding the price movement back. gpt also got a mention in business as a potentail takeover in 2011.


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## nulla nulla (15 January 2011)

gpt continuest to show volitility this week. On Thursday the price jumped from $2.93 to $2.99 interday before closing on $2.96. After opening at $2.96 on Friday, the price dropped to $2.90 then fluctuated between $2.92 - $2.93 before falling back to $2.91 in the closing auction. 
gpt seems to be in a tug of war between the bears and the bulls at the moment. It will likely announce a dividend in February which could see the price sneak up as the announcement date nears.


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## nulla nulla (23 January 2011)

On Monday the price dropped to $2.89 and I picked up a small parcel at $2.90 on the way down, which I immediately put in the sell queue at $2.96. On Wednesday I sold at $2.96. 
On Thursday I re-entered at  $2.90 and on Friday the price fell to $2.84 before closing on $2.85. I had another buy in the auction at $2.84 but missed out. 
If it is still down on Mondays open I will look at another parcel at $2.84. Mind you if the overhang from the sale of the sgp parcel is being reduced, a lower entry price may be in order. The next support level appears to be arround $2.82 and after that arround $2.77. As always DYOR.


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## nulla nulla (28 January 2011)

Nice bounce on Tuesday followed by a jump to tickle $2.99 on Thursday morning, then a fade back to close at $2.94. Dropped to $2.92 on open today but surged in the close to hold $2.96. 
The market doesn't appear to know what it wants to do with this one. The swings provide opportunities for the quick and confident. 
The Annual report is due on 21/02/11. There haven't been any negative updates, so I expect them to meet or exceed their targets. Don't be surprised to see an improvement in the share price in the run up to the report. Then again don't be surprised to see the price pushed down because the analyst expectations were higher and were'nt met. As always D.Y.O.R.


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## nulla nulla (5 February 2011)

It still came as a surprise. Spiked up to $3.09 on Thursday. I managed to close out one trade at $3.08 and will re-enter if it dips below $3.03. 
The Annual report is due on 21/02/11. There still haven't been any negative updates, so I expect them to meet or exceed their targets. And I continue to expect to see an improvement in the share price in the run up to the report.
It would be good if it could test the $3.15+ level although this would still leave a discount to nta.


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## nulla nulla (11 February 2011)

Tapped $3.12 twice this week then collapsed to close on $3.03 in the closing auction. Almost broke through to $3.02. 
A bit surprising to me after they came out with the announcement of the change to the constitution setting up the ability to buy back shares. Seems to me they are forewarning of their intention to buy back shares at market (probably a good thing considering the discount to nta). 
The report is due 21/02/11. Still a week monday to go. There have been no profit downgrades, I wonder if they will beat analyst expectations and announce a profit upgrade? 
I've thrown in the MACD chart for the last three months. Only because it is hard to guage the daily volumes due to the sell off by SGP 4 months ago. Hard to work out if the share is overcoming the overhang of insto's selling off their take up at $2.75 or just enjoying a small run up before the report on 21/02/11. As always DYOR, all care and no responsibilty.


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## nulla nulla (19 February 2011)

Tapped $3.19 on Friday before settling back to close on $3.16. This is still trading below nta and has scope for improvment against earlier highs (since the global financial crisis).

I can't help wonder if there is an element of "buy on rumour" pushing the price up in the runup to the report due on Monday. If "fact" doesn't meet expectation the price will most likely beat a fast retreat. 

From the recent releases I am expecting a good report: Improved result, improved nta from recent sales; possibly a small increase in earnings forecast for next year; small increase in proposed div for next year; and the announcement of a sharebuy back. Sounds like an early xmas wish list


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## nulla nulla (21 February 2011)

Seems the report isn't due until 25/02/11. Ooops....my bad. D.Y.O.R


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## nulla nulla (26 February 2011)

The report came out yesterday. The price dipped to $3.03 then moved up to peak at $3.13 before closing on $3.10. 

Sometimes you wonder if those "in the know" use their market clout to short the price down before the announcement, so they can accumulate and benefit when the report comes out and the price rebounds. Nah... it couldn't happen.


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## nulla nulla (13 March 2011)

Finding support at the $3.03 level but struggling to hold any gains. In danger of dropping below the $3.00 level. Next level of support appears to be arround the $2.90 level. I would be surprised to see it dip below $2.87. DYOR


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## nulla nulla (19 March 2011)

REIT shares took a hit accross the sector and GPT was no exception. The Nuclear crisis in Japan meant that a lot of investors were spooked into selling out and seeking safety in cash or bonds. GPT was slapped down to the low $2.90's but showed resiliance to recover to close at $2.97 (after tapping $2.99 before the close of normal trading). 

It would be too bold a call for me to suggest where the share price may go next week. The Japanese nuclear reactor crisis has further to run and there may be more offshore investors pulling their money out of Australian REIT's next week. Then again for every seller there has been a buyer and local investors may be stepping in to buy up a share that is trading at significant discount to NTA.


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## nulla nulla (26 March 2011)

It would appear that the market sees gpt as a worthwhile investment this week and has jumped in to buy up the bargain prices on offer, pushing the price up above the exdiv price.


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## nulla nulla (8 May 2011)

Once again GPT dropped after going exdiv. Recent support suggests it should not take long to recover above $3.10. Lates announcements have also been positive as gpt moves closer to consolidating its core quality assets and unloads non core assets at improved market prices. 

Tight spread pattern for any swing traders looking to trade. DYOR.


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## nulla nulla (14 May 2011)

A rapid rebound after going exdiv. The news releases are all gung ho with: the shedding of non core assets; talks in progress to unload the Newcastle liability; and a share buyback.

The closing price of $3.12 is still well below the NTA and equates to $0.62 per share prior to the 1 for 5 amalgamation. Gotta be a bargain for the long termers etc etc but with the market being driven by sentiment FA & TA are really irrelevent atm. 
As always dyor, comments made are an observation only and not a recommendation.


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## nulla nulla (23 June 2011)

Not a lot has changed in the share price since mid may. $3.19 appears to be a resistance line from which gpt has dipped away from in the after-math of the Newcastle sale falling through. The lows seem to be getting higher. Maybe it is building for a break out ????  DYOR


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## nulla nulla (2 July 2011)

Sideways this last week between $3.13 and $3.19. Not enough support to push through the ressistance level of $3.19 but enough interest to bounce off $3.13. Still a good discount to NTA and still a reasonable yield rate for the FA & TA investors. Could do with some more spread for short term swing traders.


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## nulla nulla (22 July 2011)

Retail negativity weighed heavily this week on the reits with retail exposure like gpt, sgp and wdc/wrt. Fortunately retail is only one component of gpt's make up.

The share price dropped toward the end of the week touching $2.99 interday (which is lower than the $0.60c value prior to the 1 for 5 consolidation). At $3.02 and $3.01 I considered the risk low enough to warrant an entry. My perspective is that gpt is only dispersing a proportion of income by way of dividends and is now working at increasing share holder value by way of share buy back (maximum 5%). Yield is solid and the price earnings ratio is low. 




As always dyor and good luck. In my opinion, unless we shrug off the retail gloom and doom and money starts moving arround we are going to see a lot more sideways and downwards movement for some time to come.


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## nulla nulla (29 July 2011)

gpt tracked side ways this week. Unable to break out upwards but finding good support arround the $3.00 area. 




At least it didn't get dragged down by the retail exposure like Westfields and Stocklands did.


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## nulla nulla (7 August 2011)

Lots of negative retail news and the influence of the sovereign debt issues now impacting on the REIT sector and gpt getting pushed down in the general fallout.

Better fundamentals this time arround and lower debt ratios with no major financing falling due, should mean that the share price will not get savaged as badly as it was in GFC mkI. No doubt some of the overseas investors will pull their money out and this will likely push the share price dow. However I would be surprised if local superannuant companies don't buy in on the opportunity for cheaper entry prices.

[Hey Joe, I can't load my charts??  Has something changed?]


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## nulla nulla (7 August 2011)

Here is the missing chart. 





Thanks Joe for the quick fix.


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## nulla nulla (20 August 2011)

From a low of $2.58 to a high of $3.15 after an earnings upgrade, the trade opportunities were too good to pass up. The share price drifted back down with the herd on thursday and friday but found significant support in the $2.94 - $2.95 range.




No doubt the ongoing share buy back helps. While it could drift lower in the near future it has two (2) dividends comming up before the end of the year that would have been arround $0.045 each before the earnings upgrade. This may also help support the share price in this turbulant period. As always dyor


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## nulla nulla (2 September 2011)

Languished last week then ran up to $3.14. Went ex-div at $3.13 then hardly budged, tapped $3.08 then recovered, managing to continue trading in the $3.11 - $3.14 range. 




Today someone wanted to unload a large parcel (priced at $2.85) in the open and for a little while the share price looked like opening at $2.90. 

Seems a few other traders saw the gap down and set higher bids lifting the opening price to $3.05, however my bid at $3.04 was quickly filled and I immediately threw it back in for a sell at $3.08.   Some days it is like taking candy from a baby.


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## nulla nulla (30 November 2011)

The lows have been getting lower and the highs lower also. However gpt continues to track mostly sideways and provide interday opportunities on tight spreads on a regular basis.  




Jack be nimble, Jack be quick. Sometimes it is like catching fish. You might not get the all the big ones but if you catch enough small ones you still get a decent feed.


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## nulla nulla (21 January 2012)

For the last 12 Months, gpt has pretty much traded in a range from $3.00 to $3.20.




Over the last few weeks gpt looked like it was consolidating for a break out above $3.20, however on thursday gpt dropped to $3.08 closing on the days low (after opening at $3.15) and friday gpt opened at $3.12 then dropped interday to $3.06 before rallying to close on $3.10. Hopefully gpt will find support at this level and rebound to test the upper long term channel level of $3.20.




Otherwise the channel bottom of $3.00 beckons.


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## nulla nulla (26 February 2012)

GPT went exdiv last week at $3.12 (after testing $3.16 earlier in the week). The div is $0.049cpu so naturaly the share price dropped by more than the div tapping $3.04 before rallying on Friday to hold $3.11 in the close.




It will be interesting to see whether or not gpt can hold this level and/or climb to the upper channel levels of $3.20 in the next week or so. A few REIT's took a hit this week after the annual reports were released but GPT's report was fairly positive going forward. Personaly, I'm looking for a rally to consolidate the div plus a capital gain as gpt continues to trade at a discount to nta and has one of the lowest debt gearing ratio's of all the REIT's.


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## nulla nulla (5 March 2012)

$3.16 appears to have turned into a level of resistance. While gpt bounced back nicely after going exdiv (after testing some exagerated lows), it seems to be struggling to get through $3.16. 

Opened today at $3.15, tested $3.16 for a short while then the sellers built up and pushed it steadily down to $3.12. At one point, in the closing auction, it looked like closing on $3.11 however buyers jumped in with seconds to spare and pushed the closing price back to $3.13.





Can't see why gpt is under such a strangle hold when the likes of Dexus, CPA and IOF are trading in the higher ranges of their price channels. IMO, if it drops back much further it will present further trade oportunities. As always DYOR.


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## nulla nulla (17 March 2012)

On recent figures GPT seems to be developing a resistance point at $3.16 while garnering a lot of support in the $3.07 - $3.10 level. 




With very low debt levels compared to some of the other REIT's, gpt seems to be underpriced in the market. Imo it is hardly surprising to see the share price spike up to $3.20 from time to time. Just wish I could pick when it was going to happen


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## nulla nulla (5 May 2012)

In late April the Australian REIT suddenly became attractive to investors and shares across the sector lifted by 3-5%. GPT was no exception breaking through the recent resistance level of $3.16 and the longer term resistance level of $3.27 (from 6/12/2011).
Tapping $3.31 early this week, gpt fell back through the week but found support at $3.22 (which was previously a resistance level) and closed on Friday at $3.26. Can it go higher from here? The trend from early February is definitely upward but has it got the substance to justify going higher?




With the share price at $3.26 gpt has reduced the discount to NTA, has reduced the yield for potential investors and is trading at a fairly high price/earnings ratio. You would think long term investors would be guided by yield (which is now fairly low in comparison to most of the other reits) and price/earnings ratio (which is high in comparison with other reits). Admittedly gpt has one of the lowest borrowing levels of the reits but is this enough to encourage the long term investors or is there another factor in play that we small investors are unaware of? I dunno. 

I'll wait for more information or a better entry price before putting my hard earned in for now. As always do your own research and good luck.


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## nulla nulla (18 May 2012)

$3.19 on Tuesday looked like a good entry but I missed the same day exit at $3.24 (too far back in the queue and moving it down would have lowered the closing price). Entries on Wednesday at $3.18, $3.17 and $3.15 averaged the combined hold down to $3.1725.  Dropped the lot at $3.20 a couple of hours after open on Thursday when it looked like it was struggling. (Although, naturaly after I sold, the share price worked up to $3.22).




Happy with the exit and protection of capital after the price dipped today to $3.16. Will continue to monitor market sentiment for further entry opportunities. DYOR


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## nulla nulla (16 June 2012)

They reckon a week in politics is a long time and things change quickly but a month in the market is equally unpredictable.

gpt ranged from the low of $3.14 up to $3.33 than back to $3.19. The share buy-back is possibly underwriting the share price to some extent but it is ex-div and trading at a larger multiple of earnings than most other reit's. 




Personally I think they need to work on increasing their earnings and subsequent dividends to warrant the current share price levels. Notwithstanding gpt continues to provide trade opportunities through the share price volatility for the quick. d.y.o.r & good luck.


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## nulla nulla (30 June 2012)

Interesting two weeks since the last post. Opened at $3.16 on Friday 22/6/12 (below recent support at $3.19)and recovered through the day to close on $3.21. $3.22 seemed to be a resistance level that continued into this week then without any anouncements gpt surged on Wednesday and held up to close out the week at $3.29.




$3.19 appears to be developing as a support level with exit oportunities at $3.26+ for the patient. Be careful though, the share buy back will finish eventually and the price may not be so strong afterward without the buyback support. as always d.y.o.r.


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## nulla nulla (7 July 2012)

Someone didn't read the script? While the rest of the reit's did a jig between the ex-div price and the price before they went ex-div, gpt decided to test new highs.




Work that out. Volumes are not all that impressive, the gap between nta and share price is narrowing, the price earnings ratio is out of kilter with the xao let alone the rest of the reit's and the yield is...well it's pathetic. Why is gpt performing so strongly. Are they a take over target?


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## nulla nulla (29 September 2012)

The relentless rise of gpt continued through August culminating in an opening price of $3.66 on 6 September 2012. At this point gpt was trading at a premium to nta and one of the highest price earnings ratio's on the asx. Since then, gpt has steadily declined falling through $3.51, which looked like it might hold as a support level but it didn't.




Closing out the week at $3.40 saw gpt give up the support line for the week of $3.42. If it doesn't rally from here it could easily drop back to the $3.32 lower channel bar. I find it curious that market sentiment has driven gpt to a price level higher than sgp which currently has better yield, a better price earnings ratio and is trading at a bigger discount to nta. As always do your own research and good luck.


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## nulla nulla (19 October 2012)

And away she goes. Obama won the second debate, the RBA dropped the interest rate, the Aud$ fell back against the US$ and the buyers snapped up gpt pushing the price back up to test $3.60 before dropping back to $3.53, then rallying again on the distribution notice to close out the week at $3.56.




gpt goes exdiv early next week, I think it is Tuesday. No doubt it will drop after that, although I supect that the  drop will be brief and GPT will rebound to the low or mid $3.50's. As always D.Y.O.R and good luck.


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## nulla nulla (24 October 2012)

nulla nulla said:


> And away she goes. Obama won the second debate, the RBA dropped the interest rate, the Aud$ fell back against the US$ and the buyers snapped up gpt pushing the price back up to test $3.60 before dropping back to $3.53, then rallying again on the distribution notice to close out the week at $3.56.
> 
> View attachment 49383
> 
> ...




I picked up a partial fill at $3.53 before gpt went exdiv. It climbed to $3.60 on Monday then dropped to $3.58 before I could close out a trade. I elected to hold for the div. On tuesday while exdiv, gpt rallied to $3.60 and I sold. Nice combo of div and capital gain.

Today gpt dropped to $3.50. Go figure, it should have done this yesterday?


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## nulla nulla (29 October 2012)

Nice announcement today. Looking good going forward. Anyone that picked up last friday in the $3.50 - $3.52 area had the opportunity to unload today at $3.57 (and if you put your sell in early, possibly even $3.58).

The share price dropped suddenly after 3.00pm. Interestingly enough the dow futures were down also. Possibly a re-action to the hurricane? Never mind, the close of  $3.53 was a good re-entry point (in my opinion) so I jumped back in. The update was pretty good in my opinion. I particularly liked the low gearing rate, the low finance costs going forward and the high occupancy rates. Basicaly it looks like the status quo of income per shareholding is fairly secure.

Then again, what would I know. As always do your own research and good luck.


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## nulla nulla (3 November 2012)

GPT took a hit in the sector sell down of some of the Australian reit's into the Friday close, closing the day on an interday low of $3.49. The sell down was some what of a contrast to the upbeat nature of the report released during the week. I suspect it may have been driven by a withdrawal of overseas funds in reaction to the hurricane in the U.S, similar to the pull out of funds from Australia after the Tsunami in Japan.




It will be interesting to see whether the gpt share price rebounds from here or slides to test lower support levels. As always d.y.o.r and good luck.


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## nulla nulla (8 November 2012)

In the aftermath of going ex-div, hurricane sandy and the US Presidential election, I am surprised at how well gpt has held up, on good volumes as well.


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## Out Too Soon (12 December 2012)

The chart is looking positive over the last month. Another thread where you've been talking to yourself Nulla, thought I'd keep you company. :

I currently don't hold but it came up in a scan


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## nulla nulla (12 December 2012)

Out Too Soon said:


> .... Another thread where you've been talking to yourself Nulla...




Yep an excellent audience too. 

I think the number of "views" might reflect that there is a fair interest in gpt. Since the announcement in respect the bid for Australand's assets (excluding residential developement) gpt leapt to $3.70 early in the week but has been drifting down since. The div might hold the share price up a bit in the lead up to 21-12-12 but don't be surprised if it tracks sideways (and down?) if the market really is shifting away from the security of yield shares to more risky resource shares. As always d.y.o.r. and good luck.


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## bailx (14 December 2012)

My guess is that GPT are a little over there head on this one?
I got a good feeling that there bid for ALZ will fall through and they will lose on those grounds. ALZ will continue to prosper.
Might want to place a stop loss? interesting to see how it all turns out?
ALZ +0.06  GPT -55%

http://www.moodys.com/page/viewrese...61822&WT.mc_id=NLTITLE_YYYYMMDD_PR_261822</p>


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## skc (14 December 2012)

nulla nulla said:


> Yep an excellent audience too.
> 
> I think the number of "views" might reflect that there is a fair interest in gpt. Since the announcement in respect the bid for Australand's assets (excluding residential developement) gpt leapt to $3.70 early in the week but has been drifting down since. The div might hold the share price up a bit in the lead up to 21-12-12 but don't be surprised if it tracks sideways (and down?) if the market really is shifting away from the security of yield shares to more risky resource shares. As always d.y.o.r. and good luck.




GPT is on a different dividend cycle so no ex-div for them on 21/12/12.

Would be interesting to see some quants work on REIT's performance leading up to dividend, and whether those on a different cycle (GPT, ABP for example), lags during the period.

Nulla - out of interest do you ever short REITs?


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## nulla nulla (14 December 2012)

No, I never short reit's. Actually I never short anything. Just sell when I think I have made enough or the share price has risen all I can reasonably expect.

You are correct. GPT announce on 6 december 2012 that the quarter distribution for period ending 31/12/12 would not be announced until 2 January 2013 with the payment date to be approximately mid march.


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## bailx (16 December 2012)

View attachment 49982
View attachment 49983


nulla nulla said:


> No, I never short reit's. Actually I never short anything. Just sell when I think I have made enough or the share price has risen all I can reasonably expect.
> 
> You are correct. GPT announce on 6 december 2012 that the quarter distribution for period ending 31/12/12 would not be announced until 2 January 2013 with the payment date to be approximately mid march.




That's quite or Reit? Personally this ones into losing money. you can wait for ya payouts in a few month's but i believe with little affect. GPT needs to Swing back and re think its Financial Structure. With all respect!  Supply & Demand. Buyers are Selling....

ACCUMULATION DISTRIBUTION.......Can be a good signal for a change in trend, when it go's the other way?


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## nulla nulla (16 December 2012)

Interesting article in the Sydney Morning Herald Business section by Carolyn Cummins:

http://www.smh.com.au/business/gpt-presses-on-despite-rebuff-from-australand-20121214-2bf4j.html

Brokers suggest GPT needs to win over CapitaLand (Australands major shareholder) but it will need GPT to offer a premium to NTA. The indicative price is undisclosed at this stage (and I can't work out the value of the residential component of ALZ to back it out of the NTA then add back the premium of $0.243c per share the bid offers to work out the bid).

Analysts at CBA appear to think CapitaLand will accept the offer. They also suggest the acquisition will add a further 8.2% to GPT's 2013 earnings.

It is worth noting that GPT reported on 13 August 2012, in their interim results for 31 June 2012 that they have Assets of 9 Billion and debt of only 1.8 Billion giving a gearing rate of 20.2% (one of the lowest of all the A-REIT's). 

GPT is reported to be considering a capital rasing at $3.40 per share but I haven't seen any indication of whether this is true or whether it would be to existing shareholders, fundmanagers & sophisticated investors or a combo of both. Also I haven't seen any indication of how much they need/intend to raise. If you peruse the comparative table below of ALZ and GPT you would note that GPT is three (3) times the size of ALZ and could probably easily raise the necessary funds to acquire ALZ without adversly lifting their Asset/Borrowing gearing rate.


*Date:*  *Closing 14-12-12*      *Share:	* *ALZ*  *GPT*     *Closing Price* 	3.31		3.56	 *Issued Shares* 	576,846,597		1,766,785,075	 *Capital	*	1,909,362,236		6,289,754,867	 *Earnings $* 	0.2520		0.1789	 *ROE* 	7.61%		5.03%	 *Dist $* 	0.2150		0.191	 *Yield %	*	6.50%		5.37%	 *P/E* 	13.13		19.90	 *NTA $	*	3.46		3.65	 *Discount to NTA* 	4.34%		2.47%	


I suspect from the market reaction to GPT's announcement that it intended to proceed, that the market already considers it a done deal. ALZ jumped again on Friday and GPT dropped, probably commencing the slide down to the prospective capital raising price of $3.40.  I suspect the rejection of the offer by the ALZ board is more to remove the conditions and break fee in the offer and make GPY go unconditional. 

Disclaimer: The figures used in the table may contain errors and should not be relied upon to make investment decisions. As always do your own research and good luck.


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## nulla nulla (14 February 2013)

The Annual report released today for Year Ending 31 December 2012 is worth a read. The Key points are listed below. They seem fairly confident going ahead, forecasting 2013 EPS growth of at least 5%.


*KEY HIGHLIGHTS*
*FINANCIAL:*
Net profit after tax of $594.5 million for the year ended 31 December 2012, up 141.5 per cent on 31
December 2011. The result reflects strong operational performance and an uplift in underlying
property values.
Realised operating income (ROI) *1* of $456.4 million *2*, up 4.0 per cent on 31 December 2011 *3*.
ROI per ordinary security of 24.2 cents, up 8.0 per cent on 31 December 2011.
Cash distribution of 19.3 cents per ordinary security up 8.4 per cent on 31 December 2011.
Total Return of 9.5 per cent and Total Securityholder Return (TSR) of 26.9 per cent *4*.
Net tangible assets (NTA) per security increased by 3.9 per cent to $3.73.
Continued active capital management, including:
- Diversification of debt sources with $430 million in bond issues over the past year;
- Reduction in average cost of debt by 100 basis points on the previous year; and
- Low gearing of 21.7 per cent.

*OPERATIONAL:*
Total return for the investment assets of 9.3 per cent with comparable income growth of 3.2 per cent.
Continued focus on operational efficiency with expenses declining 6.8 per cent.
High occupancy and long lease expiry profile maintained.
Completed development of 111 Eagle Street, Brisbane, and 5 Murray Rose Avenue, Sydney Olympic
Park.

*STRATEGIC:*
Actively managing the portfolio, with progress made on moving to a more balanced sector weighting.
Significant review of cost base and structure completed, which will deliver a recurring $10 million after
tax earnings benefit in 2013.
Progress made on all four growth platforms to further accelerate performance: funds management,
development, new profit sources and asset acquisitions.
Investing in developing GPT’s strategic direction for the next five years with the goal of being
Australia’s best performing property company.

*GUIDANCE:*
2013 forecast EPS *5* growth of at least 5 per cent.
Payout ratio of 80 per cent of ROI.

Notes to the above:
*1* Before payment of distribution on exchangeable securities.
*2* Statutory profit adjusted for changes in fair value of assets of $221.3m, loss on disposals of ($3.1m), financial instruments marked to market value movements and net foreign exchange losses of ($40.4m), and other items of ($39.7m).
*3* ROI growth was lower than growth in ROI per security because of the impact of the Group’s security buy back.
*4* Total return is defined as DPS plus change in NTA. TSR is defined as distributions paid plus change in security price.
*5* EPS defined as Realised Operating Income per ordinary security. 

Has ther been any further updates on the proposed takeover of ALZ?


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## nulla nulla (14 February 2013)

It would seem GPT is still keen to proceed with the ALZ acquisition but it is not essential to the growth expectations for 2013.

The Bull: http://www.thebull.com.au/articles/a/35457-gpt-committed-to-pursuing-australand-deal.html

Worth a read.


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## nulla nulla (18 March 2013)

Here we were sitting in our rocket ship to the moon and suddenly we weren't going there any more. Seems some-one forgot to pay the fuel bill and the tank was only half full. Made for a good lift off but not enough fuel in the tank to go the full distance. Can't blame this one on the Cypriots as it was on the way down last week.





Question is, whether the share can rally off the support level of $3.72 or are we going to break through and test lower levels. No news recently about the ALZ take-over offer? Anyone heard anything? 

Yeah we bought in at $3.79 for a small trade that is now in the red. As always, do your own research and good luck.


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## skc (26 March 2013)

nulla nulla said:


> Question is, whether the share can rally off the support level of $3.72 or are we going to break through and test lower levels. No news recently about the ALZ take-over offer? Anyone heard anything?
> 
> Yeah we bought in at $3.79 for a small trade that is now in the red. As always, do your own research and good luck.




Still plenty of sellers on GPT and it's been the worst performing REIT in the last two weeks amongst those I monitor. Here's a possible explanation.



> Recent block trades have focused attention on where the next moves will come from and on Monday afternoon the spotlight shone on GPT Group as one potential source.
> 
> Government of Singapore Investment Corporation owns 13 per cent of GPT Group, after bailing the property giant out during the global financial crisis. GIC bought most of its stake at a hefty discount to Monday’s trading price of $3.69.
> 
> ...




From AFR Street Talk http://www.afr.com/p/opinion/gpt_in_limelight_as_block_trades_AaQx3uamHcPMKluBIVqKAK

Probably just some reporter making up news but if the Singaporians do decide to sell I would probably buy a parcel as a longer term hold. Nothing like mindless portfilio moves to create great entry opportunities...


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## nulla nulla (26 March 2013)

GPT has been sliding now for a few weeks. I thought it may have something to do with the proposed acquisition of Australand assets but the share price actualy ran up after the acquisition proposal was announced. Also in this time GPT has raised a substantial amount of funds in the U.S that was raised on the basis of the Aud$ as the relevent currency, so GPT will not have exposure to any drop off of the Aud$ against the U.S$.

On Monday several A-REIT's dropped in a flurry of selling in the half hour leading up to the close and even further in the auction. As you point out it had the appearance of fund managers reweighting their portfolios', exiting the likes of CFX, CPA, DXS, IOF, GPT and SGP (and others) however there was a good take up of WDC and I suspect the $ and volumes of the sales would closely match the take up buys of SCP, WDC and WRT (but not completely as I also expect some of the sales were profit taking).

A large foreign investor winding down their positions at the current AUD$ level would also make sense. If GPT is going to be sold off as a large block, I would expect it to be at a discount to the present levels.  Also, the impact of the sell down on the share price would most likely replicate what took place when SGP sold out of GPT. It may pay to have a bit of cash set aside in case this is what is happening. Apart from the oportunities created on Monday another block sell down of GPT would be worth jumping into (imo). Additionaly they have another div coming up in early May.


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## skc (26 March 2013)

nulla nulla said:


> GPT has been sliding now for a few weeks. I thought it may have something to do with the proposed acquisition of Australand assets but the share price actualy ran up after the acquisition proposal was announced. Also in this time GPT has raised a substantial amount of funds in the U.S that was raised on the basis of the Aud$ as the relevent currency, so GPT will not have exposure to any drop off of the Aud$ against the U.S$.
> 
> On Monday several A-REIT's dropped in a flurry of selling in the half hour leading up to the close and even further in the auction. As you point out it had the appearance of fund managers reweighting their portfolios', exiting the likes of CFX, CPA, DXS, IOF, GPT and SGP (and others) however there was a good take up of WDC and I suspect the $ and volumes of the sales would closely match the take up buys of SCP, WDC and WRT (but not completely as I also expect some of the sales were profit taking).
> 
> A large foreign investor winding down their positions at the current AUD$ level would also make sense. If GPT is going to be sold off as a large block, I would expect it to be at a discount to the present levels.  Also, the impact of the sell down on the share price would most likely replicate what took place when SGP sold out of GPT. It may pay to have a bit of cash set aside in case this is what is happening. Apart from the oportunities created on Monday another block sell down of GPT would be worth jumping into (imo). Additionaly they have another div coming up in early May.




the sell down Monday suited me just fine as i was able to exit a CFX short with good profit, unfortunately I was not able to grab some DXS quick enough which bounced well today. There are also words that the Meriton might be for sale or be absorbed into SGP so managers are making moves on that basis. 

If there's a block trade on GPT I'd expect the price to behave like WRT or GMG after they got sold down. The weakness seems to last around a month or so... WRT hasn't fully recover yet but it's probably the same % off recent high as other REITs anyway.


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## nulla nulla (6 April 2013)

GPT looks like it has been in freefall for several weeks before appearing to find buyers at the support line of $3.72  approximately 2 weeks ago. Bouncing back up to $3.77 GPT then suffered a set back as sellers came out of the woodwork and pushed the share price down to close at $3.65 on Thursday 28-3-13. The indicative opening price for GPT of $3.63 on Tuesday 2-4-13 didn't look good, suggesting that GPT was going to continue the fall. Then right on open the match price jumped back to $3.66 and GPT literaly took off.  The high through the week was $3.89. Unfortunately only a few hundred shares were purchased at this level before the share price faded to finish the week on $3.85. 




There haven't been any announcements regarding acquisitions/mergers (alz), property acquisitions or disposals and/or property revaluations. If anything the sell down has run contrary to most of the other A-REIT's that have tracked sideways and upward during this period. Even more oddly, retail is supposed to be showing signs of recovery along with housing. You would almost expect GPT to be marching onward and upward.  I'm sure it isn't "churning" by the fund managers but I can't think of any rational explanation other than maybe some portfolio reweighting and profit taking? As always do your own research and good luck .


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## nulla nulla (4 May 2013)

The GPT share price increased the rate of acceleration climbing to new 4 year highs, even tapping $4.20 in the last two weeks. The share price drifted down immediately prior to going ex-div ($0.051 per unit) and Mrs nulla jumped in with her smsf to try for a capital gain/div combo trade at $4.09.




It has now dropped to $4.05. It will be interesting to see if it can climb back to the new recent highs in the next few weeks. As always do your own research and good luck.


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## nulla nulla (9 May 2013)

GPT has agreed to settle the class action brought by Slater & Gordon allegedly for $75 million, subject to approval by the courts. It will be interesting to see how much of the pool ends up with the claimants (former shareholders) and how much individual shareholders get per share for those that registered with Slater & Gordon.

GPT indicated in their release that they had/have insurance in place against the claim and the outcome will not impact on their bottom line. The settlement does not construe any admission of liability or wrong doing on the part of GPT or the directors of GPT.


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## rbgmauq (9 May 2013)

GPT is facing the resistance of 4.22. The technical indicator shows a buy with the 4.929 target price in six months.


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## nulla nulla (19 May 2013)

GPT's closing share price of $4.12 for Friday 17 May 2013 does not reflect the amazing swings experienced through the last two weeks. From a close of $4.05 on Friday 03 May 2013, after going ex-div, GPT has recovered quickly to $4.15, fallen back to $4.07,  jumped the next trading day to open at $4.18, dropped like a stone to $4.10, climbed to $4.24 then drifted back to $4.09 before closing out the week at $4.12. 




A bit like a drunk fumbling arround in the dark trying to find the way home. As always do your own research and good luck.


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## nulla nulla (3 June 2013)

rbgmauq said:


> GPT is facing the resistance of 4.22. The technical indicator shows a buy with the 4.929 target price in six months.



I will happily sell you my gpt purchased at $4.10 for $4.90 .
GPT has taken a battering with the pull back of off-shore investor funds compounded by the decision not to proceed with a takeover bid for the Australand assets.




At this point I am looking at taking the loss for the tax offset and sitting out of the market until it settles down into a trade-able pattern again.


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## coolcup (3 June 2013)

nulla nulla said:


> I will happily sell you my gpt purchased at $4.10 for $4.90 .
> GPT has taken a battering with the pull back of off-shore investor funds compounded by the decision not to proceed with a takeover bid for the Australand assets.
> 
> View attachment 52581
> ...




JP Morgan have upgraded GPT to a high conviction buy following the recent price weakness. Not sure that will stop the current slide but may provide some short term support.


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## nulla nulla (4 June 2013)

coolcup said:


> JP Morgan have upgraded GPT to a high conviction buy following the recent price weakness. Not sure that will stop the current slide but may provide some short term support.




The hardest part of trading a share like GPT is working out whether a substantial correction, such as we have seen over the past few weeks, is a golden opportunity to jump in for a good short term profit on a rebound or whether the correction still has further to run. Often after activating a stock loss, the share recovers significantly leaving you out of pocket. Damned if you do and Damned if you don't. 

Can you pass on when JP Morgan upgraded GPT's status? High conviction buy sounds fairly impressive.


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## coolcup (4 June 2013)

nulla nulla said:


> The hardest part of trading a share like GPT is working out whether a substantial correction, such as we have seen over the past few weeks, is a golden opportunity to jump in for a good short term profit on a rebound or whether the correction still has further to run. Often after activating a stock loss, the share recovers significantly leaving you out of pocket. Damned if you do and Damned if you don't.
> 
> Can you pass on when JP Morgan upgraded GPT's status? High conviction buy sounds fairly impressive.




It was just last night that they upgraded.


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## nulla nulla (4 June 2013)

coolcup said:


> It was just last night that they upgraded.




Thanks for that.


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## skc (4 June 2013)

coolcup said:


> It was just last night that they upgraded.




Actually it was 27 May. They did however reiterate the call last night / this morning.


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## coolcup (4 June 2013)

skc said:


> Actually it was 27 May. They did however reiterate the call last night / this morning.




Apologies, I did not see that article. I saw the one last night which must have reaffirmed their call.


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## nulla nulla (16 June 2013)

The good news is GPT has re-activated the share buy back program. Also there was a release to the market that their present debt to asset levels are at a gearing ratio of 18%. Further, the boss considers that GPT has untapped capacity of $2 billion (funds on hand and low cost borrowing capabilities) that would keep the debt/asset gearing ratio under a comfortable 35% enabling them to expand into core assets as and when they become available. 




The share price dipped to $3.68 through the week and while it rebounded it appears to be struggling to find enough support to push back above $3.75. Unlike a lot of other A-REIT's GPT is not due to go ex-div in June. GPT will declare and pay a div in August so there isn't the prospect of a div to prop up the share price this month. 

There is a classic play happening at the moment between the smart money buying shares at great yield and price earnings levels, versus the smart money selling out as the Aud$ falls. It will be interesting to see if there is any significant portfolio reweighting by the large fund managers before the end of June and how this impacts on GPT.


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## nulla nulla (27 July 2013)

For the past six weeks the *GPT* share price has reflected the volitility in the A-REIT sector with the share price ranging between the low $3.70's and the high $3.80's. 




At $3.66 GPT was a screaming buy (the missus screamed at me to buy for her SMSF and I did). Although GPT is my stock pick for July (and it is $0.02 down since the start of the month) I will not pick it for August. GPT is due to go ex-div and pay a div of approximately $0.05 in August. I suspect there will be further gains in the share price before it goes ex-div after which point the share price will likely drop by the amount of the div.


Also it would not  surprise me if GPT took a stake in CPA to thwart any management take-over of CPA by Dexus. It is known that GPT is cashed up, has capacity to borrow more and would probably like to pick up some of CPA's better assets in Sydney & Melbourne. The next few weeks should be interesting.

As always, do your own research and good luck.


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## nulla nulla (4 August 2013)

I must have tempted fate last week. I chose *GPT* in the stock tipping competition and it ended the week testing the support level of $3.59 (interday low of $3.56). Ouch.





*GPT* is due to announce a dividend arround $0.05 in the early part of August, payable late August/early September. The yield is still above 5%, the price earnings is low arround 10:1, the share is trading at a discount to NTA, the debt/borrowings are around 17%, and, from memory, the latest fund raising was repayable in Aud$ so a fall in the Aud$ against the US$ doesn't impact earnings etc. So why the big fall?


*	Share:	*  *	GPT	*    *	Date:	*  *	2-Aug-13	*    *	Closing Price	*  *	3.59	*  *	Issued Shares	*  *	1,742,852,344	*  *	Capital	*  *	6,256,839,915	*  *	Earnings $	*  *	0.3360	*  *	ROE	*  *	9.36%	*  *	Dist $	*  *	0.198	*  *	Yield %	*  *	5.52%	*  *	P/E	*  *	10.68	*  *	NTA $	*  *	3.73	*  *	Discount to NTA	*  *	3.75%	* 

For this post I am using an 18 month weekly chart (as against the usual 6 month daily chart) and an 18 month chart of the Aud$ versus the US$:




Extracting the closing prices at each week end back to a point of parity between the Aud$ and the US$ into an excel spread sheet, I was able to setup the following table showing the GPT share price in Aud$ and converted to US$:


*GPT-US$*       *Share Price*   *Date*  *US$-Aud$*  *Aud$*  *US$*     	15-Jun-12		1.009		3.19		3.22		22-Jun-12		1.006		3.21		3.23		29-Jun-12		1.024		3.29		3.37		6-Jul-12		1.021		3.34		3.41		13-Jul-12		1.023		3.33		3.41		20-Jul-12		1.038		3.40		3.53		27-Jul-12		1.048		3.39		3.55		3-Aug-12		1.047		3.42		3.58		10-Aug-12		1.058		3.38		3.58		17-Aug-12		1.042		3.54		3.69		24-Aug-12		1.040		3.51		3.65		31-Aug-12		1.032		3.51		3.62		7-Sep-12		1.038		3.61		3.75		14-Sep-12		1.057		3.52		3.72		21-Sep-12		1.046		3.42		3.58		28-Sep-12		1.038		3.40		3.53		5-Oct-12		1.018		3.52		3.58		12-Oct-12		1.023		3.55		3.63		19-Oct-12		1.033		3.56		3.68		26-Oct-12		1.037		3.51		3.64		2-Nov-12		1.034		3.49		3.61		9-Nov-12		1.039		3.46		3.59		16-Nov-12		1.034		3.40		3.52		23-Nov-12		1.046		3.48		3.64		30-Nov-12		1.043		3.49		3.64		7-Dec-12		1.048		3.60		3.77		14-Dec-12		1.057		3.56		3.76		21-Dec-12		1.040		3.66		3.81		28-Dec-12		1.037		3.70		3.84		4-Jan-13		1.048		3.67		3.85		11-Jan-13		1.053		3.65		3.84		18-Jan-13		1.050		3.60		3.78		25-Jan-13		1.042		3.69		3.84		1-Feb-13		1.040		3.83		3.98		8-Feb-13		1.031		3.88		4.00		15-Feb-13		1.022		3.78		3.86		22-Feb-13		1.032		3.87		3.99		1-Mar-13		1.020		3.89		3.97		8-Mar-13		1.023		3.94		4.03		15-Mar-13		1.040		3.79		3.94		22-Mar-13		1.044		3.75		3.92		29-Mar-13		1.040		3.71		3.86		5-Apr-13		1.042		3.85		4.01		12-Apr-13		1.050		3.95		4.15		17-Apr-13		1.027		4.09		4.20		26-Apr-13		1.028		4.09	 *4.20* 	3-May-13		1.032		4.05		4.18		10-May-13		1.002		4.14		4.15		17-May-13		0.973		4.12		4.01		24-May-13		0.965		3.90		3.76		31-May-13		0.957		3.89		3.72		7-Jun-13		0.949		3.72		3.53		14-Jun-13		0.957		3.74		3.58		21-Jun-13		0.922		3.71		3.42		28-Jun-13		0.914		3.84		3.51		5-Jul-13		0.907		3.86		3.50		12-Jul-13		0.904		3.83		3.46		19-Jul-13		0.917		3.78		3.47		26-Jul-13		0.926		3.65		3.38		2-Aug-13		0.890	*3.59* *3.20* 

From this I was able to creat a chart in excel plotting the moving value of GPT in US$:




When GPT hit Aud$4.09 it was worth US$4.20 and although it hit a peak of Aud$4.14 the dollar was sliding and it was only worth US$4.15. On Friday GPT closed at Aud$3.59 worth US$3.20. The drop from US$4.20 to US$3.20 (almost 25%) must be hurting foreign investors big time. No wonder they are selling out. With the Aud$ expected to trade lower it would not be surprising to see the likes of GPT slip lower, posibly even testing the support level of $3.39. 

On the plus side, at some point, you would reasonably expect the yield, low price earnings ratio, discount to NTA, strength and diversity of assets, must start appealing to the same off-shore investors looking for long term returns. Has there been any upgrade/change to the earlier mentioned broker accumulate/buy ratings?


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## coolcup (4 August 2013)

nulla nulla said:


> On the plus side, at some point, you would reasonably expect the low price earnings ratio... must start appealing to the same off-shore investors looking for long term returns. H




I suspect you will find that the P/E you are stating includes revaluation gains (non cash in nature) in the denominator as earnings. REITs (like GPT) have to revalue their asset base every so often and any gain is passed through the profit and loss statement and hence pops up in REIT earnings. The gain is unrealised and is only actually captured by investors if the underlying asset is sold. Kind of like buying your house for $100 and saying it is worth $120 based on an independent valuation a few years later, and declaring a $20 profit that year to recognise the gain. There is nothing wrong with this per se but important to note that this is not like on like with earnings of general corporates which don't include reval gains (eg Woolworths earnings do not include reval gains). 

This therefore understates the P/E and why REITS tend to report "operating earnings" which strip out the reval gains and more closely align with the cash flow being generated by the underlying assets. On this basis, GPT's P/E is closer to 14-15x from memory, perhaps even higher.

In terms of what institutional investors are worried about, well the biggest concern is really how GPT manages to hit its long term earnings growth target of CPI + 2-3%. This implies ~5-6% earnings growth. The nature of the underlying assets provide longer term fixed rental growth of 3-4% which means there is a gap to bridge to get them to their 5-6% target. Management have been achieving this in recent history by buying their shares back accretively (which is getting harder given their P/E is much higher); cutting overheads (again limited in scope); cancelling out of the money hedges (which delivers an IRR of ~3.5% but boosts accounting earnings significantly). Now that this easy fruit has been taken, the question is how they will drive higher than CPI growth going forward. Also in an environment where retail tenants are flexing their muscles and demanding lower rents with GPT's portfolio exposed ~50% to retail from memory.


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## nulla nulla (4 August 2013)

coolcup said:


> I suspect you will find that the P/E you are stating includes revaluation gains (non cash in nature) in the denominator as earnings. REITs (like GPT) have to revalue their asset base every so often and any gain is passed through the profit and loss statement and hence pops up in REIT earnings. The gain is unrealised and is only actually captured by investors if the underlying asset is sold. Kind of like buying your house for $100 and saying it is worth $120 based on an independent valuation a few years later, and declaring a $20 profit that year to recognise the gain.




I'm not sure what point you are making here. Your quote is selective in that you have only referred to one of four points made as to why I think it is reasonable to think at some point soon, GPT should return to favour. The 2012 Annual Report released by GPT to the market on 14 February 2013, readily available per the ASX or GPT web sites clearly shows:

1. Net profit after tax of $594.5 million for year ending 31 December 2012...;
2. Realised operating income (ROI) of $456.4 million up 4.0% from December 2011;
3. ROI (Realised operating income) per ordinary security of 24.2cents...; 
4. Cash disrtribution of 19.3 cents per security, and
5. NTA per security of $3.73.

On page two of the release, the *Changes in fair value of Assets* is added in boostng earnings from the ROI  of $0.242 to the Iress/Huntleys sourced earnings per share figures in the table of $0.336. Security holders that receive their "distributions" (not dividends) also receive a covering tax note at the end of each fiscal year providing the break down of tax components including the taxable capital gain on revaluations passed on to the share holders/security holders.




coolcup said:


> There is nothing wrong with this per se but important to note that this is not like on like with earnings of general corporates which don't include reval gains (eg Woolworths earnings do not include reval gains).




Again I'm not sure the point you are trying to make. The structure of A-REIT's (mostly as stapled securities) is different to companies in other sectors. A-REIT's do "distributions" not "dividends", the tax treatment is different and no comparison with Woolworths or other non A-REIT's companies have been made. 



coolcup said:


> This therefore understates the P/E and why REITS tend to report "operating earnings" which strip out the reval gains and more closely align with the cash flow being generated by the underlying assets. On this basis, GPT's P/E is closer to 14-15x from memory, perhaps even higher.




As stated above, GPT reports "realised operating income" (ROI), last year $0.242 per share. Also GPT has a policy of trying to distribute arround 80% of ROI which is why the distribution was $0.193 cents per share.

Interestingly at the bottom of page one of the report under *"Guidance"* GPT indicates:

1. 2013 forcast EPS growth of at least 5%; and
2. Payout ratio of 80% of ROI .

There is a footnote (5) EPS defined as Realised operating income per ordinary security. I'm not sure you should be stripping out asset revaluations from earnings, particularly if there is a taxable component of capital gain included in the distribution.



coolcup said:


> In terms of what institutional investors are worried about, well the biggest concern is really how GPT manages to hit its long term earnings growth target of CPI + 2-3%. This implies ~5-6% earnings growth. The nature of the underlying assets provide longer term fixed rental growth of 3-4% which means there is a gap to bridge to get them to their 5-6% target. Management have been achieving this in recent history by buying their shares back accretively (which is getting harder given their P/E is much higher); cutting overheads (again limited in scope); cancelling out of the money hedges (which delivers an IRR of ~3.5% but boosts accounting earnings significantly). Now that this easy fruit has been taken, the question is how they will drive higher than CPI growth going forward. Also in an environment where retail tenants are flexing their muscles and demanding lower rents with GPT's portfolio exposed ~50% to retail from memory.




The "*outlook*" per page five of the release  was "cautiously optimistic for 2013....targeting growth in earnings per security of at least 5%". At this stage there haven't been any profit warnings from GPT and if I recall correctly even J.P.Morgan were recently rating it a "buy", after attending a GPT hosted office tour, with a target price of $4.33. 

Personaly I don't think that the current share price action is a result of "what institutional investors are worried about". The volumes traded are not indicative of "institutional investors" being concerned. To me the current price action is more likely the result of retail investors, that entered when the share price was less than $3.00, taking their profits before it falls further and offshore investors that bought in on the run up of the last year or so getting out before the fall in the Aud$ completely wipes out their capital gains.

However, I am not a financial adviser, which is why I generally end my posts with the note "do your own research and good luck".


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## coolcup (4 August 2013)

nulla nulla said:


> I'm not sure what point you are making here. Your quote is selective in that you have only referred to one of four points made as to why I think it is reasonable to think at some point soon, GPT should return to favour.




Hi mate

Apologies I did not mean to intimate that your conclusion regarding GPT was at all flawed. I am of a similar view that the A$ is hurting offshore investors as you have very rightly pointed out. Part of my work role is to speak regularly to the large institutional investors in the A-REIT space and I just wanted to point out a couple of things in which they differ to the analysis which you presented above (which is also perfectly valid):

1. The P/E ratio. I just wanted to point out that a 10x P/E for GPT might seem cheap as you indicated in your post, but what is this relative to? My assumption was that you are making it relative to the rest of the market. I just wanted to point out that revaluation gains can significantly boost earnings for REITs and institutional investors tend to look through this. Hence the true P/E that the sophisticated investors refer to is the price on GPT's operating earnings.You mentioned in your post that GPT states a Realised Operating Income number - this is the operating earnings I am talking about. On last year's number, the P/E is ~15x which is where instos tend to see GPT being priced relative to other stocks in the market.

The CGT components you see on your distribution statement are part of the realised gains which GPT has made during the period. The revaluation gain number in GPT's P&L will include these gains as well as unrealised gains as part of their general revaluation process. Generally if there is a one off profit on sale that is distributed, investors will not value these highly as they are not recurring in nature. In GPT's case, they decided to distribute the profits on the sale of an asset but keep other "ordinary course" profits so their overall payout ratio didn't increase to a level which wouldn't be sustained. Therefore, people are comfortable that their level of dividend is recurring and won't drop just because of a one off asset sale (ie it can be replaced with "ordinary course" income next year). Long story short, GPT would have paid the same dividend regardless of the profit on sale of the asset, which is why the market is happy to value it.

2. The earnings growth outlook. When it comes to REITs larger investors aren't generally concerned about earnings just one year out. Given the leases on the properties are long, there is a high degree of transparency around the future earnings prospects. The risk to GPT's growth profile which people are concerned about at present is whether they can keep the 5-6% EPS growth that they will hit this year up, going forward into future years. I suspect the low volumes we are seeing at the moment are typical of the absence of instos being willing to step up and by a stock trading at 15x earnings which may only grow 2-3% per annum over the longer term.

Sorry if my post was taken the wrong way. I was just trying to give some of my thoughts on the point you made regarding GPT's seemingly low P/E (and the fact that I don't think that is how the larger players in the market view the P/E) and also provide some insight in relation to your point at the end of the post regarding the fact that offshore investors would find GPT compelling soon (by outlining the concerns around earnings growth).

One final comment on GPT's stated operating earnings (ROI). This measure actually excludes a large coupon payment they make each year to GIC (Singapore Pension Fund) due to a hybrid they issued to GIC during the GFC. That coupon payment is quite large from memory and so a lot of investors take this into account as well due to it being a recurring payment. It is a bit cheeky on the part of GPT because it is like excluding part of your interest expense when determining your earnings number! GPT's payout ratio is 80% of ROI, but significantly higher based on actual operating earnings once the GIC hybrid coupon is taken into account.

Hope this clarifies my post a bit and sorry if it was not clear to begin with. I am not a big fan of GPT management myself, but that does not necessarily determine the price action. As always, the data is dissected many different ways and differing views is what makes a market!


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## nulla nulla (5 August 2013)

coolcup said:


> ........Part of my work role is to speak regularly to the large institutional investors in the A-REIT space.......




This would indicate that you may work for one of the A-REIT's or are a broker, unless of course you are like me and you phone the REIT "Investor Relations Managers" from time to time when you have a question, which they are usually happy to answer where it doesn't provide insider information (no matter how stupid I might sound).  



coolcup said:


> 1. The P/E ratio. I just wanted to point out that a 10x P/E for GPT might seem cheap as you indicated in your post, but what is this relative to? ....... On last year's number, the P/E is ~15x which is where instos tend to see GPT being priced relative to other stocks in the market..




The P/E figures quoted by me are relative to other A-REIT's (as per the weekly table I post in the A-REIT thread). Notwithstanding that there can be a difference between "Earnings" interpretaion (A-REIT v's non A-REIT's) that can be perceived to contribute to understating the P/E ratio, if the ratios were adjusted to the lower ROI figures increasing the P/E ratios, the A-REIT shares (in my opinion) would still compare favourably with other non A-REIT shares paying similar yields. 



coolcup said:


> 2. The earnings growth outlook. When it comes to REITs larger investors aren't generally concerned about earnings just one year out. Given the leases on the properties are long, there is a high degree of transparency around the future earnings prospects. The risk to GPT's growth profile which people are concerned about at present is whether they can keep the 5-6% EPS growth that they will hit this year up, going forward into future years. I suspect the low volumes we are seeing at the moment are typical of the absence of instos being willing to step up and by a stock trading at 15x earnings which may only grow 2-3% per annum over the longer term..




If institutional investor are looking for growth of 5-6% year after year, in a period when inflation is less then 3%, the world economies are contracted, unemployment is struggling to stay below 6% (even with the jiggling by both political parties as to the definition of "employmeny") and the only companies gouging huge profits are the banks, then in my opinion they are being unrealistic. Whether GPT has a P/E of 10:1 or 15:1 atm is relevent only in comparison of other shares when taken into consideration along with, distributions, yield, nta and share price to nta discounts. I personally believe that on this basis, with their current low debt levels, A-REIT's are a more secure investment for investors than many of the non A-REIT share in the ASX200.



coolcup said:


> One final comment on GPT's stated operating earnings (ROI). This measure actually excludes a large coupon payment they make each year to GIC (Singapore Pension Fund) due to a hybrid they issued to GIC during the GFC. That coupon payment is quite large from memory and so a lot of investors take this into account as well due to it being a recurring payment. It is a bit cheeky on the part of GPT because it is like excluding part of your interest expense when determining your earnings number! GPT's payout ratio is 80% of ROI, but significantly higher based on actual operating earnings once the GIC hybrid coupon is taken into account.




While I will make some enquiries in respect of how the "coupon" is treated, I suspect that there would be little difference to normal security holders as to whether it was accounted for/expensed in a manner similar to a recurring bond interest cost (expence) or as a distribution relative to a preference security/share holding. From memory Sydney Airport has/had a similar approach which was to the benefit of security holders in reducing tax.

I really think we are belaboring the point in this exchange as to the contextual relevence of P/E in the tables I post. As previously stated, I am not a financial adviser, my posts are not financial advice, I recommend to everyone to "Do Your Own Research". I am but a humble investor/trader trying to profit from understanding the moods swings that guide the market and cause the price of shares (in the A-REIT sector in this instance) to go up or down.

Cheers.


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## coolcup (5 August 2013)

nulla nulla said:


> Notwithstanding that there can be a difference between "Earnings" interpretaion (A-REIT v's non A-REIT's) that can be perceived to contribute to understating the P/E ratio, if the ratios were adjusted to the lower ROI figures increasing the P/E ratios, the A-REIT shares (in my opinion) would still compare favourably with other non A-REIT shares paying similar yields.




I agree, perhaps just not as favourably.



nulla nulla said:


> If institutional investor are looking for growth of 5-6% year after year, in a period when inflation is less then 3%, the world economies are contracted, unemployment is struggling to stay below 6% (even with the jiggling by both political parties as to the definition of "employmeny") and the only companies gouging huge profits are the banks, then in my opinion they are being unrealistic.




Totally agree. Only point I would make is that the company is saying they will target 5-6% year on year. The believability (if that is a word) of that is what the instos are questioning, just as you have.



nulla nulla said:


> Whether GPT has a P/E of 10:1 or 15:1 atm is relevent only in comparison of other shares when taken into consideration along with, distributions, yield, nta and share price to nta discounts.




Could not agree more. It is only relevant as a comparable measure. 



nulla nulla said:


> While I will make some enquiries in respect of how the "coupon" is treated, I suspect that there would be little difference to normal security holders as to whether it was accounted for/expensed in a manner similar to a recurring bond interest cost (expence) or as a distribution relative to a preference security/share holding. From memory Sydney Airport has/had a similar approach which was to the benefit of security holders in reducing tax.




Maybe I did not explain my point clearly. What I am saying is that GPT do not take the outflow from the hybrid into account in their ROI number at all. Let's compare two A-REITs: ALZ and GPT. Both have hybrids which require coupons to be paid. ALZ's operating earnings number includes the expensing of the hybrid coupon. GPT's operating earnings number does not. So in effect, GPT is saying its earnings are higher, when in fact they need to pay the coupon on the hybrid prior to paying distributions to securityholders. In other words, it is not an apples for apples comparison between ALZ and GPT to look at their operating earnings numbers. But, since you look at total earnings including revaluation gains from the annual report, I think you should be fine. 



nulla nulla said:


> I really think we are belaboring the point in this exchange as to the contextual relevence of P/E in the tables I post.




I apologise for belaboring the point. I did not reflect on the tables that you post and have no issue with them. I just saw in your post that you said GPT trades on a P/E of 10x and wanted to explain why I don't think the market actually values them at 10x but more like 15x. As you say though, that is still a fair bit cheaper than a large number of industrial stocks which are far more exposed to the general economy than GPT is.

I think we are on the same page. I did not mean to criticise you or your analysis. I was just trying to provide some additional insights. I won't reply to any of your A-REIT posts in future since I am obviously coming across too critically.

All the best.


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## skc (5 August 2013)

coolcup said:


> I apologise for belaboring the point. I did not reflect on the tables that you post and have no issue with them. I just saw in your post that you said GPT trades on a P/E of 10x and wanted to explain why I don't think the market actually values them at 10x but more like 15x. As you say though, that is still a fair bit cheaper than a large number of industrial stocks which are far more exposed to the general economy than GPT is.
> 
> I think we are on the same page. I did not mean to criticise you or your analysis. I was just trying to provide some additional insights. I won't reply to any of your A-REIT posts in future since I am obviously coming across too critically.




Stop being so apologetic... both of you! Great discussion by you two and I appreciate the views from both of you. The REITs have relatively weak of late and I think it's probably to do with the market now basically seeing past the bottom of the rate cycle. The $A falling also doesn't help, and I am not sure the upcoming reporting season will bring much positive catalysts either (perhaps some in the residential space). There doesn't seem a great deal of top line growth beyond inflation, so total return of 10-12% might be hard to achieve despite the dividends of ~6% accounting for half of that.

As a substitute to bank deposit, the REITs are probably not terrible for a retail holder. But as an equity investment it may not be as attractive as other industrial or financial stocks.


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## nulla nulla (5 August 2013)

coolcup said:


> I did not mean to criticise you or your analysis. I was just trying to provide some additional insights. I won't reply to any of your A-REIT posts in future since I am obviously coming across too critically.
> 
> All the best.




You are a big boy now, don't be so sensitive to robust discusion. 

Criticism is fine when it is constructive and substantiated. Australia is still a democracy and we have fredom of the press and freedom of speech. Anyone is entitled to comment in respect of my posts regardless of the thread. 

It is called discussion/contribution whether it is in agreement or oposition. Otherwise the threads would be a boring monologue. Can't have that. The whole idea of the threads is to get constructive input from as many members as possible. How else would I have learned that J.P.Morgan were recommending GPT a while back (before the price fell). 

Oh and the price fell even further today. The RBA decision is out tomorrow and the share rpice may fall even further if there is a further drop in the Aud$. All good, GPT will eventually bounce (IMO).

Cheers. 

As always, do your own research and good luck.


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## nulla nulla (6 August 2013)

nulla nulla said:


> .......The RBA decision is out tomorrow and the share price may fall even further if there is a further drop in the Aud$. All good, GPT will eventually bounce (IMO).
> 
> Cheers.
> 
> As always, do your own research and good luck.




The RBA interest rate decision came out, a further rate cut of 25pts....and GPT bounced 4.5% with good turnover. Eventually came sooner than I expected???? I wonder if they will get a speeding ticket?

Go figure, do your own research and good luck.


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## coolcup (12 August 2013)

coolcup said:


> In terms of what institutional investors are worried about, well the biggest concern is really how GPT manages to hit its long term earnings growth target of CPI + 2-3%. This implies ~5-6% earnings growth. The nature of the underlying assets provide longer term fixed rental growth of 3-4% which means there is a gap to bridge to get them to their 5-6% target. Management have been achieving this in recent history by buying their shares back accretively (which is getting harder given their P/E is much higher); cutting overheads (again limited in scope); cancelling out of the money hedges (which delivers an IRR of ~3.5% but boosts accounting earnings significantly). Now that this easy fruit has been taken, the question is how they will drive higher than CPI growth going forward. Also in an environment where retail tenants are flexing their muscles and demanding lower rents with GPT's portfolio exposed ~50% to retail from memory.




Having read the majority of the broker research following GPT's interim result today, the key theme coming out of the research echoes the views I expressed earlier, extracted in the quote above. Namely, GPT management have admitted that hitting their earnings growth target of CPI +1% growth in FY14 will be a challenge. Particularly given comparable rental growth in their office and retail portfolios is close to zero and the low hanging fruit has been picked off.


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## nulla nulla (13 August 2013)

coolcup said:


> Having read the majority of the broker research following GPT's interim result today, the key theme coming out of the research echoes the views I expressed earlier, extracted in the quote above. Namely, GPT management have admitted that hitting their earnings growth target of CPI +1% growth in FY14 will be a challenge. Particularly given comparable rental growth in their office and retail portfolios is close to zero and the low hanging fruit has been picked off.




It will be interesting to see whether the market likes the $0.05c div and pushes the price up today/tomorrow before GPT goes exdiv on Thursday or whether the cautious outlook for growth of cpi+1% going forward is seen as a negative and the market sells GPT down. 

No doubt GPT will drop by at least $0.05 on Thursday/Friday after it goes ex-div. Realistically, to be delivering growth and improved distribution in the current economic environment, GPT is still outperforming many other A-REIT shares as well as shares in other sectors.

As always, do your own research and good luck.


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## nulla nulla (28 September 2013)

The Three year chart for GPT shows the steady climb of the share price as the market (herd) continued to warm to the strengths of GPT's Board & Management and the consistancy of their results. No doubt the improving yield helped as well. A retrace (falls in the Aud$ v's the US$) followed buy a surge (the foreign yield chasers using low interest borrowings) followed by another retrace (further falls in the Aud$ versus the US$) another surge (dead cat bounce) then a steady fall. A head and shoulder pattern if ever there was one. Left shoulder higher than the right shoulder and the nay-sayers in the herd start running arround screaming "the sky is falling, sell sell".




The Half Yearly report has plenty of good news but the analysts tend to overlook the "what a great job we've done" aspects and focus on the "batten the hatches, difficult conditions ahead" aspects. Rats start deserting the ship, not having the mental capacity to consider that the directors and management might have the ability and skills to guide the ship through the stormy weather to safe harbours ahead. The share price falls further and tests the previous support levels of $3.54.

The figures speak for themselves:


*	Share:	*  *	GPT	*    *	Date:	*  *	27-Sep-13	*    *	Closing Price	*  *	3.52	*  *	Issued Shares	*  *	1,694,888,368	*  *	Capital	*  *	5,966,007,055	*  *	Earnings $	*  *	0.3360	*  *	ROE	*  *	9.55%	*  *	Dist $	*  *	0.198	*  *	Yield %	*  *	5.63%	*  *	P/E	*  *	10.48	*  *	NTA $	*  *	3.73	*  *	Discount to NTA	*  *	5.63%	* 


How many time have we heard that "the market is never wrong"? Yet, obviously, from time to time the market does get it wrong and then corrects itself. Or is this simply the smart money pushing the market down so they can acumulate before pushing it back up again? The RSI chart suggests that the share price of GPT is slightly oversold:




The MACD chart shows that GPT share price is moving in a tight downward spread and the converging and diverging gaps are tighter than normal (the multiple moving averages chart is to scary to show here, children would have nightmares and grown men could weep):




And yet, the comparative chart for the last twelve months with SGP (who once aspired to take over GPT) shows that SGP has resurged in the present conditions while GPT has been abandoned, why?




GPT has a NTA of $3.76, their debt gearing of 19.9% is one of the lowest of all the A-REIT's if not the lowest. One of the leading brokers suggested in June of this year that GPT had a target price of $4.33. Yet GPT has fallen 15% from their recent high of $4.16 (hit $4.20 interday) to $3.52. The Aud$ has fallen roughly 13% from the April level of US$1.06 to the current level arround US$0.94. This smacks of an over-reaction or something working behind the scenes.

To me it simply doesn't ring true. When GPT was making a play for Australand it was the darling of the A-REIT's. Not only did the share price of Australand (ALZ) go up but so did GPT. When GPT announced that they would not pursue ALZ both share prices dipped but not that much to be worried about. Curiously when Dexus made a play for the management rights of CPA (and was rumoured to be trying to finance a buyout scrip/cash offer for CPA) the share price of GPT seemed to slump even more. This despite the head honcho of GPT reminding the market that GPT has a war chest of $2 billion plus available. This with a gearing of only 19.5%!  At this point I feel that I am out of synch with the rest of the market. I see GPT as having the capacity to swallow Dexus (DXS) and Commonwealth Offices (CPA) then divest the less desirable assets to other A-REIT investors such as the Singapore Superanuation Fund or the Canadian Teachers Superanuation Fund etc etc.

Then again, what would I know, mind you if I worked for one of the big merchant banks, this is the sort of deal I would be trying to stitch together. The fees (bonus) would be fantastic and the long term winners would be the share holders all around.  As always do your own research and good luck.


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## nulla nulla (1 October 2013)

The 18 Month Chart for GPT shows that the share price is back where it was a year ago (give or take a few cents). The $3.54 support line was well and truly breached yesterday with GPT closing the day on $3.48. Interestingly the daily volumes on the sell down haven't been high suggesting that the sell down is probably related to the global hiccups brought on by the uncertainty of the US quantative easing combining with the very present political stoush in the US Congress between the Democrats and Republicans in respect of the US debt ceiling. It is likely that when this is resolved some confidence will return to the markets (hopefully including GPT).




The folowing chart is the Multiple Moving Averages as at yesterdays close (the one I didn't post on the weekend for fear of scaring children etc). The finger spread across all averages suggests that GPT has not yet reached it's turning point and may have further to go. Yesterdays outcome could have been a Capitulation point where the smart money came in and started to buy. However the volumes don't make this look likely. As allways do your own reasearch and good luck.


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## nulla nulla (28 October 2013)

It is about time we heard from the management of GPT. It is all very well to have really low debt gearing, high occupancy and to have a war chest of $2 billion plus, but it is pointless if no-one knows what they intend to do with it and where the management and board see GPT going in the future.




Todays announcement was well received by the market, even if volumes were still relatively low. It will be interesting to see if there is any flow on from tomorrows press coverage. As always do your own research and good luck.


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## coolcup (28 October 2013)

nulla nulla said:


> It is about time we heard from the management of GPT. It is all very well to have really low debt gearing, high occupancy and to have a war chest of $2 billion plus, but it is pointless if no-one knows what they intend to do with it and where the management and board see GPT going in the future.
> 
> View attachment 54980
> 
> ...




Hi nulla nulla

I have noticed a few other REITs heavily weighted to retail beginning to show positive signs and charts similar to GPT (eg WRT and CFX). Do you think there is a shift in sentiment towards retail driving this? I wonder how sustainable this is...


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## nulla nulla (29 October 2013)

coolcup said:


> Hi nulla nulla
> 
> I have noticed a few other REITs heavily weighted to retail beginning to show positive signs and charts similar to GPT (eg WRT and CFX). Do you think there is a shift in sentiment towards retail driving this? I wonder how sustainable this is...




I find it a little perplexing with retail based A-REIT's at the moment. Industry and the media has been talking up slow improvement in retail sales for some time but the market pushed A-REIt's with retail exposure down (CFX, GPT, SGP & WRT) and appears to have pretty much kept the sector down since with only modest improvement. 

I consider these share were pushed down below intrinsic value and welcomed the trade opportunities in the rebounds from being oversold. Ones like SCP in the low $1.50's was hard to overlook although the volumes are lowish and the rebound slow, it is now back to $1.58 - $1.60. WRT was a no brainer from $2.91 to $3.10. and CFX very inviting anytime it dipped to $2.01 or lower (although CFX has a tighter spread and ergo more risk with the capital levels required to take a quick trade). SGP took off earlier than the rest, rebounding on their exposure to residential which is back in demand.

GPT seems to be lagging and in my opinion is way overdue for a bounce, even if only to keep it in line with the likes of SGP, WRT and CFX. As always everyone should do their own research. Good luck


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## nulla nulla (16 November 2013)

GPT continues to lag the rest of the A-REIT market. Lately it seems to have a resistance level arround $3.74 - $3.75. When it challanged $3.76 early this week I started to get hopefull it might be the start of a run up to $3.80+. Unfortunately it fell back to sub $3.70 and I picked up another parcel at $3.68 for an overnight trade up to $3.73.




I'm starting to get concerned that the market is losing faith with the GPT Management and Board. Recent announcements about their strategy and acquisition plans have failed to provide any sustained lift in investor interest, volume of share turnover, share price improvement etc.  It seems generating good returns and having one of lowest gearing ratios, if not the lowest, is not enough for the market. Seems the market wants to see growth (like Dexus) even if it means pushing the gearing ratios up to 35% plus. In my opinion GPT is way over due for a good bounce but it just doesn't seem to be happening. As always do your own research and good luck.


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## coolcup (16 November 2013)

nulla nulla said:


> I'm starting to get concerned that the market is losing faith with the GPT Management and Board.




As mentioned in an earlier post, investors are concerned about GPT's earnings growth prospects. They have targeted CPI+1% through the cycle in earlier announcements which they dropped at their recent strategy review. All the low hanging fruit is gone: they have cut costs, broken hedges and bought back stock. There are not many easy pickings for them now and they have failed spectacularly at a number of large scale acquisitions (Australand, APPF Industrial and CPA) meaning even driving growth through acquisition looks difficult.


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## nulla nulla (19 November 2013)

Looks like GPT may not miss out on scooping up CPA after all. GPT today announced a superior scrip and cash take-over offer for CPA of $1.272 per share trumping the bid of $1.205 offered by Dexus. Will Dexus up the anti?


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## laurie (19 November 2013)

We don't need to get  into a bidding war!


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## skc (19 November 2013)

nulla nulla said:


> Looks like GPT may not miss out on scooping up CPA after all. GPT today announced a superior scrip and cash take-over offer for CPA of $1.272 per share trumping the bid of $1.205 offered by Dexus. Will Dexus up the anti?




Definitely a surprise considering that DXS already had 15% of CPA locked up. GPT took their sweet time and they could have put in the bid before DXS raise its offer. The price of 7% above NTA is also quite a premium.

All in all it feels like a move that is more concerned about getting bigger, rather than a very compelling deal in its own right.

GPT should have put in a left-field offer for IOF or something when it was trading at 5% discount to NTA when the DXS/CPA deal was first announced.


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## coolcup (19 November 2013)

Interesting that the market has sent GPT shares down 1.5% on the news. Again, goes to confidence in management's strategy. What do these assets really bring to GPT aside from the small upfront accretion...


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## nulla nulla (19 November 2013)

coolcup said:


> Interesting that the market has sent GPT shares down 1.5% on the news. Again, goes to confidence in management's strategy. What do these assets really bring to GPT aside from the small upfront accretion...




The initial market reaction was to send GPT down $0.06 but then it recovered $0.02. The volume of turnover is fairly low. I suspect the market is taking a more "wait and see" perspective. 

From todays price action on CPA, with good volume, it also looks like the market is not expecting a bidding war. The price action around $1.26 being pretty much in line with the offer of GPT and the prospective dividend from CPA. From the price action on Dexus it looks like the market didn't thing much of their market release "We are doing due dilligence and have no comment at this stage"

When GPT made an offer for Australand, the market initially sold GPT down a little then pushed it up significantly. If successful, I think it is likely that GPT would keep the core assets of CPA and sell off the non core assets. Obviously there would be synergies for bringing the management in house with the existing management team. Probably ask Canadian Pensions if they want the non core assets (?)


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## coolcup (19 November 2013)

nulla nulla said:


> The initial market reaction was to send GPT down $0.06 but then it recovered $0.02. The volume of turnover is fairly low. I suspect the market is taking a more "wait and see" perspective.
> 
> From todays price action on CPA, with good volume, it also looks like the market is not expecting a bidding war. The price action around $1.26 being pretty much in line with the offer of GPT and the prospective dividend from CPA. From the price action on Dexus it looks like the market didn't thing much of their market release "We are doing due dilligence and have no comment at this stage"
> 
> When GPT made an offer for Australand, the market initially sold GPT down a little then pushed it up significantly. If successful, I think it is likely that GPT would keep the core assets of CPA and sell off the non core assets. Obviously there would be synergies for bringing the management in house with the existing management team. Probably ask Canadian Pensions if they want the non core assets (?)




Unlikely CPPIB will want the non-core stuff. They are only interested in the trophy assets. 5 core assets are being sold to GPT's wholesale office fund GWOF with the remainder being held on balance sheet. The suburban office assets will likely be sold into GPT's new metropolitan office fund which they are currently seeding.

DXS wins either way. They either win the CPA assets or they get a more handsome premium for the 14.9% stake if GPT win the bid. GPT's bid has no due diligence conditions, which as an investor would make me nervous that management are pushing too hard to get a deal done. I think it would have been much more sensible for them to look at IOF while DXS was preoccupied on CPA.


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## nulla nulla (20 November 2013)

coolcup said:


> Unlikely CPPIB will want the non-core stuff. They are only interested in the trophy assets. 5 core assets are being sold to GPT's wholesale office fund GWOF with the remainder being held on balance sheet. The suburban office assets will likely be sold into GPT's new metropolitan office fund which they are currently seeding.
> 
> DXS wins either way. They either win the CPA assets or they get a more handsome premium for the 14.9% stake if GPT win the bid. GPT's bid has no due diligence conditions, which as an investor would make me nervous that management are pushing too hard to get a deal done. I think it would have been much more sensible for them to look at IOF while DXS was preoccupied on CPA.




The comment about the "non core asset offload to the Canadians" was tongue in cheek. I suspect that GPT and the DXS consortium both have their eyes on the same key properties. No doubt when they have completed due dilligence the DXS consortium will be better placed to assess whether or not there is enough synergy in the merger/take-over of CPA for them to sweeten the deal.

As to IOF, I suspect it is too tightly held by the majority shareholders to be an easy target. Dexus would certainly make a profit by selling their 13.5% stake pg CPA acquired at $1.135 into the GPT bid. With the CPA div they would make arround $0.135 per share, arround 12% for a couple of months investment.


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## coolcup (20 November 2013)

GPT down another 1.5% as I type. DXS up 0.5%. The market is clearly backing the more believable bid.

GPT's strategy is to acquire CPA via a takeover and sell down 5 assets to GWOF. To execute this strategy they need to get to 90% for compulsory acquisition of CPA to force such sales through. DXS holds 15% so this isn't possible. GPT were asked on the conference call what they would do if they didn't get to full control, the CEO's reply was "rational heads will prevail". He used the same words when describing his tilt at Lend Lease's industrial fund. 

They are desperate to prevent DXS getting control of these assets but have no real means to dislodge them. If DXS match GPT's approach and pay CBA (the current manager) nothing and instead use those funds to pay CPA holders, they can match GPT's bid plus more given the way the relative share prices have moved since GPT's announcement. Well played GPT...not.


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## nulla nulla (20 November 2013)

coolcup said:


> GPT down another 1.5% as I type. DXS up 0.5%. The market is clearly backing the more believable bid.




At close of market the entire A-REIT sector is down 1.16%. Dexus is down 0.47% and GPT is down 1.66% in the closing auction Dexus dropped half a cent while GPT lifted by one cent. You have to remember that tomorrow is options settlement day for this month and it is not unusual for the market to be pushed down the day before. I'm not choosing sides, I'm happy to trade both dxs and gpt, but I wouldn't put too much into todays price actions as an indicator of the markets support for either bid. Subject to Dexus revising their bid, at this point in time GPT has the superior bid for the CPA shares. 



coolcup said:


> GPT's strategy is to acquire CPA via a takeover and sell down 5 assets to GWOF. To execute this strategy they need to get to 90% for compulsory acquisition of CPA to force such sales through. DXS holds 15% so this isn't possible. GPT were asked on the conference call what they would do if they didn't get to full control, the CEO's reply was "rational heads will prevail". He used the same words when describing his tilt at Lend Lease's industrial fund.




I have to correct my early post, the papers indicated this morning, if successful in their bid GPT will sell six (6) prime assets into GWOF. If GPT gains control of 85% of CPA then Dexus will have two choices, either sell into the bid and make approximately $43 million dollars profit or continue to hold their shares and be completely at the mercy of GPT. I suspect the prospect of walking away with $43 million would influence any "rational heads to prevail".



coolcup said:


> They are desperate to prevent DXS getting control of these assets but have no real means to dislodge them. If DXS match GPT's approach and pay CBA (the current manager) nothing and instead use those funds to pay CPA holders, they can match GPT's bid plus more given the way the relative share prices have moved since GPT's announcement. Well played GPT...not.




I suspect if Dexus were to up their anti to outbid GPT, their existing offer to buy out management control from CBA would still be binding. It would become a very expensive exercise. The volume of turnover on CPA today would suggest that either or both parties are increasing their holdings to the extent allowed. I'm happy to sit back and wait to see the outcome. I suspect CPA holders are going to prefer an offer that completes quickly and is not subject to the delays per Dexus's existing offer. As I said, I am impartial as to who wins.


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## coolcup (20 November 2013)

Will be interesting to see how this plays out. My understanding is most "long only" traditional institutional holders have now exited CPA and the register is full of hedge funds. Most of these instos are extremely annoyed at GPT's approach because it is effectively taking money out of their pockets (they are heavily invested in GPT) and putting it into the pockets of the hedge funds. It hasn't been received well by the domestic property security funds.


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## nulla nulla (21 November 2013)

coolcup said:


> Will be interesting to see how this plays out. My understanding is most "long only" traditional institutional holders have now exited CPA and the register is full of hedge funds. Most of these instos are extremely annoyed at GPT's approach because it is effectively taking money out of their pockets (they are heavily invested in GPT) and putting it into the pockets of the hedge funds. It hasn't been received well by the domestic property security funds.




Thats interesting. It is the sort of thing that isn't evident in media releases or comments from Analysts to Journo's but would exist in the background. No doubt their "annoyance" would flow through to their trading decisions as well. Even instos are human. You obviously have access to more info than from just reading the releases and observing the market. I posted a link in the CPA thread to an article by Carolyn Cummins in todays fairfax BusinessDay:

http://www.smh.com.au/business/dexus-set-to-up-the-ante-in-cpa-battle-20131120-2xvs0.html

Your earlier comment re share price movement indicating market support or lack of it for the DXS or GPT offer is also supported, "Fund managers said the share price movement over the next couple of days would give an indication as to which offer investors were prefering". 

The timing of the GPT bid in proximity to todays options settlement clouds the crystal ball a little (as well as the CapitaLand sell down of their Australand holding). The article above also indicates that Dexus has to respond to the bid from GPT within three days, which is today? I guess we are just going to have to wait and see how it pans out.


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## nulla nulla (6 April 2014)

Well the pan out was a withdrawal of the GPT bid after they entered into an agreement with Dexus to carve up the CPA assets when Dexus completes the purchase of CPA. Even though GPT was effectively unshackled from the CPA bid the GPT share price did not rebound to and hold previous levels, prompting GPT to resume their buy back when the share price retreated to $3.60. It would seem that the fund managers (as outlined above) may still be annoyed with the GPT bid.  Obviously the GPT share price would also be impacted like the rest of the A-REIT Sector by the international goings on, Crimea, Chinese Shadow Banking, the easing of Quantative Easing and Glen Stevens jawboning the Aussie economy. 





Personally I think GPT is way overdue for a bounce but that is only my two cents worth. As always do your own research and good luck.


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## nulla nulla (9 April 2014)

nulla nulla said:


> ...
> Personally I think GPT is way overdue for a bounce but that is only my two cents worth. As always do your own research and good luck.




$3.69 to $3.80. I think I could reasonably call this a bounce. The whole A-REIT sector bounced today. There may still be some legs left in this run. Still holding two parcels will see where it goes while watching for cautious re-entry levels.




As always, do your own research and good luck.


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## nulla nulla (11 April 2014)

Dropped the remaining parcels today. The first at $3.85 on open and the second late in the morning when GPT hit $3.88.




I was surprised at the volume of shares that turned over at $3.88 and indeed for the day. I can't work out whether shorters felt the need to close out their positions or whether the fund managers have forgiven GPT for the CPA exercise. However, while the share price retraced towards the end of the day, it still closed above the previous days closing price. We are sitting out for now to see whether GPT can go higher from here or retraces. As always, do your own research and good luck.


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## nulla nulla (24 June 2014)

There seems to be a resistance level at $3.98. GPT is due to go ex-div this week. It will be interesting to see if the share price falls below the recent support level around $3.85 or rebounds quickly. Seems A-REIT's have been enjoying a little time in the spotlight with sustained climbs since late March early April 2014. GPT seems to have shrugged off the unsuccessful tilt at ALZ as well as coming out well from the carve up of CPA. Perhaps it is time for GPT to push back above $4.00 and stay there???? As always, do your own research and good luck.


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## nulla nulla (28 June 2014)

Not bad, went ex-div at $3.94, dropped to $3.85 and then went on the rebound to $3.95.




As always do your own research and good luck.  

P.S. watch out for any portfolio re-weighting on Monday.


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## nulla nulla (12 July 2014)

GPT seems to be range bound between $3.85 and $3.97 for the last few weeks. 




Trading in an even tighter range for the last week or so (between $3.87 and $3.92) my frustration sitting in the queue at $3.85 to have a bid filled isn't helped when Mr's nulla jumps in at $3.87 and out at $3.92 for a couple of quick modest sized trades. Bloody front runners


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## nulla nulla (10 August 2014)

The last time I bought GPT above $4.00 the tsunami of foreign investment money evaporated and I took the losses at $3.75 before 30 June 2013 for a tax offset against our accrued capital gains for 2012/2013. 

The next time I tried to trade GPT above $3.80 the market sent the share price down to $3.36. This time I didn't have the short term opportunity to offset capital losses against accrued capital gains for tax minimization and I elected to "ride it out" and take the dividends, confident that GPT would recover above the $3.80 entry point.....eventually. 

Two dividends and nine months later my trades came back into the black and we locked in our profit closing out the positions for profits (combined capital gain and divs) greater than 6%. Better than bank rates but poor in comparison with the returns on the rest of our investment funds which hadn't been locked in during those nine months.

Even though we have traded a few parcels of GPT between April and July, as it tracked sideways ranging between $3.84 and $3.98, you can probably understand my reluctance to jump in above $4.00. 


	Code				Closing Price					Capital				Earnings $				ROE				Dist $					Yield %					P/E				NTA $				Premium to NTA		           GPT  *	4.000	*​  6,741,843,820​  0.3150​  7.88%​  0.2040​  * 5.10%​ *  12.70​  3.79​  5.54%​ 

Reporting season is coming up. GPT has come out of the CPA take over battle in a win win situation, their funds from operations should be higher, their debt ratio will no doubt be higher than the previous level of 22% but it should be reasonably under their maximum comfort level of 35%, their yield levels are good and their price earnings ratio is one of the lowest of shares in the A-REIT sector. However, at this point I still think there are better low risk trade opportunities else where and I will wait until GPT demonstrates it can hold this level going forward before I risk my dollars. As always do your own research and good luck.


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## nulla nulla (29 March 2015)

Seven months on and the GPT share price has managed to stay above $4.00. However having hit a high of $4.89 on February 5th, 2015 the share price has now tracked sideways and down to lows of $4.51 on 18 March 2015 with a latest close of $4.60 on Friday 27 March 2015. 





	Code	 *	Closing Price	* 		Capital				Earnings $				ROE				Dist $					Yield %					P/E				NTA $				Premium to NTA		           GPT  *	4.600	*​  8,170,902,784​  0.3827​  8.32%​  0.2120​  * 4.61%​ *  12.02​  3.94​  16.75%​ 


Still too tight and unpredictable for me to trade. The weekend article in the Sydney Morning Herald that GPT may be lining up Investa for a take over doesn't encourage me to loosen the purse strings either. As always, do tour own research and good luck.


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## skc (29 March 2015)

nulla nulla said:


> Still too tight and unpredictable for me to trade. The weekend article in the Sydney Morning Herald that GPT may be lining up Investa for a take over doesn't encourage me to loosen the purse strings either. As always, do tour own research and good luck.




Investa is a BIG prize (and a BIG bite for most)... but imo whoever manage to win the race will be well received (provided that they didn't overpay).


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## nulla nulla (20 March 2017)

There hasn't been a lot of recent activity in this thread so I though it may be worthwhile throwing up a long term chart as well as a table comparing the share information over the past three or so years.














Disclaimer: The table information is taken from the A-REIT Tables posted previously. Accordingly if there were any errors in those tables then they have been repeated in this table.


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## Trav. (29 October 2020)

I purchase GPT this week @ 4.15 as part of my system and currently down as it closed yesterday @ 4.11 which is no big deal.

Announcement out today - *September Quarter Operational Update *so we will see how the market likes this and I suspect that the ASX is not going to have a good day as well

Extract below......


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## Trav. (2 November 2020)

GPT closed @ $4.03 last week and hopefully $4 will hold

Announcement out as per extract below.


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