# ING - Inghams Group



## hamli (13 October 2016)

Anyone else considering this IPO?

Positive:
- Poultry steady increase year on year, vs red meat showing decline in recent years. Poultry viewed as a healthier choice.
- Due to tough quarantine regulation, little poultry is imported, so there is little competition.
- Market leader
- Reasonable PE ratio vs consumer staples sector

Negative:
- Government protective of local agriculture vs Asian foreign owners
- Little export opportunity for poultry - due to higher operating costs in Australia vs other foreign exporters.
- Growth in EBITDA is partly driven by cost savings (most likely once off) and partly through sales increase.

What do you people think?


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## nioka (13 October 2016)

*Re: Inghams Group IPO*



hamli said:


> Anyone else considering this IPO?
> 
> Positive:
> - Poultry steady increase year on year, vs red meat showing decline in recent years. Poultry viewed as a healthier choice.
> ...




I personally knew Bob and Jack Ingham in the early days of the poultry industry. I was in the industry at the time as a manager of an opposition business. They worked hard and built a great business. Bob was the organiser. You could talk with him most hours 7 days a week. Hard dealing but ethical. It was his management that made it a great company but it was a company run privately without the overhead of a public company structure. Over the years Jack became more interested in his race horses and left Bob to run the poultry business.

With Bobs retirement and the passing on of Jack a few years ago it is now a different kettle of fish. What sort of results from this point on is up to a new generation of management. The upper level of general management that made the business have aged and passed on.

The do dominate the industry at this stage but with the advent of Aldi and others into the retail market that may change. Chicken is still the best "meat" value in the food market and should hold onto that ticket for some time.


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## Wysiwyg (13 October 2016)

*Re: Inghams Group IPO*

Chicken is chicken to most people and not a niche product. Buying the cheapest chicken is the buyer of today and Inghams chicken (especially the cardboard box varieties) are the more expensive. These days it's less about reputation for quality, which is Ingham chicken, and more about price. Bit like buying Tassals smoked salmon or rib fillet steak if you're on 100k plus a year.

Saturated market? Scalable? Innovative? KFC contract?


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## Value Collector (13 October 2016)

Hey Guys,

I Just quickly scanned the offer document this afternoon, I wanted to see what their return on equity was, and it looks to me like the company has a negative equity position.

I haven't looked very deep at this yet, just as I said a quick scan, But does anyone know the reason for this eg have the owners extracted the equity and leveraged up the company prior to this listing?


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## nioka (13 October 2016)

Value Collector said:


> Hey Guys,
> 
> I Just quickly scanned the offer document this afternoon, I wanted to see what their return on equity was, and it looks to me like the company has a negative equity position.
> 
> I haven't looked very deep at this yet, just as I said a quick scan, But does anyone know the reason for this eg have the owners extracted the equity and leveraged up the company prior to this listing?




In a case like this it is hard to put a dollar value that satisfies the bean counters. The organisation has contract growers and has no dollar value in the eyes of an auditor on that part of the organisation although it does have value there. The float is there for the Ingham family to realise a return on 50 plus years of nurturing a business. They will also be looking at their tax position. The value will eventually be decided by the market putting a value on the business based on what it will return to shareholders. All plant and equipment will have been written down to the maximum for tax purposes. It is probably a lot more valuable that the books will show. 

The company should be valued on what it will do for shareholders from here on. You need to be a fly on the wall to work this out. If you need to eliminate risk then you sit back and buy after listing.


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## hamli (13 October 2016)

Tegel was offered at a lower P/E earlier on in year. Settled at ~5% gain on listing, had a nice rally, but now trading below IPO. Makes me question my earlier comment about a this IPO having a reasonable P/E.

Ingham is looking less attractive. I will probably choose to lock up my capital elsewhere, and monitor Inghams from the side line.


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## nioka (13 October 2016)

hamli said:


> Tegel was offered at a lower P/E earlier on in year. Settled at ~5% gain on listing, had a nice rally, but now trading below IPO. Makes me question my earlier comment about a this IPO having a reasonable P/E.
> 
> Ingham is looking less attractive. I will probably choose to lock up my capital elsewhere, and monitor Inghams from the side line.




You can't compare Tegels with Inghams. Tegels are small fry in the Industry, Inghams are leaders and really are the big boys in the industry.


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## galumay (13 October 2016)

nioka said:


> You can't compare Tegels with Inghams. Tegels are small fry in the Industry, Inghams are leaders and really are the big boys in the industry.




I am not sure that market share is a particularly useful metric. RFP, which is listed on the NSX has only about 5% of the market, but from my research would be one of the most profitable. 

I havent taken the time to look at Inghams in any detail so I cant really comment on whether the IPO is attractive or not.


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## So_Cynical (13 October 2016)

nioka said:


> You can't compare *Tegels with Inghams*. Tegels are small fry in the Industry, Inghams are leaders and really are the big boys in the industry.




Small fry in Aust but a major NZ player according to them.



			
				http://investors.tegel.co.nz/media/1060/160809-tgh-philippines-announcement.pdf said:
			
		

> Tegel Group Holdings Limited (NZX/ASX: TGH) processes approximately 50 million birds per year,
> across vertically integrated operations in Auckland, Christchurch and New Plymouth. It is New
> Zealand’s leading poultry producer, *processing approximately half of New Zealand’s poultry*, and
> also manufactures and markets a range of other processed meat products




Tegal are exporting so why not Inghams? Tegal would surely be a T/O target for a listed Inghams?


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## Value Collector (13 October 2016)

Value Collector said:


> Hey Guys,
> 
> I Just quickly scanned the offer document this afternoon, I wanted to see what their return on equity was, and it looks to me like the company has a negative equity position.
> 
> I haven't looked very deep at this yet, just as I said a quick scan, But does anyone know the reason for this eg have the owners extracted the equity and leveraged up the company prior to this listing?




Ok guys, so I think I may have found the reason behind the missing equity, and it's the magic of private equity.

In 2013, Bob Ingham sold the entire chicken Business and the associated properties to TPG Entities for $880 Million.

In 2014, TPG Entities sold all the property/ realestate for $550 Million to outside real estate investment trusts like charter hall, these assets included the office building, their feed mills, processing plants, distribution centres, hatcheries, grow out facilities etc.

Now the company rents these properties back on 20-25 year leases.

So now TPG ENTITIES, only have about $330 Million left in the deal, (they may have even got that back by getting the company to take on debt to pay them out)

So when this lists, TPG will be trying to sell 75% of the remaining indebted operating business, for $1.1 Billion, leaving them with 25% ownership.

So in short,

TPG paid $880M to Bob,

Then TPG got,

$550 Million from selling the realestate,
($400M potentially from leveraging the company)
$1100 Million from the listing
25% ownership in the listed business.

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

I am not saying any of this is wrong, just answers my initial query about where all the assets were.

The company will probably still operate as a sound investment if it is managed well into the future, but I think the realestate not being part of the deal anymore makes the margin of safety a lot smaller, if it were the original company with all the original assets I would feel better owning it.


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## Value Collector (13 October 2016)

nioka said:


> . The float is there for the Ingham family to realise a return on 50 plus years of nurturing a business.




Nope, the Ingham family sold out in 2013, as I mentioned in the post above, this is a private equity deal, what is being sold here is an operating business that's be stripped of most of its hard assets and saddled with debt.

It's now an operating business that leases its facilities from the land lord.

I am still looking into it, it may still be a viable business model, but as I said above I would have rather bought it from Bob directly.


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## luutzu (18 October 2016)

Value Collector said:


> Nope, the Ingham family sold out in 2013, as I mentioned in the post above, this is a private equity deal, what is being sold here is an operating business that's be stripped of most of its hard assets and saddled with debt.
> 
> It's now an operating business that leases its facilities from the land lord.
> 
> I am still looking into it, it may still be a viable business model, but as I said above I would have rather bought it from Bob directly.




Best to avoid things financial engineers have gone through, stripped assets off and replaced it with debt.

I might look into this after I'm done with PEP and Asaleo. So far though, it's the same game plan as Anchorage and PEP.


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## Craton (18 October 2016)

Ah, private equity, such a dirty term. Reminds of the lyrics, "...money for nuthing an' your cheques for free."



> Ok guys, so I think I may have found the reason behind the missing equity, and it's the magic of private equity. <snip />




Thanks for the insight VC.


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## Value Collector (18 October 2016)

luutzu said:


> Best to avoid things financial engineers have gone through, stripped assets off and replaced it with debt.




I don't doubt that the company will generate cash, and if their management are good the company should be able pay a dividend and over time pay down debt and re establish a solid capital base, but yeah, its much less exciting than if they still owned all their restate and had low debt, and there is more scope for things to go wrong under the wrong management now.







Craton said:


> Ah, private equity, such a dirty term. Reminds of the lyrics, "...money for nuthing an' your cheques for free."




Yeah, the equity goes private and the debt goes public, lol



> Thanks for the insight VC.




Cheers


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## luutzu (18 October 2016)

Value Collector said:


> I don't doubt that the company will generate cash, and if their management are good the company should be able pay a dividend and over time pay down debt and re establish a solid capital base, but yeah, its much less exciting than if they still owned all their restate and had low debt, and there is more scope for things to go wrong under the wrong management now.
> 
> 
> 
> ...




What does your Spidey sense tells you?

Mine tells me that Australian investors and super funds are about to have a billion more dollars of theirs looted in this one.

Somebody better put an end to this nonsense before the already struggling Australians have diddly from their professionally managed super funds to retire on.

btw, are there any other reports beside the Prospectus?


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## Value Collector (18 October 2016)

luutzu said:


> What does your Spidey sense tells you?




As I said if it is run well, it will do ok. I think the brand and the operating system and network they have is worth something, unfortunately they just don't own the land and buildings it sits on any more.

it would be like Disney selling the land under their theme parks, hotels and studios and renting it back on a 7% yield, sure they would still make money, and return on equity would probably rise, but their competitive position and safety would be significantly reduced, imagine when that lease is up, and another themepark operator (or steggles) bids for the new lease.


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## Ves (18 October 2016)

Value Collector said:


> As I said if it is run well, it will do ok. I think the brand and the operating system and network they have is worth something, *unfortunately they just don't own the land and buildings it sits on any more.*




What happens, if at the end of the lease term,  the owner of the land/building gets a better offer from Steggles or some other competitor?


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## luutzu (18 October 2016)

Ves said:


> What happens, if at the end of the lease term,  the owner of the land/building gets a better offer from Steggles or some other competitor?




As my Dad would say, if they hold the handle while you the blade; then when they move you either follow or you bleed.


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## Value Collector (19 October 2016)

Ves said:


> What happens, if at the end of the lease term,  the owner of the land/building gets a better offer from Steggles or some other competitor?




I am not sure, I haven't seen the leases, but unless their is some sort of option to renew or option to purchase built into it I guess the new lease on certain strategic properties could have a bit of competitive bidding for it, Hell if I was the competition I might bid for the new lease just to increase my competitions rent


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## Ves (19 October 2016)

Value Collector said:


> I am not sure, I haven't seen the leases, but unless their is some sort of option to renew or option to purchase built into it I guess the new lease on certain strategic properties could have a bit of competitive bidding for it, Hell if I was the competition I might bid for the new lease just to increase my competitions rent



I might also pay a fair bit overs so they have to move elsewhere.

What if they have to move? Can they maintain production?   I'm sure these kinds of processing facilities aren't exactly easy to find and there would be a lag time in getting up and running again,   surely it'd be very crippling on an already indebted balance sheet (assuming it stays leveraged) if they have to cease some or all production whilst they move? 

Wonder what the contingency plan is?


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## craft (19 October 2016)

Value Collector said:


> I am not sure, I haven't seen the leases, but unless their is some sort of option to renew or option to purchase built into it I guess the new lease on certain strategic properties could have a bit of competitive bidding for it, Hell if I was the competition I might bid for the new lease just to increase my competitions rent






> Ingham’s owns the majority of its operating plant and equipment, while its land and buildings are managed either through leasehold or freehold arrangements. Ingham’s operates 79 leasehold properties, the majority of which are secured with 20 year terms with options to extend (five further terms, with each term for 10 years).




Took less time to search lease in the prospectus than to write this post.


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## Value Collector (19 October 2016)

craft said:


> Took less time to search lease in the prospectus than to write this post.


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## andy777 (20 October 2016)

This is a bit of an extract of something I posted a couple of months ago...... I am still peeved about those chicken tenders!

Extract:

Tonight when I went to cook my Inghams chicken tender I discovered that they had changed into that mushy chicken nugget centre instead of crumbed chicken breast fillet as they were a few weeks ago.  This got me thinking, wasn’t Inghams to be floated?  Upon further investigation I discovered that Inghams which had been a family run business for almost 100 years and was sold to TPG in 2013 for 880M.  After selling most of their hard assets for 650M and loading the balance sheet with debt (620M - depending on which report) TPG should come away with a tidy profit.  It is slated to list in September/October this year for 1.3B plus according to The Australian.

These are my calculations for TPG’s profit assuming a 1.5B listing price and assuming TPG is able to sell down their remaining shares near the list price:
Profit = list price + asset sales – (equity to purchase)
Profit = 1500M + 650M – (880M-620M)
Profit = 1890M
Not bad for an initial investment of 260M, which gives a return of over 7000% in 3 years for their efforts.

Assuming a listing price of 1500M, 620M in debt and EBITDA of 225M* (The Australian) the EV/EBITDA of Inghams post float will be 10.  My question is simple – Why would you buy the Inghams float?  After my experience tonight I feel that 225M will be over earning as they have lowered quality and customers will catch on and stop purchasing their product.

* I notice now they are saying and EBITDA of 190M or so.

This looks so much like spotless to me.  Maybe better than Dick Smith though?


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## andy777 (20 October 2016)

Forgot to add 550M paid out in dividends as well to private equity group owners


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## luutzu (20 October 2016)

andy777 said:


> This is a bit of an extract of something I posted a couple of months ago...... I am still peeved about those chicken tenders!
> 
> Extract:
> 
> ...




So glad to see that there are people who think like you Andy.


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## craft (21 October 2016)

andy777 said:


> This is a bit of an extract of something I posted a couple of months ago...... I am still peeved about those chicken tenders!
> 
> Extract:
> 
> ...






andy777 said:


> Forgot to add 550M paid out in dividends as well to private equity group owners




Hi Andy

One thing that struck me was your inclusion of the 650M from selling the properties in your calculation.  I would have thought the business sells the properties and maybe makes a capital return to the equity holders would be the process - not TPG pocket the funds directly.  So I opened the prospectus for a second time - (which by the way is once too much)

These are the only transactions with owners I can see.

Paid $308.4 million for it would seem approx. 328 Million shares currently outstanding - the remainder of the rumoured 880M purchase price must have been debt funded and looking at the quantum of debt on the books that sounds about right.

Received back a capital return of $200.5M and dividends of $314.6.

IPO target range is $3.57 to $4.14. They are not selling all their shares at IPO but assuming they could, at each price level the current owners shares are worth between 1171M and 1358M

Certainly a nice payday for TPG if the IPO is a success (not 7000% maybe 550-600%) but does their profit matter?  Your other points about quality and stacking EBITDA seem much more relevant.

disclaimer:

I have no interest in applying for shares at IPO.


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## craft (21 October 2016)

Craton said:


> Ah, private equity, such a dirty term. Reminds of the lyrics, "...money for nuthing an' your cheques for free."





I always thought the lyrics were ".... and your chicks for free"

Never contemplated they meant theses type though.


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## andy777 (21 October 2016)

craft said:


> Hi Andy
> 
> One thing that struck me was your inclusion of the 650M from selling the properties in your calculation.  I would have thought the business sells the properties and maybe makes a capital return to the equity holders would be the process - not TPG pocket the funds directly.  So I opened the prospectus for a second time - (which by the way is once too much)
> 
> ...




Whoops thanks craft, that was dumb of me to put an extra 0, I meant a 700% (i.e. 7 times initial outlay) profit.  All of these figures I got from good old fairfax as no prospectus was issued at that time.  Property figures and listing figures both obtained from fairfax articles a few months back - i.e. fairfax was suggesting a possible 1.5B listing and it seems this has been brought back.  Still, looks dangerous to me as well!  But what an interesting case study.


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## peter2 (21 October 2016)

If the potential rewards are not high enough for the initial risk as most posters have agreed on, how do the insto's justify their purchase? Who buys overpriced, asset poor, debt laden companies? Is it the same ones who bought DSE? 

PE deserves to be stuck with it, so why aren't they?


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## andy777 (21 October 2016)

peter2 said:


> If the potential rewards are not high enough for the initial risk as most posters have agreed on, how do the insto's justify their purchase? Who buys overpriced, asset poor, debt laden companies? Is it the same ones who bought DSE?
> 
> PE deserves to be stuck with it, so why aren't they?




Hi Peter,

It is a good question.  My understanding is that an index tracking fund will often be required to buy constituents of that index on a proportional basis.  Perhaps this could explain it?


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## Miner (21 October 2016)

in short I will continue to buy Ingham Chicken though preference towards Mt Barker organic one (NOT Woolworth imitation with Macro label).
I read a very interesting posting about Bob in this thread as well as in newspaper.
I can buy chicken for another 6 months than putting minimum application money on ING. Strongly No from me. DYOR.
PS: However after listing the share on ASX   I will look for an opportunity until it goes north by at least 30% from the listed price.


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## galumay (21 October 2016)

I am confused, miner, are you buying some shares, some chook, or both??!!

(I buy a bit of chook, but not these shares!)


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## So_Cynical (21 October 2016)

AustSuper have pre committed to 150m of the float.

http://www.afr.com/street-talk/australiansuper-tucks-into-inghams-20161011-gs06dv


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## Miner (21 October 2016)

galumay said:


> I am confused, miner, are you buying some shares, some chook, or both??!!
> 
> (I buy a bit of chook, but not these shares!)




galumay
You made me laugh.
I thought my message was clear that I will  buy CHOOKS first. That too from Mt Barker Organic chooks.
I will not buy ING even Australian SUper committed $150 M (they are playing with others money and I do have some fund there ). 
I will buy ING when the price drops down by 30% or so after IPO .
If you are reading outside pub  my intention is clear as water.


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## greggles (7 June 2018)

Ingham Group's Chief Executive Officer Mick McMahon is leaving the company, stepping down from the role after the company's annual results in August 2018. The company stated that a domestic and international executive search process has commenced and it is expected there will be internal candidates for the role.

The market must have been hoping that Mick would stay as the ING share price plunged after the announcement and is currently trading at $3.755, down 8.19% from yesterday's close.


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## MARKETWINNER (18 April 2019)

Neglected and It is looking stable. Australia is the third-highest consumer of chicken in the world per capita.


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## Value Collector (18 April 2019)

Researching Ingam’s and the NYSE listed Tyson foods played a large part in me becoming vegan, the more I researched and learned about modern animal agriculture the more a realized it was immoral.

I decided I couldn’t invest in either company from a moral stand point, but it took another year before I Realized that if I couldn’t bring my self to profit on the back of suffering, I shouldn’t be paying for it either, so I stopped eating meat.

So far so good,

Vegan schnitzel Parma is just as good.


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## Ann (19 April 2019)

It has recovered since it's dive after the ING FY2019 Results Announcement back in February this year. It seemed fine to me but I am not great with FA.
Anyway it is doing a buy back, so that may be supporting its price to some degree. There are no higher price levels before this chart period. So it is in its all high time period.


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## Ann (20 April 2019)

Looking at an EquiVolume chart it appears there is a very, solid support level at $4.30. Should it fall below $4.10, it might battle to get back up for some time with the volume of selling pressure.


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## aus_trader (20 April 2019)

Ann said:


> Looking at an EquiVolume chart it appears there is a very, solid support level at $4.30. Should it fall below $4.10, it might battle to get back up for some time with the volume of selling pressure.
> 
> View attachment 93966




The price has stabilised since the huge down day when the CEO exited on the 28th of Feb. So I think there is still demand for this stock based on fundamentals and a strong history of the brand in the AU/NZ presence.

The stock was listed only two years ago but the brand is known for decades and has a good foot-hold in Australia and New Zealand:





It is also a steady dividend payer, currently paying out with and annual yield of 4.5% fully franked.


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## aus_trader (3 May 2019)

Just had a look at the ING chart from a longer term view since the listing and it looks like it's in a clear up trend despite all the volatility. Given that it is a steady dividend payer (see below) offering a good dividend yield as well, I've put it on my watchlist of stocks.







So far looking good, capital growth + income as far as the chart is concerned, just excuse the Ad covering some earlier dividends.


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## Value Collector (3 May 2019)

aus_trader said:


> Just had a look at the ING chart from a longer term view




Long term there looks like competition might be coming from some unlikely sources.

Plant based “meat” companies are growing super fast, and lab grown meats are coming onto the scene.

It’s hard to imagine factory farming chickens being a growth business 5 or 10 years from now.

Check out the this video, the market is backing beyond meat.


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## aus_trader (3 May 2019)

Value Collector said:


> It’s hard to imagine factory farming chickens being a growth business 5 or 10 years from now.
> 
> Check out the this video, the market is backing beyond meat.




Thanks for bringing this up, it's always good to know the latest trends and this looks like quite an innovative / disruptive trend is taking place.

ING may be safe for now as the video mentioned they are primarily targeting beef and pork industries and not poultry.


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## Value Collector (4 May 2019)

aus_trader said:


> ING may be safe for now as the video mentioned they are primarily targeting beef and pork industries and not poultry.




No, they are making chicken product too, I actually have had a plant based “chicken” schnitzels, a few different companies are making them.

Tyson foods is the largest chicken producer in the USA, and they have bought shares in beyond meat, and also released a separate plant based meat alternative them selves, their CEO has mentioned in public interviews he believes plant based is the future long term.

Check out this review of beyonds plant based chicken, the vegan girl actually said she didn’t like it because it tasted to much like real meat, which is what a lot of people moving away from real meat want


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## aus_trader (4 May 2019)

Value Collector said:


> No, they are making chicken product too, I actually have had a plant based “chicken” schnitzels, a few different companies are making them.
> 
> Tyson foods is the largest chicken producer in the USA, and they have bought shares in beyond meat, and also released a separate plant based meat alternative them selves, their CEO has mentioned in public interviews he believes plant based is the future long term.
> 
> Check out this review of beyonds plant based chicken, the vegan girl actually said she didn’t like it because it tasted to much like real meat, which is what a lot of people moving away from real meat want




In the beyond (BYND) interview the CEO said the company was not into poultry at this stage. But interesting other companies are doing it. I think it's a good thing  If only there was an alternative to eggs


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## Value Collector (4 May 2019)

aus_trader said:


> In the beyond (BYND) interview the CEO said the company was not into poultry at this stage. But interesting other companies are doing it. I think it's a good thing  If only there was an alternative to eggs



That is beyond brand chicken in the video I linked, didn’t hear him say they are avoiding poultry, I will have to rewatch the video.

Edit- I rewatched it, he says that they are doing beef, pork and chicken, but investing most is beef and pork.

But yeah, they are definitely still expanding chicken alternatives.


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## aus_trader (4 May 2019)

Value Collector said:


> That is beyond brand chicken in the video I linked, didn’t hear him say they are avoiding poultry, I will have to rewatch the video.
> 
> Edit- I rewatched it, he says that they are doing beef, pork and chicken, but investing most is beef and pork.
> 
> But yeah, they are definitely still expanding chicken alternatives.



I see, I thought the vegan girl's video was from another company since it had a different logo than the current beyond Cow logo. Maybe the company had changed logo in the past.


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## So_Cynical (4 May 2019)

Beyond meat is beyond belief - fake meat is not the next big thing.


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## Value Collector (4 May 2019)

So_Cynical said:


> Beyond meat is beyond belief - fake meat is not the next big thing.




Have you checked out their sales growth?

Having traveled through the USA in the last two years it’s I have seen Beyond and their competition the impossible burger grow in popularity.

Even Disneyland is selling their patties on burgers, and the major burger chains are all introducing either be beyond or impossible.

If you have a grill’d burger shop near you, go and try the “beyond simply grilled burger”.


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## galumay (4 May 2019)

Value Collector said:


> Have you checked out their sales growth?




I dont doubt there will be some initial growth in a new product like this, but how sustainable is that growth? Its just a type of pattie, the margins will get squeezed as there is no barrier to entry and the % of the population who are vegan/vegetarian is still tiny. 

Regardless, once the hype is removed these businesses are just commodity food producers which has not historically been a particularly high margin sector nor has it generally had much enduring competitive advantage. 

On the other hand one can look at the craziness of milk companies performance in the share market and I guess that suggests anything is possible!


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## Ann (4 May 2019)

aus_trader said:


> Just had a look at the ING chart from a longer term view since the listing and it looks like it's in a clear up trend despite all the volatility. Given that it is a steady dividend payer (see below) offering a good dividend yield as well, I've put it on my watchlist of stocks.
> 
> View attachment 94342
> 
> ...



Nice chart! Does anyone see what appears to be a fully formed head and shoulders top?


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## Ann (4 May 2019)

In case people can't see the bearish Head and Shoulders pattern happening on ING here is another chart with the lines drawn....


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## Joe Blow (7 May 2019)

I have moved all posts relating to animal welfare out of this thread and into the Animal rights and ethical food production thread. Anyone who wants to continue that discussion can do so over there.

This thread is for the discussion of Inghams Group. The topic of artificial meat and the implications that has for ING is relevant to a degree so I have left some of that discussion in here.


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## aus_trader (8 May 2019)

Ann said:


> In case people can't see the bearish Head and Shoulders pattern happening on ING here is another chart with the lines drawn....
> 
> View attachment 94367



OK thanks for making that obvious. It's not the easiest pattern to see so I do admit not picking it up.

So that's the bearish case pointed out. I'm not going to short it but will be a bit more cautious buying it. What would cause the pattern to be invalid i.e. where does the price need to go in order to say "the H&S didn't play out"? What about a bullish scenario, what levels does price need to rise to?


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## aus_trader (17 May 2019)

ING stock gapping up today, I might buy it. If I do will post details later...


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## Trav. (17 December 2019)

My first short trade placed today, and ING is the lucky stock to receive that honour.

In at $3.47 so will be watching closely.


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## barney (17 December 2019)

aus_trader said:


> ING stock gapping up today, I might buy it. If I do will post details later...




Turned out to be a bit of a trap back in May … I assume you didn't go through with that Aus?



Trav. said:


> My first short trade placed today, and ING is the lucky stock to receive that honour. In at $3.47 so will be watching closely.




Purely chart based Trav or fundamental as well?  Nasty looking down bar today …. good luck with it.


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## Trav. (17 December 2019)

Well day one went well. Just gotta maintain that downward trend !!


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## Trav. (17 December 2019)

@barney cross post above. 

Entry purely chart based


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## barney (17 December 2019)

Trav. said:


> @barney cross post above.
> 
> Entry purely chart based




May the force be with you


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## aus_trader (17 December 2019)

barney said:


> Turned out to be a bit of a trap back in May … I assume you didn't go through with that Aus?




Unfortunately went ahead with the purchase. Fortunately got out before the big gap down in late August. Still a realised loss in my account as documented in my spec portfolio.


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## barney (17 December 2019)

aus_trader said:


> Unfortunately went ahead with the purchase. Fortunately got out before the big gap down in late August. Still a realised loss in my account as documented in my spec portfolio.




Thanks for that Aus. Missed the update on the Spec/P thread (so many threads!) ….. 

Glad you got out with most of your shirt intact


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## frugal.rock (17 December 2019)

Trav. said:


> My first short trade placed today, and ING is the lucky stock to receive that honour.
> 
> In at $3.47 so will be watching closely.



I used to know Sam and Julie Ingham in my earlier life.
Julie certainly blossomed from an average duckling to a beautiful swan. Couldn't stop staring at her one day when she turned up at the local after not seeing her in years. Absolutely stunning. She was returning my glances but I was young and dumb and gobsmacked.
Back to business...
Good luck with the short, are you out already?
Am also interested, what triggered you to do a short?
Am heading that way myself... shortly. Lol


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## Smurf1976 (17 December 2019)

Trav. said:


> @barney cross post above.
> 
> Entry purely chart based



Do you have a specific target to exit?

Or just when the trend stops etc?


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## Trav. (18 December 2019)

frugal.rock said:


> Am also interested, what triggered you to do a short?




I am flying out to work this morning and will post a chart in a few hours that will show my thoughts 



Smurf1976 said:


> Do you have a specific target to exit?
> 
> Or just when the trend stops etc?




No target on this one, so will watch until trend changes and pull back occurs. Trail stop is also on place.


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## Trav. (18 December 2019)

Why do a short?

I suppose the beauty of AmiBroker is that you can test systems at a click of the button and testing a short was just a natural extension of my development. While the market is up now it will not always be and by placing a few shorts will give me confidence in the system / cfd provider and myself. Currently the back test split is approx 60% long / 40% short.

Just a really quick / simple markup on my thoughts for entering this trade


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## aus_trader (18 December 2019)

Trav. said:


> Why do a short?
> 
> I suppose the beauty of AmiBroker is that you can test systems at a click of the button and testing a short was just a natural extension of my development. While the market is up now it will not always be and by placing a few shorts will give me confidence in the system / cfd provider and myself. Currently the back test split is approx 60% long / 40% short.
> 
> ...



Your thinking is good @Trav., interested in how you will develop your shorting skills.

In fact that is the way a lot of the hedge funds operate as well, slightly underperforming in bull markets but outperforming during bear markets by having a few short positions to hedge against their long portfolio.


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## frugal.rock (19 December 2019)

Trav. said:


> ...
> No target on this one, so will watch until trend changes and pull back occurs. Trail stop is also on place.



Thanks for the explanations and charts.
Am interested if you jumped off, and maybe on again?


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## Trav. (19 December 2019)

frugal.rock said:


> Am interested if you jumped off, and maybe on again?




Still holding mate. 

My back tested average hold time is approx 15 bars so not looking at day trading, unless it gaps unexpectedly and then I will tighten my stops pretty quick..


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## frugal.rock (20 December 2019)

Sounds like a plan.
So, forgive my ignorance, average hold time, 15 bars?
What does it all mean?
Am guessing not pub crawl speak...(15 bars.. definitely an all nighter depending on how many dud bars!) 
Just haven't heard of bars as a scale of reference for time?
Cheers


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## Trav. (20 December 2019)

I trade on daily charts so 1 bar is one trading day.

https://www.investopedia.com/terms/b/bar.asp


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