BOL - Boom Logistics

[TheAbyss]

I hold BOL and note that they have gone back 12% today on what appears to be a very good report. Anyone have an opinion they care to share?

 

[barney]

I hold BOL and note that they have gone back 12% today on what appears to be a very good report. Anyone have an opinion they care to share?

Hi Ab, Just about to mention BOL myself ......... Sometimes the market does what seems to be irrational things .......... I reckon its traders ...... Wouldnt surprise to see it back over $4 by end of trade today. Cheers, Barney

 

[TheAbyss]

The report states

Highlights
• NPAT up 25% to $19.6m
• EBITDA up 36% to $48.2m
• Interim dividend 5.7cps fully franked, up 10%
• Underlying organic growth rate 10%
• James Group integration progressing well

Downside is CEO retiring however hardly rates a 12% fall.

 

[TheAbyss]

Just picked up another 3000 units for what i hope is a quick and profitable trade. The CEO retiring bad news over reaction IMO

 

[TheAbyss]

A week ago this stock was at 4.10 and drifted up to 4.15. Then today up to 4.34 pre half yearly results then the results come out and they fall to 3.62.

Now making their way back up. Be keen to hear any other opinions

 

[Halba]

Abyss

Its not ceo retiring.

EPS over 10% below analysts expectations.

On my numbers, EPS growth was 5%, mkt wanted 15-20%.

That means it should be down 15% today.

 

[TheAbyss]

Thanks Halba.

 

[brendan87]

I am a holder of BOL and I also thought the reaction was a little overdone. Interesting considering the quite impressive run up and close yesterday. I don't think anything fundamentally has changed but the stock does have a history of counter-intuitive reactions to news (especially the stocks sensitivity to housing statistics...when today's report says residential construction is under 1% of earnings). It's a well diversified (geographically and product mix wise) - and over 2/3 of earnings are 'maintenance' services which are acyclical. I thought prices under $3.70 were too good to go past so picked up a few this morning. Coming back nicely this afternoon it seems.

 

[reece55]

Halba - Not sure if the decrease in EPS growth should equate to the same level of fall here....

Guys, I seriously would not be too worried here.... OK, the numbers weren't as good as people expected. This stock has heavy backing from instos and is a great stock - this will be seen as a minor blip on the way. Support today of 3.60 was tested and has come up very strong - wouldn't be surprised if the inso's are topping up today on the high volume!

Cheers

 

[barney]

Halba - Not sure if the decrease in EPS growth should equate to the same level of fall here....

Guys, I seriously would not be too worried here.... OK, the numbers weren't as good as people expected. This stock has heavy backing from instos and is a great stock - this will be seen as a minor blip on the way. Support today of 3.60 was tested and has come up very strong - wouldn't be surprised if the inso's are topping up today on the high volume!

Cheers

Agreed Reece, The Instos probably started the landslide in the first place .... so they could top up at good prices when a lot of stops get hit ...... now its bounced back, they will probably play "yo-yo" with it for a day or so.

 

[Halba]

Hi Reece - in my fall I accounted for markets being a little bit 'pissed' off, by shaving another couple of % below what it should be.

Unfortunately there's not much upside on my numbers apart from the dividend?


If you want a divvie just buy CBA, they have declared $1.08 dividend.

 

[Jimminy]

I think you'll find if you look closely that the reason is that the divvie has only been increased by 10% ......this has pissed the market off...

Given the NPAT increase this is piddly.

 

[mmmmining]

There is disconnection between mining giant BHP, RIO, construction giant LEI, and the equipment hiring company.

Rising SP of BHP and to the extraordinary performance of LEI is based on the expanded mining and construction activities.

The beaten down SP of BOL, and to the less extended, also with less expectation of NHR does not make any sense because they are directly and fully involved in this boom. Or does it generate a great opportunity for investment, not trading?

Soon or late BOL and NHR, include COA's business should be back to high gear if they don't kill each by competition.

I think the current dip is a great buying opportunity. Just have a look at LEI and BHP's SP 3 months back, anyone want them? I guess this group of stocks might be 3-6 months lag behind....

 

[brendan87]

Just commenting on the 10% increase in DPS - I think it reflects the board's confidence that they can grow the business, particularly through more acquisitions. Remember that EPS is either distributed as div's or ploughed back into the business as retained earnings. I try to keep in mind that companies announcing large capital management/special div's (as great as they are ) are effectively saying to shareholders "your better off with the cash dividends than trying to reinvest profits in the business" - or in the case of capital initiaves (eg. BHP last week), the business is unable to grow earnings per share enough through its operations so reducing the capital base through buy-backs is the only way to drive EPS growth. For investors looking for growth - a lower payout is a positive signal and I think markets tend to focus on the short-term bonuses coming out of record company profits rather than what the board is really saying about the company.

 

[michael_selway]

Abyss

Its not ceo retiring.

EPS over 10% below analysts expectations.

On my numbers, EPS growth was 5%, mkt wanted 15-20%.

That means it should be down 15% today.

EPS(c) PE Growth
Year Ending 30-06-07 27.6 15.1 26.7%
Year Ending 30-06-08 30.5 13.7 10.5%

Earnings and Dividends Forecast (cents per share)
2006 2007 2008 2009
EPS 21.8 27.6 30.5 33.4
DPS 10.4 13.0 15.0 16.2

thx

MS

 

[TheAbyss]

Bol appears to be bouncing back. Back to $4.00 from the ridiculous $3.62 yesterday.

On my calculations you could pick them up now for $4.00 and keep them for the div alone and make 11% (Using a Margin loan valuation of 60%) and allowing for a hold of 45 days. Your consideration would be whether to follow Rosella's lead (see dividends thread) and decide whether to sell as the SP increases towards Ex div date (TBA but pre 23 March as that is the payment date) or retain for the div and sell post div.

 

[Ken]

BOL, and COA are both following a similar trend. Both have recently payed a dividend, and both have dropped close to 20% since February.

I find this very interesting seeing as it deals mainly in the construction and mining sector. Unemployment levels are still low which would indicate there is plenty of work being done. Infrastructure has not suddenly stopped and building companies such Leighton holdings are at all time highs.

BOL looks oversold to me considering it's forward looking dividend and earnings per share, I am just wondering if others feel the same way.
The director has sold over $400k of his shares, but he still owns a substantial amount, in the millions.

I have also noticed Insto's such as CBA, AMP, WBC, becoming and ceasing to be substantial holders over the past month. Whether this is a swing in there port folios I am unsure.

On the other hand prices of $4.50 for BOL could have been overbought,and it is now coming back to true value.

Any thoughts... COA, and BOL both struggling. That big drop not long ago could be the start of a downward trend.

Thoughts??

 

[Jimminy]

Ken,

I sold out of BOL shortly after their report cam out....but read their half yearly report / presentation for yourself. You will understand why the sp has droppped. Prospects for this company are neutral for the next 6-12 months, hence the selling.

 

[Ken]

Looking at the chart support appears to around current levels. However a lack of announcements may see price edge lower.

The lower the price goes, the rise in the increased dividend percentage will look more attractive to investors.... currently dividend is at 3.6% and a fall to $3.00 a share would be 4.6%.... for a growth stock with secure earnings that would seem a little high....

Just trying to pick a bottom for BOL.

 

[barney]

Looking at the chart support appears to around current levels. However a lack of announcements may see price edge lower.

The lower the price goes, the rise in the increased dividend percentage will look more attractive to investors.... currently dividend is at 3.6% and a fall to $3.00 a share would be 4.6%.... for a growth stock with secure earnings that would seem a little high....

Just trying to pick a bottom for BOL.

Howdy Ken, Just my guess on BOL, but I suspect that the bulk of the selling has now been completed .......... the two big banks have bought and sold their respective positions ......... In saying that, it would not surprise to see the sp drift a little lower yet as the last of the sellers come in, but if it holds and consolidates above $3.51 I think it looks a solid longer term investment ........... I do hold a few so I'm probably biased Cheers.