AIO - Asciano Limited

[Nicks]

Hi All

Just thought i'd kick this one off so it has its own legs since the TOL split.

What does everyone think about this one? Im fairly confident with it and will hold onto the shares since the split. Seems to have picked up many of the excellent industry competetive positions from the split. Will wait with keeness to see what sort of dividend we get and growth strategies that Rowsthorn will pursue.

 

[nikkothescorpio]

Re: AIO - Asciano

Seems to have a very good market position - all but a monopoly - seems a very solid bet considering the general sentiments for major infracture/transport growth well into the future.

Seems to be crawling back AUG losses but had a downward trend well established prior to this.

Would welcome anyone elses thoughts too.

 

[blaze87]

Re: AIO - Asciano

any1 here knows why Asciano wants to gobble up BRAMBLES LIMITED
BRAMBLES LIMITED is 4 times bigger than Asciano, and from my limited knowledge, it usually does not bode well when a smaller companies want to take over a bigger 1

 

[Ken]

Re: AIO - Asciano

This is just a Toll/Patricks related get a monopoly on the market type play.

AIO stake in Brambles is debt funded. So they are paying interest on there 4.1 percent stake on Brambles.

They picked it up well below the price of Brambles is now.

So they have effectively made a massive profit on paper. Yet AIO share price has been punished.

If AIO is to sell there stakein Brambles, as a AIO shareholder, I would be very happy. As they have effectively made a good 30 % on there investmentment.

AIO share price has been battered due to people not beleiving the takeover is going to occur.

AIO is going to struggle to get the finance I have heard, as they are already to the tilt carrying all of TOLL holdings debt which was spun out in this new company.

AIO may just be a decoy for TOLL to slide into taking over Brambles.

Who knows. But brambles is differently a possible takeover target.

Why would AIO want Brambles? No idea, I did read that if AIO took over Brambles it would be running at a loss, but it would be take effective for the company.

From a far, it appears AIO has too much debt to take on already though.


anyone have 100 % accurate truth, i am stll putting pieces together

 

[BHP]

Re: AIO - Asciano

Hi All,

I am fairly new to shares but have learned alot from this great forum.

I have been reading some of the threads regarding volume and taking a stab at this one I think this stock may be ready to turn around.

It has support around $8 from mid August lows.

Volume has increased over the last 10 trading days, mainly down however the last 4 days seem a little different.

28/10 - it stopped its slide, got under $8 and finished above on high volume.

29/10 - closed near the open on average volume.

30/10 - closed on the bottom on average volume.

31/10 - went up all day and closed on the high on above average volume.

Perhaps all the sellers are done and now mainly buyers left? Will watch with interest tomorrow but if the run up continues I may jump in around $8.45.

Any comments from those who understand Volume appreciated ( or anyone at all ).

 

[shinobi346]

Re: AIO - Asciano

From what Ive been reading I've always felt it is TOL that is the one more interested in aquiring BXB.

From their last AGM, Little reiterated "Toll remains very interested in the significant value creation and optimisation strategy generated by integrating pallets into the supply chain"

They already have a pallet business in china so I can see them merging the number 1 in it in the world together and integrating it into their logistics business.


But who knows for sure whos going to act first - if anyone is.

Before TOL and AIO bought a stake in BXB the sp kept sliding so it works for me...

 

[Jack_Junior]

Re: AIO - Asciano

This is just a Toll/Patricks related get a monopoly on the market type play.

AIO stake in Brambles is debt funded. So they are paying interest on there 4.1 percent stake on Brambles.

They picked it up well below the price of Brambles is now.

So they have effectively made a massive profit on paper. Yet AIO share price has been punished.

If AIO is to sell there stakein Brambles, as a AIO shareholder, I would be very happy. As they have effectively made a good 30 % on there investmentment.

AIO share price has been battered due to people not beleiving the takeover is going to occur.

AIO is going to struggle to get the finance I have heard, as they are already to the tilt carrying all of TOLL holdings debt which was spun out in this new company.

AIO may just be a decoy for TOLL to slide into taking over Brambles.

Who knows. But brambles is differently a possible takeover target.

Why would AIO want Brambles? No idea, I did read that if AIO took over Brambles it would be running at a loss, but it would be take effective for the company.

From a far, it appears AIO has too much debt to take on already though.


anyone have 100 % accurate truth, i am stll putting pieces together

Howdy all,
I work for Asciano and am led to believe that as a Toll spinoff, Asciano actually aquired Patricks debt free (all debt going to Toll).
Toll is definitely the one more interested in a "friendly takeover" of BXB but at the end of the day Paul Little has advised that he "would much prefer a friendly takeover rather than things turning nasty" (as the Patrick takeover did)

A long term stock for you all to look at rather than this group could be KIL.
Chris Corrigon is now on the board (as is Maurice James and many more of the ex Patricks hierachy) there and they own a company called P&O Transport. Not too long ago they aquired an Asian company as a stepping stone into the Asian market and have also been mentioned in talks of buying into / taking over Queensland Rail.

May pay for you to read up on them - KIL


Hope this helps

 

[Ferret]

Re: AIO - Asciano

AIO has taken a real caning since listing. Starting to look very interesting at current prices. Anyone else think this might be oversold?

Ferret

 

[BHP]

Re: AIO - Asciano

Yeah, I think it's oversold. Bought some yesterday, may buy some more in the coming days.

It's a company that operates in an area with high barriers to entry.
It has few competitiors so can easily pass on rising fuel/labour costs to it's customers.
All the miners are ramping up production so business should increase.
Ports are getting busier both import and export.
CEO Mark Rowsthorn owns over 9% of the stock, so his goals are aligned with mine, for the long term.

Has it hit bottom? who knows. It's a long term investment for me though so i don't really care if it drops more from here in the short term.

Bought some a month ago but got stopped out at cost. This time I am not leaving a stop on it, I plan to hold for many years.

 

[michael_selway]

Re: AIO - Asciano

Earnings and Dividends Forecast (cents per share)
2006 2007 2008 2009
EPS 0.0 6.3 15.3 22.6
DPS 0.0 0.0 46.0 50.5

It has nice growth but a bit expensive

thx

MS

 

[Ferret]

Re: AIO - Asciano

Still trending down. I'm watching for this to reverse, then I will probably get onboard.

They are having an investor briefing on 11 Dec. Will talk about their intentions for the Brambles holding and the funding costs. Could be good news or bad. Any leakage of the news might show in the price leading up to this.

 

[BHP]

Re: AIO - Asciano

A bit early to say but seems to have bounced. Currently going back up on reasonable volume. See how it closes today.

 

[Ken]

Re: AIO - Asciano

At $7.11 how do we analyse AIO?

Maybe overpriced from the beginning and coming back to some value.

Its definitely in a down trend, is there a lot of conjecture over the ports with labour coming into government? Not sure??

But AIO does seem to have taken an absolute battering.

 

[Muschu]

Re: AIO - Asciano

Any comments, please, on today's performance? AIO has dropped about 5% as at 1pm -- significantly more than the market downturn and without any significant announcement. Thanks

 

[Tristo]

Re: AIO - Asciano

Certainly taking a battering, and on no news. I can't seem to understand it either. It's been the perfect stock to short it seems.

 

[wildmanchris]

Re: AIO - Asciano

For the last three months this share has dropped more than the ASX if it has a down day, and has continued to trend down with only BRIEF signs that it has made a bounce but no luck on any of those attempts.

I work with a guy that has a huge paper loss on this one by believing that the fundamentals are strong and will help it recover. The market doesnt seem to have faith in their high debt levels.

 

[Muschu]

Re: AIO - Asciano

Thanks.
Looks like it's been on a steady decline from over $11.50 6 months ago to as low as $5.24 -- and it's only 30c above that now.
Curious. I gues it can keep going down and down and......

 

[wildmanchris]

Re: AIO - Asciano

Who knows where this one will go - it dosent show any signs of stemming the flow.

Good luck to all who continue to hold.

 

[chilliaa]

Re: AIO - Asciano

In my opinion you may find that so called 'safe' infrastructure investments turn out to the be 'internet' bubble of this decade.
Just because a company opperates assets with a semi monopoly doesnt mean that the company is 'safe' or that its shares can be purchased at any price.

With AIO i think its debt levels may well come to haunt them in the years to come, that and its insistence of paying out high dividends. During relaxed credit markets with low IR this may have been a possibility, but those times are over.

I know i my opinion is very much against the views of most analysts. But consider the following issues:

Whilst in the short term (next couple of years) AIO does not have significant debt financing obligations and its interest rate expense is reasonably hedged, what happens afterwards??????
This is an infrastructure play based on a calculation of present value over the next 20yrs+.
If long term interest rates are on a cyclical upturn (the reverse of the 1980's to now), this company is going to get decimated. Current EBITDA interest cover is only 2.2x, if FUTURE interest rates increase after the expiration of current interest rate hedges, look to see MASSIVE revisions of 'fair value' based on discounted cash flow analysis.

Sorry guys but this is another stock i am avoiding, at least until its share price drops so that i get a margin of safety to compensate me for this risk.

 

[blaze87]

Re: AIO - Asciano

In my opinion you may find that so called 'safe' infrastructure investments turn out to the be 'internet' bubble of this decade.
Just because a company opperates assets with a semi monopoly doesnt mean that the company is 'safe' or that its shares can be purchased at any price.

With AIO i think its debt levels may well come to haunt them in the years to come, that and its insistence of paying out high dividends. During relaxed credit markets with low IR this may have been a possibility, but those times are over.

I know i my opinion is very much against the views of most analysts. But consider the following issues:

Whilst in the short term (next couple of years) AIO does not have significant debt financing obligations and its interest rate expense is reasonably hedged, what happens afterwards??????
This is an infrastructure play based on a calculation of present value over the next 20yrs+.
If long term interest rates are on a cyclical upturn (the reverse of the 1980's to now), this company is going to get decimated. Current EBITDA interest cover is only 2.2x, if FUTURE interest rates increase after the expiration of current interest rate hedges, look to see MASSIVE revisions of 'fair value' based on discounted cash flow analysis.

Sorry guys but this is another stock i am avoiding, at least until its share price drops so that i get a margin of safety to compensate me for this risk.

hey chillia, interesting post there. so u assume that interest rates in the future will be higher than what it is going to be now?
i know it's useless trying to guess interest rates, but what is the factor behind the reason for continued increased interest rates?

personally i think interest rates might rise this year and maybe next year, from then afters it decrease to a more reasonable value of maybe 3-6%