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AOG - AVEO Group

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Re: FKP - FKP Property Group

So_Cynical said:
Ill second that. just would of been better for me if i had waited a bit for my first parcel...and gone again at the bottom.
Click to expand...

Once it turned, it turned with a vengances that's for sure. Up over 40% in the last few weeks, why is it i pass on the ones like this and then end up buying the ones who go nowhere
 
Re: FKP - FKP Property Group

prawn_86 said:
Once it turned, it turned with a vengances that's for sure. Up over 40% in the last few weeks, why is it i pass on the ones like this and then end up buying the ones who go nowhere
Click to expand...

Don't beat yourself up over it. The rise looks fantastic, but if you analise it, the daily volumes were very thin. The run up was made up of retail buying through small numbers of sellers. Each days daily turnover was relatively low when compared with the volumes changing hands when the share price dropped. A dirth of sellers and moderate numbers of desperate buyers. You'd think there was a takeover offer in the making but if you looked at the break up of the major shareholders, you would realise how unlikely this event would be.

Irrational exuberance, gap filling of an oversold share...who nows? If you hold, be happy. If you missed the entry, don't worry about it as there will be other opportunities. Personaly I wouldn't be surprised if there was a modest retrace. It is still unclear what they intend to do about the June div. At least now it is trading above the capital raising level of $1.40 (7 x $0.20).

 
Re: FKP - FKP Property Group

Just an update. Today FKP hit a new low of $1.05, when most other A-REIT's consolidated or went up.



Hard to believe that six years ago this share was worth the equivalent of $27+

 
Re: FKP - FKP Property Group

The market seems to be warming to the new management and strategy. The share price has rallied strongly this month, so far. It even looks to be breaking out side ways from the downward spiral.



Fingers crossed that they can work on increasing the level of returns and closing the gap between the share price and the NTA.
 
Re: FKP - FKP Property Group

FKP has done well for the last two days running. Seems SGP has seen fit to reduce their level of FKP holding and the market likes this. Still got a long way to go to get anywhere near the NTA value.
 
Re: FKP - FKP Property Group

I'm totally out today at $1.87 ~ i have seen FKP retrace so many times now i just had to sell out, as a bonus im 4 days over holding 12 months so get the CGT discount (Superfunds get the discount?)...as a negative my Superfund has suffered its first losing trade, my first FKP parcel.

Results below.
~
 

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Re: FKP - FKP Property Group


Yeah super funds get the discount however it operates a little differently. The normal 15% tax rate is lowered to 10% for gains over 12 months...
 
On December 10th, 2013, FKP Property Group changed its name and ASX code to AVEO Group (AOG).
 
Is Aveo worth shorting ?

Aveo is certainly in the news at the moment. Since the name change they have created a new direction for the company and focused on maximising the returns on their historic and developing Retirement Village complexes. In particular they have developed the "Aveo Way" . This seems to be streamlined mechanism to simplify the contracts with Retirement Village occupants.

Ultimately The "Aveo way" is very commercially focused on the interests on Aveo. This is made clear in the financial reports they made earlier this year which highlight the sharp increase in profits they anticipate from rolling out this strategy.

Unfortunately the process of extracting these significantly higher profits from the current and ex residents of the Villages has created some really big waves that could result in blowback to management, the company and perhaps the entire industry. The Fairfax Press has been running a series of articles in the past few days highlighting the practices of the company and 4 Corners will pull the story together this evening.

The consequences for the SP in the short term seems fragile and if The Aveo Way practices are seen as just too one sided the projections made in Feb 17 could go down the toilet.

https://www.aveo.com.au/wp-content/...15-AOG-HY17-Financial-Results-Presenation.pdf
http://www.abc.net.au/news/2017-06-24/elderly-exploited-in-aveo-retirement-villages/8645876
 
No surprises on the share market. 8% fall as nervous investors jump out.

It will be interesting to see if AOG sue 4 Corners over tonights program. The title itself is challenging

Watch 'Bleeding Them Dry Until They Die' on Four Corners at 8:30pm on ABC TV on Monday night.
 
An abundance of caution would be my suggestion.

1. we saw with Estia & the like what can happen when you over-earn on the back of the aged.
2. The financials appear average - 1H17 accounts, operating cash-flow fell from substantially to $150m. Compare this to the p&l, where a profit was booked on the back of asset revals.
3. Retirement villages always suffer with cash conversion due to the DML model. To fill the cash gap, they try to churn through units & add new units where they can earn development profits. But this is a highly cyclical revenue stream.

However, at least the debt is not as high as the FKP days and there is no housing or asset mgt.
 
The 4 Corners program was very disturbing. I think there is a real risk of an strong independent inquiry into the Aveos practices and the industry as a whole. The proposal to collapse the exit fee (35-40% of sale price) to three years creates a moral hazard of immense proportions.

The story to date indicates the company is quite committed to using churn tactics to maintain it's expected profit levels. I think an independent inquiry would find this unconscionable. I believe there will be more coming out of the current investigations and I think the publicity generated by the program will pull out many more disgruntled present and past residents. One law firm has indicated they are prepared to run a class action on behalf of residents if asked.

SP is still falling.
http://levittrobinson.com/victorian-parliaments-missed-opportunity-on-retirement-housing-sector/
http://www.canberratimes.com.au/interactive/2017/retirement-racket/bleed-them-dry/
 
There might be an ASX investigation into the Aveo share buyback. The share buyback which essentially has supported the SP which is under pressure because of the current intense investigations of it's financial and operational practices.

Turns out as the market took big hits because of the 4 Corners/Age investigation the big buyers were associated with AOG - before the public announcement of the buyback.

'A raised eyebrow': calls for probe into Aveo share trading
The corporate watchdog has been called on to investigate recent trading of Aveo’s shares ahead of the company announcing a $145 million buy back this week.

Investment specialists have called on the corporate watchdog to investigate recent trading of Aveo's shares by its largest shareholder Mulpha and a director ahead of the company's announcement of a $145 million buyback this week.

The buyback of 9.3 per cent of the company's shares was launched on Tuesday after emergency weekend board discussions triggered by the publication of the first articles in a joint Fairfax Media-Four Corners investigation into the sector and Aveo in particular.
http://www.canberratimes.com.au/bus...-into-aveo-share-trading-20170628-gx08sa.html
 
AOG continue to fall this morning. Down 4.3% /12c. I don't think the market would have been impressed with the announcement this morning that AOG would offer no clarification of incidents surrounding residents because they wanted to respect their privacy.

Perhaps more to the point I think such a response will create a stronger sense of concern that their activities need to be investigated.
 
The buy back can't come soon enough for AOG, although it all smells very fishy - surely legal proceedings are in the pipeline.
 
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