ARB - ARB Corporation

[Dona Ferentes]

from a high at start of year nudging $55, ARB had a fall yesterday to be close to $46 after a brokerage house brought out a report of likely margin compression.

after the January tumble, to just above $41 last week, there has been a 10% lift today

ARB shares are trading higher after it reported its unaudited preliminary results for the first half of financial 2022.

• Sales revenue rose 26.5 per cent to $359 million in six months ended December 31 from the year-earlier period.
• ARB said it expects pre-tax profit to be between $90 million and $92 million.
• ARB maintained a positive outlook based on its strong customer order book and improved inventory levels, notwithstanding continuing COVID-19 challenges, ongoing delays in new vehicle availability and global economic uncertainty.

 

[Dona Ferentes]

after the January tumble, to just above $41 last week, there has been a 10% lift today

The roller coaster continues .... down 11% (and as low as $32.60) on today's Market Update, after warning solid sales growth was offset by rising costs and the supply chain dislocations that are weighing so heavily on global vehicle sales.

The Company maintains a positive outlook:
• Customer order book remains consistently high
• Inventory levels increased to buffer against extended lead times
• Impact of new models, including the Toyota LandCruiser 300 Series and the new Ford Ranger, are yet to flow through
• Emerging partnerships with major customers
• Exciting new products currently under development.

The Board and management are very focused on mitigating key challenges including staffing shortages (particularly in accessory fitment), operational and material cost pressures, global shortages of new vehicles and continuing disruptions to supply chains and shipping networks.

 

[rcw1]

Good morning
ARB appears to have dive really well to overcome some supply chain issues and delays in new vehicle imports, as the company reported $122m net profit in the 2022 financial year, an 8.1 per cent increase on the previous year.

ARB will pay a final dividend of 32 cents per share on October 31, which is below last year's 39 cents per share payment.

ARB SP very dynamic this morning (23/08/22).

Kind regards
rcw1

 

[finicky]

Just idly noticed that ARB recently got down to what I regard as around fair value - $25 - but has since rallied. Skipped my notice. Could be moving outside its downtrend resistance? Some great results recently but until shown otherwise I'd have to see ROE of slightly under 20% as the median. Grows its BV year after year.

Not Held

Weekly

 

[finicky]

Wow ARB down 4 bucks, over 12%, that'd have to be a novelty. Dec Half market update with a big fall in the estimated profit before tax to pcp. Something about 5% lower revenue but also margin hit by higher costs (steel and freight seem to be big ones). They give a pretty upbeat outlook though for when they're through this and there seems to be some recovery already. Wonder what the 37% drop in sales to original equipment makers is about.

Really the chart doesn't look too bad to me although it looks likely to drop to support around $26 if $28 doesn't hold the decline. But at the close of $29 today it still seems a bit over-valued to me?

Not Held

Daily

 

[Dona Ferentes]

Wow ARB down 4 bucks, over 12%, that'd have to be a novelty. Dec Half market update with a big fall in the estimated profit before tax to pcp. ...

Really the chart doesn't look too bad to me although it looks likely to drop ...

Yeah, I was looking at it yesterday. And here's the rub

.. preliminary, unaudited management accounts for 1H FY2023, the Company achieved:
• Sales revenue of $340.9 million, down 5.1% compared with the previous corresponding period. Pleasingly, the second quarter of 1H FY2023 was slightly ahead of the same period last year, an improvement from the 10.0% decline in the first quarter reported at the 2022 AGM.
Sales to the Australian Aftermarket achieved 2.7% growth during 1H FY2023, whilst sales to export markets and original equipment manufacturers were consistent with expectations at the 2022 AGM, down 8.8% and 36.9% respectively.
• Profit before tax within the range of $64.0 million to $64.6 million, a decline of 29.7% compared with the previous corresponding period. The profit result reflects the lower sales and the inflationary impact on the Company’s cost base in particular.

Ok, so it was good news/ bad news, and what happened? The Ann came out before the bell on Mon 06, and there was a bit of price discovery. But today Tues 07th, it tanked. Why?

....  my random thoughts. ... Results not really a shock, usual argy bargy on release, and a bunch of forward looking assumptions already baked in; but overnight, some big holder (US?) woke up and said, "sell the lot". And the rot set in..

I COULD BE completely wrong. (= Mr Consistency, at the very least)

 

[galumay]

But at the close of $29 today it still seems a bit over-valued to me?

Its significantly overvalued by my metrics, i looked at it seriously last when it was around $18 and chickened out because I still didn't see a discount to value. No doubt it will rip back to $50 and I will look like a dill......again.

 

[DrBourse]

And for todays useless bit of info I humbly submit the following (May as well throw my thoughts on ARB into the ring)…….

I last looked at ARB back on 19/11/22 – Their IV at that stage was $25.52 to $26.23 - Margins of Safety (MOS) were Very Good – Ratio’s were Good…….

Not sure why punters are so surprised at yesterday’s pullback – I still feel $25/$26 is where ARB belongs…….The Announcement on 6/2/23 was just confirming most other analysts calculations.

The Grid below shows my past 5yrs calculation results for ARB & the chart below that shows Support @ that same $25/$26 area – so IMO there could be more downside to come.

On a Chart, when the Linear Regression is in a "SHALLOW or MILD UPTREND", I would look at the Bottom Line of the Linear Regression as approximately where the IV rests - the Linear Regression Centreline is where IMO punters will push the SP to – and the Linear Regression Top line is where the Idiots of this world will push the SP to – The trick is to judge Entry & Exit Points along the way – that’s where the CCI/MFI combination comes into play.

End of lecture.

Cheers.

DrB

 

[Dona Ferentes]

• ARB has cut its final dividend to 30¢ a share from 32¢ a year ago as profits slid by 27.5 per cent in 2022-23.
• Net profit after tax dropped to $88.4 million because of inflationary pressures, a weaker Australian dollar and disruptions in sales to the US where a major retail customer, 4 Wheel Parts, was sold and restructured.
• Sales revenue slipped by 3.4 per cent to $671 million.

The company said it expects to return to growth in both sales and profits in 2023-24 as inflationary pressures ease, and the supply of new vehicles around the world improves following supply chain disruptions.

.... down more than 10 per cent

 

[finicky]

Greg Canavan, an admirer of ARB, was saying a few months back that either it was overvalued or its litter mate GUD undervalued.

Not Held

 

[finicky]

ARB chart staged a nice break above $34 resistance last week.
As usual I have reservations for my purposes about its price, I see it as worth about $32 at a stretch and using an inferred fy24 book value of ~$8 and some consideration for uninterrupted growth. But I'm thinking that buyers will always be ready to attach a premium to ARB and its value eventually catches up to price (so far). Similar to stocks like CSL, PME and RMD...

Not Held

WEEKLY

 

[investtrader]

If I had $2.9 billion I wouldn't buy a business that makes $90million.

 

[Dona Ferentes]

ARB seem to have put themselves back in favour with the 1H 24 results. Up 10 per cent today.
I guess all those beastie utes need to look pretty, for the slight possibility they go off road.
.

.

 

[Dona Ferentes]

ARB seem to have put themselves back in favour with the 1H 24 results. Up 10 per cent today.

ARB is holding on to its ten percent lift, just below $40

Looking at a longer term SP performance, is that a Covid sugar hit distorting the general trajectory?

 

[mullokintyre]

ARB has a particular market, mostly the offroad kids beefing up their rigs to be pretend cowboys, then there is the grey nomad towing fraternity beefing up their rigs to tow their home away from home.
if ICE cars do die, (bit of a question mark over that these days), the electric/hyrogen/Nuclear/EMdrive/ etc/ replacements will still have those markets.
If all those ranger utes are replaced with equivalents powered by something else, the same issue for the owners will still exist.
They will want ynderbody protection, lift kits, beefed up suspension, electric brakes, GVM upgrades, andersen plugs, bull bars and side steps, bead lockers and wider tyres, winches, canopies, trays, dual axle conversions, roof top tents, dual batteries, dometic fridge with installations, specialised ally boxes with rooftop solar, Cb radios, extra roo stunning lights, air lockers, beefed up transfer cases, range extenders instead of larger diesel fuel tanks, just to name a few.
I was surprised to see on a US made 4WD show one of the presenters talking about installing the 'high quality ARB Air lockers", so they have reasonable penetration in the US market.
I reckon ARB will be around a bit longer.
Mick

 

[Dona Ferentes]

someone wrote, ARB has a PE higher than Nvidia' s
.
...results out, shares up 7 per cent to $43.20

Profit before tax of $142.7 million represents growth of 17.1% over the previous financial year, excluding a one-off capital expense of $2.5 million relating to the final deferred consideration payment for the acquisition of the Truckman business and a one-off capital gain of $1.2 million relating to the sale of a factory in Thailand.

Profit after tax excluding these two adjustments was $104.1 million, up 18.1% compared with the previous financial year.

Reported profit for FY2024, which includes the two adjustments noted above, was $141.4 million before tax and $102.7 million after tax. This represents an increase of 15.8% and 16.1% respectively over the previous financial year.

The Company has declared a final fully franked dividend of 35.0 cents per share. This brings total dividends for the year to 69.0 cents per share fully franked, an increase of 11.3% compared with last year. The final dividend will be paid on 18 October 2024 and the Record Date will be 4 October 2024. The ARB Dividend Reinvestment Plan and Bonus Share Plan will be in operation for the final dividend to assist with the funding of ARB’s ongoing expansion programme.

 

[mullokintyre]

someone wrote, ARB has a PE higher than Nvidia' s
.
...results out, shares up 7 per cent to $43.20

Profit before tax of $142.7 million represents growth of 17.1% over the previous financial year, excluding a one-off capital expense of $2.5 million relating to the final deferred consideration payment for the acquisition of the Truckman business and a one-off capital gain of $1.2 million relating to the sale of a factory in Thailand.

Profit after tax excluding these two adjustments was $104.1 million, up 18.1% compared with the previous financial year.

Reported profit for FY2024, which includes the two adjustments noted above, was $141.4 million before tax and $102.7 million after tax. This represents an increase of 15.8% and 16.1% respectively over the previous financial year.

The Company has declared a final fully franked dividend of 35.0 cents per share. This brings total dividends for the year to 69.0 cents per share fully franked, an increase of 11.3% compared with last year. The final dividend will be paid on 18 October 2024 and the Record Date will be 4 October 2024. The ARB Dividend Reinvestment Plan and Bonus Share Plan will be in operation for the final dividend to assist with the funding of ARB’s ongoing expansion programme.

Bugger, have had a buy order in at $36 for about a six weeks.
Don't think I will be getting any at that price unless there is a general market dumping.
One I want to add in my long term holdings.
Mick