CGF - Challenger Limited

Miner said:

Now, look at those paid newsletters. Share Advisor of MF - has not scored positive more than 10% of their recommendations in the 2018 calendar year. They charge a fortune among some 12 different newsletters. No one complains there even if MF clearly says buy this and that. So why should people complain here? HC gets all goss and they have thousands of followers.

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Bell Potter our preferred stocks for calendar 2019: Challenger is one of the 10 picks, experts get it wrong all the time..

https://www.belldirect.com.au/smart...ell_Potter_End_of_Quarter_Review_Dec_2018.pdf

$7.20 is the bottom so far and today is 1 week since the big fall - is the bottom in?

So_Cynical said:

$7.20 is the bottom so far and today is 1 week since the big fall - is the bottom in?

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I suggest that there is absolutely no way to tell from the chart that the bottom is in. Volume is still relatively high so this stock may be in accumulation.

[edit] I have been accumulating.

So_Cynical said:

$7.20 is the bottom so far and today is 1 week since the big fall - is the bottom in?

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tinhat said:

I suggest that there is absolutely no way to tell from the chart that the bottom is in. Volume is still relatively high so this stock may be in accumulation.

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Higher highs and lower lows on falling volume, the bottom is certainly in for now with the BRC uncertainty lifted, will crack 8 dollars early next week i would think.
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So_Cynical said:

Higher highs and lower lows on falling volume, the bottom is certainly in for now with the BRC uncertainty lifted, will crack 8 dollars early next week i would think.
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SC and all
Good morning on this thread.
I could be 'cynical' today to make a speculation that CGF would see the bottom today after closure of market after publishing this report
https://www.asx.com.au/asxpdf/20190417/pdf/444csnv0vb7b5p.pdf
I would be pleasantly surprised to see the price going north.
Have a nice day.
disclaimer : a holder and having patience tested on CGF at the moment

Patience is a virtue, the SP has gone thru $8 a few times and retreated down again and got close too but not tested the $7.20 low, still would only take one
or 2 bad days to see that happen, long term the fundamentals are good, it will take a while to work thru the current advise industry problems, FF dividend
yield of around 4.4% better than a bank TD easy, little risk at this price i would think.
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So_Cynical said:

Patience is a virtue, the SP has gone thru $8 a few times and retreated down again and got close too but not tested the $7.20 low, still would only take one
or 2 bad days to see that happen, long term the fundamentals are good, it will take a while to work thru the current advise industry problems, FF dividend
yield of around 4.4% better than a bank TD easy, little risk at this price i would think.
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View attachment 93895

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Does it get better for you now it’s in the $6s? The interest rate headwinds and that revenue drop, coupled with what looks like a smaller dividend isn’t looking too favorable.

Thoughts?

JTLP said:

Does it get better for you now it’s in the $6s? The interest rate headwinds and that revenue drop, coupled with what looks like a smaller dividend isn’t looking too favorable.

Thoughts?

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Shaw Wallace declared CGF a sell. One can argue why they did not say yesterday ? Common sense prevails to assume first the exited their own fund, then advised their sophisticated investors and finally en masse to slide the market.
Bell Potters and rest of the broker community also declare sale.
Unfortunately I coughed my stop loss and exited.
My gut feeling the Norwegian exit will also drive lot many fundies share prices just on news as well EOFY. That should give opportunity to pick up some good stocks at depressed price.

Miner said:

Shaw Wallace declared CGF a sell. One can argue why they did not say yesterday ? Common sense prevails to assume first the exited their own fund, then advised their sophisticated investors and finally en masse to slide the market.
Bell Potters and rest of the broker community also declare sale.
Unfortunately I coughed my stop loss and exited.
My gut feeling the Norwegian exit will also drive lot many fundies share prices just on news as well EOFY. That should give opportunity to pick up some good stocks at depressed price.

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We’ll see. This has been quite a ride since the GFC - I’m sure there will be value at some stage. I remember thinking the annuity business would be tough in a low growth environment though...

Hmmm ....

well the update was not great. Its been written on the wall the difficulties it has been under for some time.
It is NOT worthless despite the current spate of selling.
It makes money, just not as much a growth story as it once was thought to be.
Retirement and annuity funds are a much needed tool with longer life expectancy.

That said, I don't think their dividend is too much under threat. Much like my views on banks pre election. One hand the 7% dividend there unlikely to grow over time and ... well say under $25 for some a couple of times it was a buy and feeling like a bank teller with all the financials and magic rallies of 10% .... only to be hit with reality as we are seeing now. Banks well off highs and new capital requirements the latest impost. Suspect we revisit those old lows .

CGF, whilst the absurd strong buy calls and targets of $12 now replaced with 8-9 ones. The share price obviously has had a cow at $6.50 as though the world has ended. We seem to be seeing this with a lot of stocks from AGL going maybe we buy a telco for 20% of market cap and shedding 10% in the blink of an eye MORE than the bloody thing would cost. WES another doing much the same with the Lynas deal which by the way would have been brilliant had they done it given the uncertainty over those minerals and the price shed for a massive company 20% to absurd levels only to rally as they gave out a massive bonus to now .... Retail side and even Bunnings sales not so hot. Again suspect they revist the $32- levels .... irrespective of the ASX.

CGF as opposed to banks has a brighter long term outlook for profits as its product is so niche and specialized and likely in more and more demand all be it slowly, they eventually will get their game sorted. So ... for me ... its much like some other absurd price flops a BUY down here and lower.

SGR similar, Star Casino and whilst a love rally as Packer seemed to sell well above market, only to fall through, casinos are if decently run hard to loose on. Trump did but was so stupid and leveraged as well as a crook they failed. Something worth $5.50 absurdly 12 months ago but above $4.50 at $3.60 low is ignoring all else, eventually as your paid a decent dividend becoming cheap.

CGF ... well at $5.60 a 5.4% yield and fully franked. Things obviously not so good and they can only improve. I note for most of the stocks mentioned above CBA and Now perpetual announcing its sold out.

Nothing like taking your loss.
Not sure ... they are correct.
I own and will slowly add as I did with say APA as it was shredded 15% to $8.50 and now is at $11=

Levels ... and risk size small given the current state of affairs there. Not trading, its longer term for better or worse. Bigger holds if I should be so lucky to get re-entry into say some banks I lightened up upon of late. As for APA I have reduced and taken most off the table with a mere core token holding.

Take care

JTLP said:

Does it get better for you now it’s in the $6s? The interest rate headwinds and that revenue drop, coupled with what looks like a smaller dividend isn’t looking too favorable.

Thoughts?

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I wasn't actually bullish before just not bearish/negative, broadly i think the whole market has started to seriously price in a recession, sentiment has turned a bit, with Challenger
perhaps some people are looking at industry super funds pension phase as a kind of annuity, many stocks falling.

I got out on 13 June at $7.044 average price. No point owning a share with negative earnings growth, forecast negative earnings growth and that has lost market sentiment.

Bounced off the bottom of 2 weeks ago, they also have a newish listed (managed) Bond Fund (XARO) that is core to their Annuity business - AMP
and IOOF were a big sales channel for their annuity's though not so much any more, i expect a big splashy new ad campaign, they should get stuck
into the SMSF and direct retail sales channel.

Regardless of all the fundamentals when my system says buy and it passes the "eyeball" test then I buy.
Going the right way so far.

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Amazing. Three separate letters from Computershare in my post box re CGF.
(happens with every purchase as you all know !)

One is an ASX Chess holding statement, one a confirmation of my email address and another confirming my banking details. You would think that they could at least put them all in one envelope !

Who is paying for all of this outdated nonsense ?

Boggo said:

Amazing. Three separate letters from Computershare in my post box re CGF.
(happens with every purchase as you all know !)

One is an ASX Chess holding statement, one a confirmation of my email address and another confirming my banking details. You would think that they could at least put them all in one envelope !

Who is paying for all of this outdated nonsense ?

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@Boggo - I believe clever automated software with no cost to the sender but costing the readers to read multiple messages.
Outside Computershare like companies I got messages from Qantas to remind of my boarding time for flights to be departed and then again saying flights have departed - whereas the fact was the flight was cancelled due to Newman airport damage. Once again the cost of the anxiety of such messages lies on the reader. I am now buying pink salt and lemon pickle on such messages

Follow on from #94 above.

It's busted through the expected resistance at $9 and is on it's way to the next level.
It may spend a bit of time at or between the next two decision making lines.

There will be some profit takers along the way but the report sounds positive for the long term.

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ASX announcements today included "1H20 results" (uploaded) and SP up 12.68% and hit 12 month high today







Managing Director and Chief Executive Officer, Richard Howes said Challenger is on track to achieve 2020 full year normalised net profit before tax around the top end of its guidance range of $500 million to $550 million.

Outlook
Challenger remains well positioned to optimise performance while also positioning for future growth. FY20 normalised net profit before tax is expected to be around the top end of Challenger’s guidance range of $500 million to $550 million.

Challenger is also on track to achieve its normalised return on equity target of the RBA cash rate plus a margin of 14%.

The full year dividend is expected to remain unchanged from FY19 at 35.5 cents per share, which is above the target dividend payout ratio of 45% to 50% of normalised net profit after tax, reflecting Challenger’s strong capital position and confidence in future growth.

250

Time passes and the market comes around, under $7.50 was the buy zone, i loaded up and i'm looking sweet, i waited 5 years to buy this stock.
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Incredible VFC induced price action today, Low 5.38 ~ High 6.27