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PBG - Pacific Brands
- Thread starter Ann
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Gunlom
Gunlom
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I like PBG as a long term hold, I've picked it up at $1.95, this will be a mainstay of my income portfolio for many years to come, even if eps and dps drop abit this is still a company that is gunna sell alot of products of the next few years.
plus they are on the right side of a high US dollar.
If they return to there high of almost $4, anytime in the next 2-5 years, it's be a 100% return plus good franked dividends
so as a long term hold, they are a winner in my view.
plus they are on the right side of a high US dollar.
If they return to there high of almost $4, anytime in the next 2-5 years, it's be a 100% return plus good franked dividends
so as a long term hold, they are a winner in my view.
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I am doing a bit of short term trading on PBG, bought last week at 1.08, stopped out at 1.13.
Back in again today at 1.145, tight stop, target area of 1.38 provided the rest of the world stays up for a while.
Back in again today at 1.145, tight stop, target area of 1.38 provided the rest of the world stays up for a while.
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Stopped out, small loss.
Tight stops are a necessity in the current environment, would rather be out than sitting just above a stop overnight at the moment.
If they run up then pile in, turn down then bug out
Tight stops are a necessity in the current environment, would rather be out than sitting just above a stop overnight at the moment.
If they run up then pile in, turn down then bug out
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they are getting hammered because they import their stock/materials. so when the aussie dollar is down cost of products increase.
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Do you think it should be as low as it is?
I'm sure that its level of debt has been a factor as well.
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I've been looking for a reason to hold PBG any longer... here is a short version of my thinking for what it's worth
:
(a) Sales volumes will be under pressure for 2Q 08 and 1Q 09 whilst consumers get over their saddness. (Supposedly 1Q 08 good!). Maybe Xmas will surprise and interest rates kick in but market is seemingly not banking on it. Adjustment not enduring;
(b) Gross margins will be under pressure because of xchange rates. Some claw back opportunity in form of manufacturers margin (predominantly Chinese) and maybe keener logistics and distribution costs. First 6 months basically PBG immune given forex hedge strategy and significant inventories. Margins pressure therefore not overwhelming and PBG have some time (aka small window) to refine cost of goods sold composition... target as per results presentation. Possible impact will be neutral if can claw back non inventory pruchase costs (eg labour reductions, logistics)
(c) Interest rates could be an interesting variable in FY10... Possible impact 'exciting';
(d) Debt is not a pressing issue although approx 50% (circa $420M) needs to be rolled FY10. Suspect in interim bankers (who were instrumental in building current market mayhem!!) will want to play Jesus and 'monitor' non debt reduction initiatives aka distributions.
(e) Balance sheet full of intangibles but tidy...inventory holdings might get a workout in current year to maybe free up some cash. Great opportunity to challenge exsiting inventory logistics model and refine further... possible outcome positive;
(f) Management seem competent and are stable. Actively manage risks and appear transparent
On balance:
- uncertainty (and probably over reaction) in p&l consequential of forex and sales volumes;
- misplaced hysteria re debt rolls in mkt place;
- suspect fund manager (452 Capital - significant shareholder) is or has adjusted its position (down) (although no significant shareholder notice)
and so share price under pressure. Importantly, cannot see a catalyst for change in which case price likely to drift lower. A 'left field' buyout low probability given complexity of financing any deals. Nonetheless PBG in time will present as good value at current prices.
For me, I can't stand limp share prices so I'll close out. The bottom is hard to pick!
Lastly, these are my thoughts, I am not an advisor and I've lost heavily in the market. Therefore Do your own research. Good sources include annual reports and attached presentation.
Good luck today
:(a) Sales volumes will be under pressure for 2Q 08 and 1Q 09 whilst consumers get over their saddness. (Supposedly 1Q 08 good!). Maybe Xmas will surprise and interest rates kick in but market is seemingly not banking on it. Adjustment not enduring;
(b) Gross margins will be under pressure because of xchange rates. Some claw back opportunity in form of manufacturers margin (predominantly Chinese) and maybe keener logistics and distribution costs. First 6 months basically PBG immune given forex hedge strategy and significant inventories. Margins pressure therefore not overwhelming and PBG have some time (aka small window) to refine cost of goods sold composition... target as per results presentation. Possible impact will be neutral if can claw back non inventory pruchase costs (eg labour reductions, logistics)
(c) Interest rates could be an interesting variable in FY10... Possible impact 'exciting';
(d) Debt is not a pressing issue although approx 50% (circa $420M) needs to be rolled FY10. Suspect in interim bankers (who were instrumental in building current market mayhem!!) will want to play Jesus and 'monitor' non debt reduction initiatives aka distributions.
(e) Balance sheet full of intangibles but tidy...inventory holdings might get a workout in current year to maybe free up some cash. Great opportunity to challenge exsiting inventory logistics model and refine further... possible outcome positive;
(f) Management seem competent and are stable. Actively manage risks and appear transparent
On balance:
- uncertainty (and probably over reaction) in p&l consequential of forex and sales volumes;
- misplaced hysteria re debt rolls in mkt place;
- suspect fund manager (452 Capital - significant shareholder) is or has adjusted its position (down) (although no significant shareholder notice)
and so share price under pressure. Importantly, cannot see a catalyst for change in which case price likely to drift lower. A 'left field' buyout low probability given complexity of financing any deals. Nonetheless PBG in time will present as good value at current prices.
For me, I can't stand limp share prices so I'll close out. The bottom is hard to pick!
Lastly, these are my thoughts, I am not an advisor and I've lost heavily in the market. Therefore Do your own research. Good sources include annual reports and attached presentation.
Good luck today
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As per my previous note, I no longer hold PBG. Further, after this mornings announcement I put a price alert in place whereby I'll get an email in the event PBG falls below 35 cents. The note was disappointing... a better note would have included some affirmation of trading outcomes but instead it defers any further comment until Feb 2009. Either they don't know, they don't want to say or cannot say... it leaves too much room for guessing.
My 2 cents worth but do your own research
My 2 cents worth but do your own research
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PBG once was a good yielding stock. Now without much effort from the company, they have successfully decimated the share price. Announcements which basically say we'll cut the dividend and talk again in February next year are not very helpful in a skittish market.
I suspect that the downward momemntum shall continue despite anecdotal evidence that sales (domestic retail) may not be the sad sacks foreshadowed. The remaining uncertainty is the impact of forex.
What would an announcement about earnings be worth in terms of share price increment??? However ugly the result, it would at least tell the market that management were on top of the issues...oh well
Have a great day
DYOR
I suspect that the downward momemntum shall continue despite anecdotal evidence that sales (domestic retail) may not be the sad sacks foreshadowed. The remaining uncertainty is the impact of forex.
What would an announcement about earnings be worth in terms of share price increment??? However ugly the result, it would at least tell the market that management were on top of the issues...oh well
Have a great day
DYOR
Gunlom
Gunlom
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I think that part of the major problem with the SP at the moment is major shareholders are liquidating at any price driving the SP into the cellar, namely 452 capital.
This could mean they know or suspect something bad, or they having so many redemption themselves they have no choice but to sell down at any price themselves.
The large debt ($700b) for the yakka takeover is the elephant on the room for this company. There bankers have pushed back there 1st lot of refinancing (of$150m) from feb 09 to feb 10, from memory. I think they have the revenue and profit to handle it. Cutting the div by 60% means they have a another 50 mill odd to reduce debt. with underwriting there DRP, reducing stock levels. I think they are doing enough to be around.
The basic question I think is if you can see this company being around in the future, then a PE of 1.5 is a bargain.
However investing is all about risk/return
There is definitely a chance this could go to the wall.
My gut feeling is they will survive (but I have been wrong before!!)
DYOR
This could mean they know or suspect something bad, or they having so many redemption themselves they have no choice but to sell down at any price themselves.
The large debt ($700b) for the yakka takeover is the elephant on the room for this company. There bankers have pushed back there 1st lot of refinancing (of$150m) from feb 09 to feb 10, from memory. I think they have the revenue and profit to handle it. Cutting the div by 60% means they have a another 50 mill odd to reduce debt. with underwriting there DRP, reducing stock levels. I think they are doing enough to be around.
The basic question I think is if you can see this company being around in the future, then a PE of 1.5 is a bargain.
However investing is all about risk/return
There is definitely a chance this could go to the wall.
My gut feeling is they will survive (but I have been wrong before!!)
DYOR
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Sure did, however i thought it was good 2 days ago at .25c when i jumped on. I just thought that as much as they have debt, they looked oversold to me. So i tipped it for the tipping comp this month as well as buying......worked for me with my last months tip on AIO, same deal, debt but way oversold.
michael_selway
Coal & Phosphate, thats it!
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Hm nice bounce today
Earnings and Dividends Forecast (cents per share)
2008 2009 2010 2011
EPS 23.2 20.4 17.6 20.2
DPS 17.0 0.0 0.0 6.0
thx
MS
