SUN - Suncorp Group

[Julia]

Re: SUN - Suncorp-Metway

share price movement doesn't bother me too much I'm very calm and I do sleep sound at night ... I have no margin loan to meet and no debt to pay
so I can be very flexible and make as much commitment and hold as long as I like.

the only regret is I may move too early or too late but short of the company going under price drop to $5 doesn't bother me once I bought the shares.

As long as the cheque comes twice a year at 5%-6% yield I'm more than grateful.

Well, each to his own. But being happy with a 5% - 6% yield while one's capital is dwindling seems to me an odd choice when you can have your capital intact and earning 8% in a simple old term deposit while the debacle plays itself out.

 

[ROE]

Re: SUN - Suncorp-Metway

Well, each to his own. But being happy with a 5% - 6% yield while one's capital is dwindling seems to me an odd choice when you can have your capital intact and earning 8% in a simple old term deposit while the debacle plays itself out.

Deposit offer no prospect of capital growth so in order for you to aim for capital grown you have to buy something be it property or shares

but the risk to that is your capital can go backward in short term, now if you are force to sell then you face capital lost but I play a scenario where I never ever be force to sell

so I take that risk out of the equation

unless the company goes under short term market movement doesn't bother me.

You maybe able to try and pick the bottom but I cant do that so I got to work out a strategy where I can slowly come in over a period of time and stay in for a long time

Yes stock can fall further once I done with buying but what can I do?
that's mr Market and he does that to hundred of stocks every day

I just get on with my daily life and in 30 years when I retire those company still around and pay me nice income.

some of course will disappear all together but I can weather a few disappearing stocks and still manage ok

 

[blinkau]

Re: SUN - Suncorp-Metway

ROE you seem more of a fundamentalist (like myself) have you read the book security analysis?

If so did you use any of the information in picking up SUN?

 

[ROE]

Re: SUN - Suncorp-Metway

ROE you seem more of a fundamentalist (like myself) have you read the book security analysis?

If so did you use any of the information in picking up SUN?

Yeah I read it found it to be a damn boring book and it doesn't really apply to the current environment, those was different times and accounting standard has change since then.

Stuff like book value back then doesn't really applied to book value now. Book value now are just too crazy I woudn't put too much weight on it.

I like Phillip Fisher and Warren Buffett style better where you buy no more than 10-15 stock but concentrate my portfolio on those stocks and let it run ..when one of those 10-15 stock no longer stack up or worse, gone bust
I get it off the list and replace it with something else.

I read dozen or more books maybe a whole lot more than I should on investment so I don't know which stuff I learn from what books any more.

Business section, investment magazine and time less investment books and annual reports tend to grab my attention every where I go so I tend to read a lot

I also has my iPod and iPhone so I listen to a lot of time less advices on investment through audio book when I'm driving or catching the bus.
waste time looking out the windows, may as well do something useful and learn something

One thing I learn most is this quote

“An investment operation is one which, upon thorough analysis promises safety of principal and an adequate return. Operations not meeting these requirements are speculative.”

and that hold so true, I did made some crab buy failing the thorough analysis part cos I get lazy
and I shall not repeat the mistakes, if I get lazy I don't buy

 

[blinkau]

Re: SUN - Suncorp-Metway

I am only half way through and think its probably one of the better books iv read. Its true its very old but if you know about accounting you can sort of reference it to our time.

The easy part is reading the books the hardest part is applying it.

But back on Suncorp do you think they can stick with their guidance of 107c dividend, I mean isnt their payout ratio well over 100% and they are underwriting their DRP. If the div is reduced I wonder what effect it would have on the stock.

 

[ROE]

Re: SUN - Suncorp-Metway

I don't think Suncorp can maintain this level of dividend without increase earning Period

I can only guess that the management predicting future earning will be back to normal level in a few years and that why they want to maintain this dividend payout.

Currently they are dipping into their insurance capital reserver to pay for dividend which is ok for short term that why I like banking with insurance
who else has banking and insurance? you guess it it's CBA

I have no problem with them drop dividend to half of what they paying, as long as they are prudent with their spare cash and invest and generate more money in the future.

Earning is what matter, if they earn $1 a share and pay dividend of 50 cents it still ok, it wont effect the stock price.

most analyst doesn't like SUN right now but that is their view, I got mine and it suit me just fine, I cant buy stuff cheap if everyone is buying at the same time as I'm

My prediction is in 2 years from now Suncorp will benefit from insurance premium increase and the probability of another major storm hit Queensland is low that will shield them from the banking down turn and if banking has not slow then well more cash to share holders.

at the end of the day you can either make a decision of buying a stock or not after your research and I can be 100% sure you NEVER ever get it 100% right but like Warren always said better to vaguely right than precisely wrong

 

[ROE]

Re: SUN - Suncorp-Metway

I am only half way through and think its probably one of the better books iv read. Its true its very old but if you know about accounting you can sort of reference it to our time.

I dont know anything about accounting I'm not a trained professional but the most basic maths seems to do the job well

subtract, addition, division and multiply I never knew primary school maths
can be such a useful tools, occasionally I use Year 10 maths like probability and stuff, and all the crab I learn at Uni never ever get used like 3D maths and Calculus

 

[Glen48]

Re: SUN - Suncorp-Metway

Rumour has it CBA and QBE are looking over Suncorp???
Any thoughts on which way this could go.
I see Suncorp are advertising they now cover Flood damage in every policy which means they are trying to get money in at the risk of no floods this year.

 

[ROE]

Re: SUN - Suncorp-Metway

Rumour has it CBA and QBE are looking over Suncorp???
Any thoughts on which way this could go.
I see Suncorp are advertising they now cover Flood damage in every policy which means they are trying to get money in at the risk of no floods this year.

Another day in the market with rumors and bad and good news fly left and right.

Investing short term in the market is extremely risky I say the odds are not better than the casino

but give it 10 years the risk will be hell of a lot less...

"in the short term market is a voting machine, in the long run it's a weighting machine" like Ben Graham always said and Warren recently repeating below

http://www.cnbc.com/id/26869518/site/14081545

 

[3 veiws of a secret]

Re: SUN - Suncorp-Metway

Rumour has it CBA and QBE are looking over Suncorp???
Any thoughts on which way this could go.
I see Suncorp are advertising they now cover Flood damage in every policy which means they are trying to get money in at the risk of no floods this year.

If Lloyd's syndicates underwrite the peril of FLOOD why can't Sun Metway?. Likewise if they wanted to u/write risks involving "timber" surely you could say SUN are chasing premiums.Now QBE has boxes on Lime Street,and they are as 'blue conservative' as Thatcher. I personally think SUN with the Promina portfolio might make interesting reading in the daily's.....nice spin anyway.Buy on a rumour?

 

[bas]

Re: SUN - Suncorp-Metway

There is a bit of a rumour going around that Suncorp are unable to borrow/lend money at the moment. Not sure what that means- they are up today...

 

[freddy2]

Re: SUN - Suncorp-Metway

Just reading the most recent financial results the thing the sticks out is the grossly excessive executive renumeration including short term incentives. These sort of payments are one of the main reasons the financial markets are crashing, a misalignment of employees and shareholders interests.

Interesting articles about SUN to reinforce my point about the company apparently being run for the benefit of upper management and not the shareholders.

http://business.theage.com.au/busin...anks-on-redundancy-program-20081001-4s13.html

The job cuts come as the company said it had offloaded assets to boost its capital. In any case, there's a gathering morale problem at Suncorp ”” in executive and other ranks ”” according to several employees who contacted BusinessDay.

The memo applauds staff for helping achieve cost savings. But there has been no restraint at executive level and Mulcahy and his upper management have drawn criticism for travelling with their PAs in entourages, first-class.

 

[oldblue]

Re: SUN - Suncorp-Metway

I don't hold SUN but I wouldn't put too much store on stories of disgruntled employees/poor morale. In any large organisation there are always such undertones, and very much to be expected in these " troubled" times. Plenty of financial institutions will be looking at ways to trim costs and this includes taking a hard look at staffing levels.
As for difficulty in raising money, this is a fact of life at present and the price of short term funding is rising and becoming more difficult to arrange. Expect the RBA to accommodate any extreme issues for the registered banks.

 

[ROE]

Re: SUN - Suncorp-Metway

I work in large corporate before and there are always disgruntle people, from management down to little guy.

I see it's a good oppotunity to get rid of those people during the down turn.
if you work for an organisation and you are not happy with it, leave go some where else that you are happy with get on with the job.

These people not only doing themselves a dis-service hanging around, they also infected other hard working people around them

Having said that I hope they dont employ a heavy tactics and get rid of genuine hard working people, these guys deserve a break in bad time.

I'm a share holders and I prefer their executives getting a pay cut and spare a few hard working people. I may just email them on that note

 

[freddy2]

Re: SUN - Suncorp-Metway

I don't hold SUN but I wouldn't put too much store on stories of disgruntled employees/poor morale. In any large organisation there are always such undertones, and very much to be expected in these " troubled" times. Plenty of financial institutions will be looking at ways to trim costs and this includes taking a hard look at staffing levels.
As for difficulty in raising money, this is a fact of life at present and the price of short term funding is rising and becoming more difficult to arrange. Expect the RBA to accommodate any extreme issues for the registered banks.

The point I was trying to make was about the first class travel with an entourage, not morale. If you read the annual report it certainly doesn't look like they are trimming costs in executive renumeration or benefits. Short term bonuses, especially in the millions of dollars, can never be justified for a business like Suncorp and recent events have proven this.

Further in the linked story from a memo:
"So far your efforts to quickly reduce discretionary spending have resulted in significant savings from each business unit. Since July we have seen a 33% drop in travel-related costs as people increasingly make use of tele/video conference facilities."

 

[oldblue]

Re: SUN - Suncorp-Metway

I take your point, freddy but SUN is a $10b company, even at today's depressed SP and $10b company top executives don't travel alone in cattle class!
Like you , I expect to see some trimming of bonuses and other executive perks and would be surprised if this doesn't eventuate.

 

[AnDy62]

Re: SUN - Suncorp-Metway

Take over rumours brought back to the surface again..
Saw on Sky Business that ANZ/CBA have been sniffing around.
I'm not fussed either way, SUN will come back without a t/o IMO, can't see it becoming a BNB, business model is far more conservative, particularly considering their insurance arm. Hold. I pity the lemmings who leapt when SUN was $7-8, wow, what a bargain!

 

[ROE]

Re: SUN - Suncorp-Metway

Take over rumours brought back to the surface again..
Saw on Sky Business that ANZ/CBA have been sniffing around.
I'm not fussed either way, SUN will come back without a t/o IMO, can't see it becoming a BNB, business model is far more conservative, particularly considering their insurance arm. Hold. I pity the lemmings who leapt when SUN was $7-8, wow, what a bargain!

Judging from the share price surge today something maybe be up and maybe announcement next week ?

but again just rumor in a market but it certainly getting louder each day.

http://www.businessspectator.com.au/bs.nsf/Article/Suncorp-open-to-offers-K2V6Y?opendocument&src=rss

 

[ROE]

Re: SUN - Suncorp-Metway

There is a bit of a rumour going around that Suncorp are unable to borrow/lend money at the moment. Not sure what that means- they are up today...

No rumor it's a fact ... money market dry up, most banks refuse to lend one another it doesnt apply to just suncorp it applied to everyone who are in the game of borrowing and lending money.

in the last 12 months Governments around the globe have been regularly pump money into the money market because of this issues.

 

[AnDy62]

Re: SUN - Suncorp-Metway

Hmm it's looking that way ROE, very strong finish today.
Interesting to see if anything eventuates, I think it will, but that's just a gut feel that the banks will try and reassert themselves in response to SBG/WBC. CBA is probably in the best position.