TGA - Thorn Group
- Thread starter McCoy Pauley
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Would just like to say as a clime subscriber their valuation has been lowered.
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To what, if you don't mind my asking?
By the way, I applied for more TGA shares than I was entitled to, and I got them. At $1.85 that purchase is now looking good. When TGA was selling at a low price in June, I simply did not have the funds to buy more. I borrowed most of what I needed to front with the money on 30 June, because I knew that I could repay part of it early in July, a new tax year.
I hurled about $50K at the rights issue entitlements plus additional shares, so at today's SP of circa $2.00, that looks to have been a good move. Hindsight is a wonderful thing. My daughter said she would not bother with her entitlements, but I convinced her otherwise, so that turned out well too.
Quo vadis TGA? I would like to see evidence of how well the NCML venture works for the business before I venture an "intrinsic value" for TGA.
I do not like the appellation 'intrinsic value", because it carries a sense of being objective, whereas it is highly subjective, and it changes at any point in time from person to person. There should be a word in English to cover using words to convey the wrong impression to one's audience without actually lying. For instance, calling CO2 "carbon", rather than "oxygen", which being two thirds of the CO2 molecule has a better claim as the nickname than "carbon" does. I can just see politicians struggling to justify an oxygen tax, and calling oxygen a pollutant, rather than the easier task of doing so with that black sooty stuff called carbon.
I hurled about $50K at the rights issue entitlements plus additional shares, so at today's SP of circa $2.00, that looks to have been a good move. Hindsight is a wonderful thing. My daughter said she would not bother with her entitlements, but I convinced her otherwise, so that turned out well too.
Quo vadis TGA? I would like to see evidence of how well the NCML venture works for the business before I venture an "intrinsic value" for TGA.
I do not like the appellation 'intrinsic value", because it carries a sense of being objective, whereas it is highly subjective, and it changes at any point in time from person to person. There should be a word in English to cover using words to convey the wrong impression to one's audience without actually lying. For instance, calling CO2 "carbon", rather than "oxygen", which being two thirds of the CO2 molecule has a better claim as the nickname than "carbon" does. I can just see politicians struggling to justify an oxygen tax, and calling oxygen a pollutant, rather than the easier task of doing so with that black sooty stuff called carbon.
tinhat
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Perhaps you have never heard of the carbon cycle?
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Yeah me to wish I knew how to short
May I gently suggest that you concentrate buying on stocks that have started an uptrend?
Not infallible, but works most of the time, particularly if I'm strict about applying a creeping stop loss.
May I gently suggest that you concentrate buying on stocks that have started an uptrend?
Not infallible, but works most of the time, particularly if I'm strict about applying a creeping stop loss.
Thankyou for that oldblue, I could certainly learn some patience.
It is difficult however for me to pass some of the prices thrown up by the market in the middle of a panic however.
The stop loss thing however does not apply to me as I do not use them.
skc
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TGA does do cash advance but that's only a small part of their overall business. Loan book last year was $12m and the average loan size appeared to be larger than CCV's. So they would be affected but not as prominently.
Wait until the govn't rolls out new laws on how big a TV and fridge you can rent... then they would be in trouble.
May be you should refer to your signature more often
May be you should refer to your signature more often
The trouble is my crystal ball does not work - I think I have found a bargain today but do not know if it will be more or less of a bargain tomorrow.
So my solution is to buy when I think prices are cheap enough. Having said that I take oldblues point and perhaps instead of catching falling knifes maybe I could buy when they have bottomed.
skc
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The trouble is my crystal ball does not work - I think I have found a bargain today but do not know if it will be more or less of a bargain tomorrow.
One possible way to overcome this is to monitor more companies. If you only have 2 companies you want to buy, you will more likely to jump in early because you might be concerned that both of them will run back up without you.
On the other hand if I had 20 companies on my potential buy list, I tend to be more patient. Cause chances are when the market does turn back up, some of these 20 companies would be laggards and you can still buy in at a low enough price.
Of course it depends on how much time and effort you have to analyse the investments.
So_Cynical
The Contrarian Averager
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The trouble is my crystal ball does not work - I think I have found a bargain today but do not know if it will be more or less of a bargain tomorrow.
I was thinking along the same lines before i read your post...
With now 22 stocks to watch i find myself looking at what stock that has fallen the most according to Stator and then taking a closer look at that stock, when was the last time i brought it, at what price etc...and that way its reasonably easy to pick my next average down target without getting to distracted by just 1 or 2 or 3 stocks.
All the while keeping in mind that i don't want to take more than 3 averages down and want to have about 12 or 15% falls between them...or more.
McCoy Pauley
Get out of here Budweiser!
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According to an article on FN Arena published 13 October 2011, Moelis met with TGA's management very recently and came away from the meeting comfortable that TGA's core Radio Rentals operation continues to perform well despite the challenges of a tough operating environment.
TGA's management referred to recently introduced concepts such as kiosks in metro areas and 1-2 man branches in regional centres. Moelis sees this as a low-cost opportunity to channel increased volumes into the established stores.
Moelis predicts that TGA will have 5-10 new "concept stores" opened by the end of FY12, which will offset the news that NCML lost the ATO tender. Moelis sees that the loss of the ATO tender is not overly significant, with Moelis estimating that the contract contributed less than $1.5 million to EBIT and NCML accounts for less than 15% of TGA earnings.
Moelis trimmed its EPS forecasts by 4% through FY14 - forecast EPS of 19.4c in FY12 and 21.3c in FY13. This compares to a consensus EPS estimate of 19.5c in FY12 and 21.2c in FY13.
Moelis has a "BUY" rating on TGA with a price target of $1.90/share. The consensus 12 month price target is $2.10/share, based on estimates from Macquarie, RBS and Credit Suisse.
TGA's management referred to recently introduced concepts such as kiosks in metro areas and 1-2 man branches in regional centres. Moelis sees this as a low-cost opportunity to channel increased volumes into the established stores.
Moelis predicts that TGA will have 5-10 new "concept stores" opened by the end of FY12, which will offset the news that NCML lost the ATO tender. Moelis sees that the loss of the ATO tender is not overly significant, with Moelis estimating that the contract contributed less than $1.5 million to EBIT and NCML accounts for less than 15% of TGA earnings.
Moelis trimmed its EPS forecasts by 4% through FY14 - forecast EPS of 19.4c in FY12 and 21.3c in FY13. This compares to a consensus EPS estimate of 19.5c in FY12 and 21.2c in FY13.
Moelis has a "BUY" rating on TGA with a price target of $1.90/share. The consensus 12 month price target is $2.10/share, based on estimates from Macquarie, RBS and Credit Suisse.
Concerning the matter of NCML losing a seat on the ATO panel of debt collection service providers, the four service providers under the 4-year panel contract that expired on or circa 27 September 2011 were:
• Dun & Bradstreet (Australia) Pty Limited
• National Credit Management Limited
• Recoveries Corporation Pty Ltd, and
• Baycorp Collection Services Pty Limited
NCML's share of the pie was just under $14 million, or about $3.5 million a year. What the loss of this does to EBIT, I cannot say, but the $1.5 million mooted by Moelis would, I think, be on the generous side. Why NCML failed to gain a seat on the subsequent panel is a much more interesting question. Typically, if a service supplier gains panel status, it tends to retain it via subsequent Commonwealth tendering exercises.
TGA's Interim Report is scheduled to be released in about four weeks time (22 November). It will confirm that TGA's core business is performing well, because recent formal announcements have stated as much. That report should provide the metrics to extrapolate what the full year ending 30 March may be.
• Dun & Bradstreet (Australia) Pty Limited
• National Credit Management Limited
• Recoveries Corporation Pty Ltd, and
• Baycorp Collection Services Pty Limited
NCML's share of the pie was just under $14 million, or about $3.5 million a year. What the loss of this does to EBIT, I cannot say, but the $1.5 million mooted by Moelis would, I think, be on the generous side. Why NCML failed to gain a seat on the subsequent panel is a much more interesting question. Typically, if a service supplier gains panel status, it tends to retain it via subsequent Commonwealth tendering exercises.
TGA's Interim Report is scheduled to be released in about four weeks time (22 November). It will confirm that TGA's core business is performing well, because recent formal announcements have stated as much. That report should provide the metrics to extrapolate what the full year ending 30 March may be.
