TGA - Thorn Group

[hiddencow]

Thanks for the kind words VS, I'm still at the beginning stages on what will hopefully be a long and prosperous investment journey. Working in accounting gives me a head start on looking at financial reports.

 

[tinhat]

I sold out of TGA today reluctantly. This stock was in my mum's super account which is in pension mode and I figure there are better dividend yields out there given the price TGA is now trading at (I picked up a few more ANZ today). The RSI on the weekly chart has gone above 80. With only about six weeks to the next ex-dividend date I've sacrificed the dividend and franking credits to do so (8.6c per share). If the price corrects I might buy back in. Knowing my luck it will keep on kicking up. 122% gross return over three years of holding. I wish all my stock picks performed as well.

 

[oldblue]

A great return tinhat!

I'm hanging in there but must admit that an RSI that strong looks vulnerable. On red alert!

 

[Nortorious]

Hi Tinhat,

I must have bought your shares as I entered this stock today.

I'm expecting a nice rise and if I get the divvy that will be a bonus. I'm in it for capital gains.... Short or long term depending how it progresses....

 

[ukulele]

TGA shot up past the psychological level of 3.00 pretty convincingly on 04/12/14, albeit only on slightly higher volume.

I suspect it will now consolidate between 3.00 and 3.10 for (hopefully) another move up. A bonus is the small dividend next month. Right now my stop is @ 2.98 (just below 3), just incase the trend changes.

Appreciate any other thoughts?

 

[ukulele]

Got Stopped out of this a couple of weeks back at 2.98. Perhaps my stop was too tight! Dems the breaks I guess.

After trying a few times for 3.1, TGA finally closes above it, however volume was light (although that is expected at this time of year). Good luck to holders.

 

[Huskar]

Pulled back near 20% now from 3.11 high on apparently no news. A large holder heading for exits?

 

[Tightwad]

no idea really. falling au dollar should increase the cost of importing electrical stuff and impact margins... but then lower petrol prices mean more disposable cash for some people.

 

[tinhat]

This company has had a solid management, strong balance sheet and steady results, but real no earnings growth now for years. It operates in an industry where you have to assume that the margins in its traditional market segments, and product mix are not going to hold up.

Go back thirty or forty years ago and most people use to rent their telephone from The Post Master General's office (later, Telecom). They would pay a rental fee that was added onto the phone bill.

The value of this share in the long run depends on your faith in whether management can find and exploit the opportunities where future profitability lies. I recall posting these same comments a while ago. I don't follow this stock closely but I don't see great value at the current share price. That said, with another rate cut, income invested chasing franking credits will keep this boat afloat price wise.

The price is hovering around the October 14 peak and the November 13 peak. Will it break below?

 

[VSntchr]

A scathing article by ABC on Thorn, specifically "Radio Rentals", extended the negative sentiment towards TGA today.
ASIC has been pretty active on the payday lending sector of late which has brought down the prices of CCV, MNY along with TGA and CCP.

Regulation risks are always around these businesses but I think the points highlighted in the article are pretty stretched and look to be searching for headlines.
http://mobile.abc.net.au/news/2015-...aps-90-million-in-centrelink-payments/6333690


Price looks like it fell through support and stop losses triggered a further sell down, but price has since recovered..

I haven't owned TGA for a while but if the negative sentiment remains in this sector it may get enticing in a few months time..

 

[notting]

Strong reversal and buying off the low today as it tested a break down through 2.60.
Well supported at this point!
Perhaps the end of an ABC correction.

 

[hiddencow]

Pretty much the same article was published last year:
http://www.abc.net.au/news/2014-11-27/companies-accused-of-preying-on-vulnerable-consumers/5921924
Didn't have any reaction then.

Bought back some of my TGA shares today that I sold late last year, thank you very much

 

[robusta]

Results out today.

Revenue up 25%, NPAT up 8.5%, underlying up 13.6% looks like nice growth.

http://www.asx.com.au/asxpdf/20150527/pdf/42ytnl64m2lcqy.pdf

 

[Ann]

TGA is traveling upward in solid channel pattern on the monthly chart. It may show some weakness after a Hold recommendation was put on it by two brokers on the 4/6/15 and will be going ex dividend on the 30/6/15. This may drag the price lower toward the rising channel support line and potentially offer a buying opportunity for anyone interested in the stock. It offers a Dividend Reinvestment Plan for anyone interested.

 

[galumay]

Yep, TGA has gone up solidly on the back of very good results, its been a very good investment for those that understood the financials of the company and its potential. As a result of the recent results I have changed my IV calculation for TGA and will continue to pick up the cheque everytime it passes go!

 

[Ann]

Sadly TGA did not continue its merry walk along the rising channel. It fell profoundly through and didn't stop until it hit an old $2 support/resistance line. Now I am thinking the original rising support line may well offer a new resistance, potentially forcing it back down eventually to the $2 support line or even lower in a worse case scenario.
A stock I had contemplated buying, but no longer at this time.

 

[galumay]

...
A stock I had contemplated buying, but no longer at this time.

Looks like good buying to me! It is now trading well below intrinsic value - which increased last FY with healthy EOFY results showing improved results on most metrics i look at.

The only reservation is the growth in debt to a level that is approaching my upper level of comfort, but I suspect it will be pretty quickly paid down.

The whole sector has copped a flogging recently, some good value to be found at the moment, I hold TGA but topped up CCP with spare cash as I think they are an even better company long term.

ps thanks for the post - i hadnt got round to running the financials for 14/15 thru my valuation spreadsheet so you prompted me to do it!

 

[Ann]

Looks like good buying to me! It is now trading well below intrinsic value - which increased last FY with healthy EOFY results showing improved results on most metrics i look at.

The only reservation is the growth in debt to a level that is approaching my upper level of comfort, but I suspect it will be pretty quickly paid down.

The whole sector has copped a flogging recently, some good value to be found at the moment, I hold TGA but topped up CCP with spare cash as I think they are an even better company long term.

ps thanks for the post - i hadnt got round to running the financials for 14/15 thru my valuation spreadsheet so you prompted me to do it!

G'day galumay why I am a little pessimistic is there is what appears to be a bearish chart pattern called a 'head and shoulders' forming. I didn't draw it into the chart, it would have made it too messy, I will next time if it evolves further. It has formed the left shoulder and head, it appears it may bounce back off the $2 support line and make its way back up to that rising bottom line on the channel and this may send it back down again creating the right hand 'shoulder'. This is a bearish pattern which may lead to some downside in the medium to longer term. Gosh that sounds like gobbledygook without any pictures to show, sorry folks!

 

[galumay]

Thanks for the explanation Ann, it helps confirm for me why I would never use TA for investment selection!!

I am not trying to be rude or smartarse in saying that - simply that I so profoundly dont get the idea that charting the historical price action is of any use in predicting the future price action - and is irrelevant to understanding the fundamental value locked within a company. (please others, dont drag the thread away into a strategy debate.)

I do always read your posts and its often a prompt for me to do some inversion thinking and think about why price might be moving in the opposite direction to my perceived value - is my value incorrect? are there aspects of the financials I have missed? what might make the market misprice a company?

Alternatively when your analysis coincides with mine in terms of price action then I can allow myself to feel slightly smug - when and if the fundamental reason for the action is one I forsaw!

 

[Ann]

Thanks for the explanation Ann, it helps confirm for me why I would never use TA for investment selection!!

I am not trying to be rude or smartarse in saying that - simply that I so profoundly dont get the idea that charting the historical price action is of any use in predicting the future price action - and is irrelevant to understanding the fundamental value locked within a company. (please others, dont drag the thread away into a strategy debate.)

I do always read your posts and its often a prompt for me to do some inversion thinking and think about why price might be moving in the opposite direction to my perceived value - is my value incorrect? are there aspects of the financials I have missed? what might make the market misprice a company?

Alternatively when your analysis coincides with mine in terms of price action then I can allow myself to feel slightly smug - when and if the fundamental reason for the action is one I forsaw!

Everyone to their own decision process galumay, however when I am selecting a stock, I do a darn sight more than just read a chart and cross my fingers! I start with a chart and if I see potential I then go into the fundamentals. However all fundamental and chart information is based on past history. I figure it is hard enough to make a good choice so the more information I have to base my judgment on the better...and charts I can take a quick glance which may be no more than one second. Saves a lot of reading in the beginning.

An old lady I met some thirty years ago made a huge amount of money on shares over the years, I asked her how she chose them. She said she just bought the shares people kept talking about, no charts no fundamentals just the newspaper business section and what kept being mentioned. I think everyone needs their own way and then just persist with it.