Thursday, August 21, 2014

Meeting 43 - Brevelle

ITS IN A FEW WEEKS TIME DATE MAY CHANGE PLEASE CHECK THE GOOGLE CALENDAR FOR DATE AND VENUE DETAILS AT THE WEBSITE HERE

After a Hiatus we are back with a club meeting

Stock for evaluation is Brevelle ASX BRG

Breville Group Limited is engaged in development, marketing and distribution of small electrical appliances. The Company operates in four geographical segments: Australia Distribution, North America Distribution, New Zealand Distribution and International Distributors. The Australia Distribution, North America Distribution and New Zealand Distribution operating segments distribute primarily small electrical appliances to retail customers in their geographical locations. The International Distributors operating segment distributes primarily small electrical appliances to distributors in international locations. In Australia and New Zealand, the Company trades under its company owned brands, Breville, Kambrook and Ronson and also distributes a range of Philips products in the personal care and garment care categories under a license agreement with Philips.

Annual Reports can be found at the coorporate website here



PRIOR TO MEETING
The stock has taken a bit of a tumble recently so what we need to do is come up with a valuation of the stock each prior to the meeting

  1. Please visit the website and print a few annual reports to review and bring them along.
  2. If you have worked out a valuation please put your workings for the valuation of the company in the google docs sheet here - just add a tab with your name on it.
AT THE MEETING
  • Compare valuations discuss 
  • Have a drink
  • Dinner?

Wednesday, June 6, 2012

Meeting 42 - Thorn Group

Thorn Group Limited is engaged in renting and sale of browngoods, whitegoods, personal computers (PC) and furniture products, the provision of unsecured cash loans, equipment finance and the provision of receivables management services. 

The Company operates in two divisions: Rental division and the Credit Management division. The Rental division includes the rental and sale of browngoods, whitegoods, PC and furniture products. The Credit Management division is consisted of the National Credit Management Limited (NCML) business, which includes receivables management, debt recovery, credit information services, debt purchasing and other financial services. 

Other operations consist of Thorn Equipment Finance and Cashfirst businesses. Thorn Equipment Finance provides equipment financing for small and medium enterprises and Cashfirst involves the provision of personal loans.

Please Place Valuation onto this spreadsheet It has public access to edit. Please add a new tab for your valuation notes with your name on

THE MEETUP
The time of the meetup may change please check the calender above for updates

Saturday, January 28, 2012

Worldwide debt at unprecedented levels

We are in unprecedented times in case there's any doubt the amount of debt the world has right now has never been this much,  ever. Public debt is very high in the euro zone, Japan and the US and private debt is at record levels all around the world.  

Public Debt
Back in August 04 2011 Fox News published an article explaining that the US public debt  was then $14.58 trillion which is equal to the GDP of the entire US economy and approximately 1/3 of the global GDP.


How big is the debt per head?
14.58 trillion dollars (100% of US GDP )equates to approximately 47k per US citizen or 135k per US  taxpayer. source http://www.usdebtclock.org/ 


How does this compare Worldwide? 

Looking at the Public debt in comparison to other countries from  wikipedia. There is also another site with a view of some this information over time by country




How Does it compare over time?
Looking at the debt over time the graph below ends in 2009 but if you drew it out to 2012 with a GDP to debt percentage of 100% you would see that the US debt is the largest it has been since WW2. From wikipedia

How does the debt compare to other Countries?

UK
Current UK debt is running at about 70% of GDP which is the highest it has been since 1965. source http://www.ukpublicspending.co.uk/debt_brief.php


Australia
Currently the debt is running at $112 billion (16k per person). source http://www.debtclock.com.au/
2011 GDP is $925 US bn  which equals 27% of GDP

Others
Greece's debt is 143% of GDP
Ireland 's debt is 112% of GDP
EU (2010)  debt is 82.31% source wikipedia 
Japan 205%

What About Private Debt?
Private debt is otherwise known as consumer or personal debt and is very significant.

United States
US government debt is at its highest it has been since the second world war. Private debt has never been as large as it is today



The chart above shows that public debt in the US is 320% of GDP in 2011. According to wikipedia in 2011 US private debt was $50.2 trillion (The global GDP). This means that in total US debt is around 420% of US GDP. As far as other countries go private debt is not as high as the US but in most cases it is an all time high.

UK
100% of the GDP in 2011. source the Telegraph
This figure was around 400bn in 1993 it is now 150bn
Others
Below is a chart that gives personal debt to income by country



Global Debt
So in conclusion debt levels have never been this large, ever. 

Tuesday, December 13, 2011

Meeting 41 Cochlear


COCHCLEAR Website

Google finance

Cochlear Limited (Cochlear) operates in the implantable hearing device industry. The Company operates in three geographic segments: 


  • Americas, 
  • Europe 
  • Asia Pacific. 
Cochlear has established special purpose entities (SPEs) for trading and investment purposes. The Company’s Cochlear Nucleus 5 system includes a cochlear implant, a sound processor, including an automatic phone detection feature. 

Annual Reports

Our Analysis - Read Only (use link I emailed to edit)

Thursday, October 6, 2011

Meeting #40 Valuation Invocare


INVOCARE WEBSITE

" InvoCare owns and operates funeral homes, cemeteries and crematoria around Australia, New Zealand and Singapore. InvoCare is well known for its commitment to family care, community engagement and investor value."


Valuations can be found here

For date of meeting see the calendar at the top

Thursday, September 1, 2011

Meeting #39 IRI

Prognosis  IR is a leading global provider of high-definition performance monitoring, diagnostics and reporting software. IR is the the creator of award-winning Prognosis® and PowerMinder®


Design, development and sale of systems and applications management computer software for business-critical computing and Internet protocol (IP) telephony networks.


The Company’s PROGNOSIS product range is an integrated suite of monitoring and management software, designed to give an organization’s technical personnel operational insight into their HP NonStop, Windows, uniplexed information and computing system (UNIX) and Linux servers, and IP telephony environments and the business applications that runs on computer software. PROGNOSIS is used in automated teller machine (ATM) and Electronic Funds Transfer at Point of Sale (EFTPOS) transaction systems, Web applications and telecommunications systems. It services customers in more than 50 countries. The Company generates the majority of its revenue from upfront license fees, recurring maintenance and recurring license fees.

Data from Reuters

The Meeting
Thanks for Gilles, Tom,Mark, Cameron and Camerons Brother for coming on Wednesday.

Overview
The company routinely has a high profit margin and return on capital in the mid 20's it has no long term debt and consistent earnings there is also very little share dilution and little options. The MD has been with the company for along time and he hold a good chunk of shares and also the company is in a space (IP telephony) that could make it a takeover target in future. On the negative side the earnings are flat (falling just short of inflation).  The dividend payout is routinely 90% of the yearly earnings.

Valuation
Special thanks to Cameron for driving a truck through my incorrect valuation method! My flawed valuation came up with a valuation of $1.05, both Cameron and Mark came up with around 18 cents. Tom came up with more (about 60 cents - I think)

Valuations spreadsheet will be found here


Next Meeting

We will be submitting valuations of Invocare

Wednesday, August 24, 2011

Meeting #38 - MTU


M2 Telecommunications Group Limited is engaged in the supplying of fixed line voice, mobile telecommunications and broadband data services within the Australian and New Zealand markets through its retail and wholesale operating divisions. Retail business segment offers unique packaged telecommunications services, targeted particularly to small and medium sized enterprises, offering fixed line voice services, including line rental services, mobile voice and data services, information technology (IT), terrestrial dial-up and broadband Internet services, as well as mobile telephone hardware. Wholesale business segment offers a full suite of fixed-line voice services, including line rental services, mobile voice and data services, terrestrial dial-up and high speed broadband Internet services, and mobile telephone hardware. On August 3, 2010, People Telecommunications Pty Ltd, wholly owned subsidiary, acquired Bell Networks Voice ; Data Pty Ltd (Bell Networks).


Results Of Our Analysis


Find Our Valuations here

Notes about the Meeting

  1. We should look into Excel functions that automatically calculate an initial price from an final price & interest rate, instead of implementing an iterative solution (ALL);
  2. We should look into implementing checks to ensure our calculated growths are feasible. Possible things to include on checks are the current size of the sector (or whole economy), factored over 10 years for typical population growth & inflation. This needs to be dicsussed further if we are to come up with a workable check we all agree on (ALL);
  3. We should also look at whether or not a company has previously grown by acquisition. If this is the case, there may be a limit on future growth. We should flag this in future calculations, and should certainly be implemented in Point 2, above. (ALL)
  4. Roys should evaluate gearing as Gearing=Debt/Assets, which is preferable to my current system of years to pay off debt (ROY)
  5. Roy should include Interest Coverage Ratio (ROY)
  6. Roy shouldn't calcualate growth as an average value, but use at Growth Rate =(final  - initial)/No. years  (ROY)
  7. Roy should divide EBITDA by the net assets to evaluate the amount of assets in the business that are being used to generate profits (ROY)
  8. Next Meeting: Present analysus of IRI  & Discuss the assessment of many companies. (ALL)

Saturday, July 9, 2011

Meeting #37 Evaluating Cardno

Cardno 

"Cardno Limited is a provider of professional services in physical and social infrastructure. The Company has three business segments: Professional Services Australia and New Zealand, Professional Services Americas and Software, and International Development Assistance. Professional Services Australia and New Zealand provides consulting engineering, planning, surveying, landscape architecture, environmental services and geotechnical services. Professional Services Americas and Software provides services in the Americas and software sales globally. International Development Assistance manages aid projects on behalf of unilateral and multilateral government agencies and private clients."

is an interesting company with a soaring stock price

All our analysis can be found here

Thursday, June 2, 2011

Meeting #36 ARB Deep dive


We have previously analysed ARB and thought it was worthy of a second closer look. So our task for the next meeting is to really get under the hood with ARB and develop our understanding that we had from meeting 34

The Meeting
Attendees: Mark, Tom, Gilles and Paul

We basically confirmed our previous analysis that ARB is a stellar company. The question is this growth cannot continue like this forever. Priced at a 16 x multiple of earnings it is expensive compared to other engineering stocks. However it has shown extremely consistently high performance However we all do think it is a bit expensive right now we have bandied about prices of between 4.50 and 5.50

Analysis will be being put on the spreadsheet here

Next Meeting
We will be evaluating Cardno

Thursday, April 21, 2011

Meeting # 35 SDI Valuation


This meeting is due to occur in the future in May 2011 (see calendar above for exact date).

SDI is a company that operates in the research and development, manufacturing and marketing of dental restorative materials. SDI’s products include alloys, etchants, glass ionomers, sealants, cement, equipment, tooth whitening, composites. It operates in Australia, Europe, the United States and Brazil. The Company’s subsidiaries include SDI (North America), Inc, SDI Holdings Pty Ltd, Southern Dental Industries GmbH, SDI Brasil Industria e Comercio Ltda and SDI Dental Limited.

The share price has taken a hammering recently with the high price of silver and high Aussie dollar. At this time of wring the share price is 17 cents.

Discussion points prior to the meeting
In the last valuation we found some descepencies with what comsec claimed the debt levels were against what was in the annual report. For this valuation I did some cross verification and was supprised to see the cash in the annual report to be 875,000 but in comsec it was 3,406,000.

ThenI realized that the 3406 is for the consolidated entity not the company (we'll need to discuss this)


The Meeting
Attendees Paul, Mark, Justin, Tom and analysis was sent from Roy in the UK

Findings
As a value investment it was not good and the inconsistent earnings have made it a difficult company to value. Return on capital is also not good.

Click Here for our Valuations