Share Price Alert: Telecom New Zealand Ltd 4

Telecom NZ Ltd [TEL.NZX] shares have had an amazing run over the last month or so and yesterday closed up 16c or 6.8% to finish trading at $2.435 on news that they were to receive the bulk of the contract for the Governments high speed internet rollout. The share price has taken off from $1.95 in mid April, a rise of almost 27% on yesterdays close.

With a share price not reached since the end of 2010 the stock still looks like getting overcooked to me and investors wishing to take a punt on anything that may come out of the fibre network rollout may want to temper their excitement because any additional revenue coming from it is many years away.

For the majority of the last year shares have been trading below 2 bucks and this is on 4 pieces of news out a month ago ( 1, 2, 3, 4 ) mostly related to taxpayer funded broadband.

The market is excited by the prospects for Telecom that subsidised broadband might bring but the payback for investment by the taxpayer and by the company itself is uncertain especially given the low speeds the company indicate their new fibre might bring and the restrictions and frustrations that will bring for customers as they realise they will not be able to do even a fraction of the things their mates overseas have been able to do for a decade or more already and that future speeds for global internet speeds (sans NZ) will be hundreds of times faster than ours.

Telecom as a company will have to be split into 2 separate companies, each presumably with its own NZX listing. Investors clearly see more value in the company as two seperate entities and see windfall profits if the company splits.

Market watchers though are ignoring the bungles the company has mismanaged with the introduction of new services and technology in the past so I remain skeptical of share price increases based on the possibility that the fibre roll-out will bear some positive fruit.

Until then performance for the company is likely to be more along the lines of weakening revenue, smaller profits and cost cutting.

The share probably has some more northwards trajectory to go based on overseas investors taking the news in overnight and the speculation may well propel the share well above current levels, especially as the split of the company will see investors have shares in two rather than one listed company.

Nice for short to medium term investors but long termers may want to wait for actual results from business created by the "new" Telecom.

Share Price Alert Series

Telecom New Zealand Ltd 3
Port of Tauranga Ltd
Freightways Ltd 3
Goodman Fielder Ltd 2
Freightways Ltd 2
Telecom New Zealand Ltd 2
Ryman Healthcare Ltd
Charlies Group Ltd
Fletcher Building Ltd 2
Contact Energy Ltd
Steel & Tube Ltd
Telecom New Zealand Ltd
New Zealand Stock Exchange Ltd
Mainfreight Ltd 2
The Warehouse Group Ltd
Pumpkin Patch Ltd
Hallenstein Glasson Holdings Ltd 2
Fletcher Building Ltd
Restaurant Brands Ltd
Mainfreight Ltd
Tourism Holdings
Goodman Fielder Ltd
Pumpkin Patch Ltd
Hallenstein Glasson Holdings Ltd
NZ Refining Ltd
Freightways Ltd
Xero Ltd

Telecom NZ @ Share Investor

Share Price Alert: Telecom New Zealand Ltd 2
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I was Wrong... sort of
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Download TEL Company Reports
Discuss TEL at Share Investor Forum - Register free


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Share Price Alert: Ryman Healthcare Ltd

Ryman Healthcare ltd [RYM.NZX] has had a good year results wise, with a 2010 half year profit up 25% on the comparable 2009 period. It has a long history of uninterrupted increasing profits and dividends.

While this success was reflected in the RYM stock price pre the 2008 stockmarket crash, post crash the stock reached as low as $1.12 at the beginning of 2009 on fears the property sector which had also crashed was going to impact on RYM - that was not to be. Since then the stock has pretty much risen unabated on a series of good profit results.

Yesterday the RYM stock price hit a 4 year intraday high of $2.57 and finished trading at $2.51 and is around 20c off its all time highs. The stock has put on nearly 10% in value since the end of March/ beginning of April and nearly 5% in just the last week.

Just to warn punters that the share price is at near high historical levels and while a positive 2011 Full Year profit out in May is probably the impetus for the rise, investors should be cautious at this fully priced company. While the historical growth levels may continue in the future, as they have for a decade or more and the share price may take a ride with it, it is worth backing off a bit if you already have your eyes on buying this company for the long term and buying on any weakness the share price may have.

Having said that results usually do the talking to the market and this could be the middle of a rise in share price that reflects the long term potential of this star NZX company.

Buy on weakness for excellent long-term gains.


Share Price Alert

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Fletcher Building Ltd 2
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Pumpkin Patch Ltd
Hallenstein Glasson Holdings Ltd 2
Fletcher Building Ltd
Restaurant Brands Ltd
Mainfreight Ltd
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Ryman Healthcare @ Share Investor

Ryman Healthcare Ltd: 2011 Half Year Profit Review
Gordon Macleod on Ryman Healthcare's Australian Expansion
Share Investor Q & A: Ryman Healthcare's CFO Gordon MacLeod
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Time for retirement?

Discuss RYM @ Share Investor Forum
Download RYM Company Reports


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c Share Investor 2011

Share Price Alert: Freightways Ltd 2

As you can tell from the 1 year Freightways Ltd [FRE.NZX] chart above the share price of the company hasn't moved much in the last year. The stock is well off $2.62c lows reached in July 2010 and has been an erratic beast for the last year.

Like most other NZX stocks over the last year it is up on more positive economic sentiment but the reason why I have included it in today's post is that the stock has put on almost 10% in value over the last 2 weeks. The stock has risen from just over 3 bucks to close at $3.28 yesterday.

This is on no material news at all in March but on a big spike in trading at the beginning of the month. Who was buying on that day I don't know but the stock has rallied over 8% post that trading day.

The positive result out in mid February had an impact on share price at the time but the share price drifted down through the first part of March.

$3.30 seems to be the price ceiling for this stock of late and I think investors might want to wait if they wanted to add this stock to the portfolio because it could come back as the economy bites again mid Winter on this bellweather company.

Buy on weakness.

Disc I own FRE shares in the Share Investor Portfolio


Share Price Alert

Contact Energy Ltd
Air New Zealand Ltd
Telecom New Zealand Ltd
New Zealand Stock Exchange Ltd
Mainfreight Ltd
The Warehouse Group Ltd
Pumpkin Patch Ltd
Hallenstein Glasson Holdings Ltd
Fletcher Building Ltd
Restaurant Brands Ltd
Mainfreight Ltd
Tourism Holdings
Goodman Fielder Ltd
Pumpkin Patch Ltd
Hallenstein Glasson Holdings Ltd
NZ Refining Ltd
Freightways Ltd
Xero Ltd


Freightways @ Share Investor

Freightways Ltd: 2011 Half Year Profit Commentary
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Discuss FRE @ Share Investor Forum
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Share Price Alert: Mainfreight Ltd 2

News that Mainfreight Ltd [MFT.NZX] has bought European logistics company Wim Bosman Group has, in logistical terms, sent the price of Mainfreight shares into destinations previously uncharted.

The share price almost hit the magical 9 buck mark, topping in intra trading today at $8.95 but finishing up 23c or 2.3% to close at an all-time high of $8.82.

The stock has risen almost 9% in two days since the news and by more than 10% over the last week.

MFT shares have risen by around 14% in 2011 and are off 52 week 2010 lows of $5.85.

The thing is, as good as the acquisition is for Mainfreight, and I believe it is a good move, the share price really has gotten away from the realities of the short term benefit for the company.

Long term the share price clearly should increase based on how well the new addition fits into the company and how much profit it makes but short term the market really has overreacted like Charlie Sheen in a room full of cocaine, hookers and the creator of Two and a Half Men.

If you are looking for the short term the share price must be close to a short term peak and long term best be patient, there are more tough times ahead that could hobble the stock in this good company.

Buy on weakness below 8 bucks.


Share Price Alert

The Warehouse Group Ltd
Pumpkin Patch Ltd
Hallenstein Glasson Holdings Ltd
Fletcher Building Ltd
Restaurant Brands Ltd
Mainfreight Ltd
Tourism Holdings
Goodman Fielder Ltd
Pumpkin Patch Ltd
Hallenstein Glasson Holdings Ltd
NZ Refining Ltd
Freightways Ltd
Xero Ltd



Mainfreight @ Share Investor

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Share Price Alert: Mainfreight Ltd

Mainfreight Ltd [MFT.NZX] is a stock you should be looking out for if you are a short termer and thinking of bailing.

It has added around $1.40 per share or 20% in a mere 3 months to close at $8.39 yesterday. Just a few cents short of an all-time high set last week. This is appears to be on the strength of a good 2011 1st half year where trading results were significantly higher than the previous comparable half.

Of course this increase was made on a particularly bad 2010 half year so we must take this into account when looking at the spectacular rise in the MFT share price.

My only conclusions for the rise are two-fold.

1: Investors have rediscovered the quality management of the company, especially the way they have managed the business over the last 3 very tough years.

2: The market is expecting a good rise in profit for the 3rd quarter, with the announcement coming out late Feb.

Either way though the momentum in share price built up over the last year where the swing has been from around $5.75 to present levels looks difficult to sustain given the absence of further positive news.

Look for a pull-back in share price if MFT disappoints the market in any way and consider locking in profits now if you are a short to medium term investor.

If you are a long-term investor you should wait for a pull back to enter this stock.


Disc I own MFT shares in the Share Investor Portfolio

Share Price Alert
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Xero Ltd


Mainfreight @ Share Investor

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Download Mainfreight Company Reports

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Share Price Alert: Tourism Holdings Ltd

The profit warning for Tourism Holdings Ltd [THL.NZX] out yesterday is par for the course for this company. It has a long history of overpromising and under-delivering then making excuses for doing so.

They are blaming natural disasters in this part of the world for a slow-down in bookings and also snow in Britain preventing people from booking holidays - I think they have the internet there don't they?

If you have invested in THL at higher prices I am sorry to hear that but don't expect results to consistently improve while current management are heading the operation.

Basically they suck!

This is why.

As I pointed out in July last year this company is so badly managed it is worth much more broken up than as a functioning company. Back then its net tangible asset backing was $1.37 per share and it was trading at about 75c per share. It now has an asset backing of $1.31 at 59c per share after dropping 20% yesterday on the bad news.

These are company valuations of their assets so you could probably remove a good 30c per share just to be safe in this climate of low prices for assets.

The kicker with the profit warning is that the company will be in breach of its banking covenants at the early part of this year, something that Bruce Sheppard pointed out was being risked mid 2009.

It is anyone's guess what might happen next but if the bank doesn't see the company improving in 2011 they could well be tempted to pull the plug.

In that case of course shareholders are well down the line of creditors.

If this doesn't happen the company could well be attractive to a buyer of all or part of the company's assets.

At 59c per share it maybe well worth a punt.

Having said that there will provably be more share price weakness as the company moves into the slower part of its business year during the Winter months.

Look to buy on a lower share price for an outside punt that could pay off well.

Not for the long term.


Share Price Alert

Goodman Fielder Ltd
Pumpkin Patch Ltd
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Tourism Holdings @ Share Investor

Tourism Holdings worth more broken up
Long Term View: Tourism Holdings Ltd
2011 World Cup Fever

Discuss THL @ Share Investor Forum






c Share Investor 2011

Share Price Alert: Goodman Fielder Ltd

Goodman Fielder Ltd [GFF.NZX] isn't what you would call a stellar stock in terms of underlying financial performance and returns to investors, there are better companies out there.

Having said that this stock has taken a significant hit in the last 3 months (see 12 month chart above) and is trading at more realistic valuations to the performance of the company.

The stock closed at $1.64 last Friday, a drop of nearly 40% on a November high of 2 bucks and a 52 week of $2.07 reached earlier in 2010.

At these price levels and current profitability, the stock is returning a solid gross dividend of over 8.5%.

Look to buy on further weakness if already on your radar for a good steady income.


Disclosure: I own GFF shares in the Share Investor Portfolio


Share Price Alert

Pumpkin Patch Ltd
Hallenstein Glasson Holdings Ltd
NZ Refining Ltd
Freightways Ltd
Xero Ltd


Goodman Fielder @ Share Investor

Long Term View: Goodman Fielder Ltd
Goodman Fielder turning on the DRIP
Goodman Fielder to improve bottom line in 2009
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Goodman Fielder hit by high commodity prices
Goodman Fielder a Hedge against an economic slump
Goodman Fielder pie gets bigger

Discuss GFF @ Share Investor Forum
Download GFF company Reports

Recommended Amazon Reading


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Share Price Alert: Pumpkin Patch Ltd

Pumpkin Patch Ltd [PPL.NZX] has been out with a profit downgrade this morning and this has seriously affected its share price, it has dropped by more than 9.5% or 15c at time of writing to be trading at $1.42.

There is an overall weakness in retailing stocks at present and just yesterday Hallenstein Glasson Holdings Ltd [HLG.NZX] came out with its own profit downgrade.

The Pumpkins profit levels have been up and down over the last 2-3 years after spending most of its listed life rising and the share price has reflected that.

Most recently it has taken hits from failed expansions into the UK and the USA but now its Australasian units have performed badly for the first time, indicating perhaps something more serious at play.

The company still lacks solid management but they have removed Greg Muir who cost the company millions through their failed expansion outlined above.

The company still has a core of loyal followers and a very strong brand and is well placed to ride out these tough times.

This is a good opportunity to buy on the way down.

I fear though there will be more bad news to come so be patient.


Disclosure: I own PPL shares in the Share Investor Portfolio


Share Price Alert

Hallenstein Glasson Holdings Ltd
NZ Refining Ltd
Freightways Ltd
Xero Ltd


Pumpkin Patch @ Share Investor

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Discuss PPL @ Share Investor Forum
Download PPL Company Reports

Buy Pumpkin Patch Clothing

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c Share Investor 2011

Share Price Alert: Hallenstein Glasson Holdings Ltd

Hallenstein Glasson Holdings Ltd [HLG.NZX] had a profit downgrade yesterday and they indicated that net profit after tax for the 6 months ended 1 February 2011 is projected to be in the range of $7.0 –$ 7.4 million, a decrease of 13% - 18% on the prior year ($8.549 million). Sales were marginally down indicating HLG was discounting to keep market share.

This comes on top of a pretty good FY 2010 result.

I was only questioning myself in September last year about whether I should sell or hold given that the shares were rocketing up and they peaked in November last year at $4.60.

The shares have been losing ground over the last few months before this announcement and they were down by 24c to $3.86 or almost 6% yesterday on low volumes traded.

It is a well managed company with excellent dividends and this bad news could be a good opportunity to pick some up as the stock price drifts south.

Buy on inevitable further weakness in the retail sector.


Disclosure: I own HLG shares in the Share Investor Portfolio


Share Price Alert

NZ Refining Ltd
Freightways Ltd
Xero Ltd


Hallenstein Glasson @ Share Investor

Hallenstein Glassons Ltd: Should I stay or should I Go?
Mixed Retail Outlook
Long Term View: Hallenstein Glasson Holdings Ltd
The History Of: Hallenstein Glasson Holdings Ltd
Hallenstein Guidance not indicative of wider retail recovery
Stock of the Week: Hallenstein Glasson
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Why did you buy that stock? [Hallenstein Glasson]

Discuss HLG @ Share Investor Forum

Download HLG Company Reports
Download HLG Company History




Think Bigger: How to Raise Your Expectations and Achieve Everything by Michael Hill 




c Share Investor 2011

Share Price Alert: Freightways Ltd

I don't pay much attention to this company share price wise. Freightways Ltd [FRE.NZX] has been the 3rd largest stock in terms of purchase price in the Share Investor Portfolio and I have simply held for the last 6 -7 years and collected the healthy dividends.

The share price reached lows of just above $2.60 mid 2010 (see 3 year chart below) and plumbed those depths once at the end of 2008 and then again midish 2009.




The share reached an all time high of just over $4.75 at the beginning of 2007 (see 5 year chart below) and since then has been up and down more regularly than Charlie Sheen in a Hollywood whorehouse.



Over the last 2 months though (see 3 month chart at top of post) the stock has added 39 cents to close at $3.29 today. This is an increase of about 14% and the share price has broken through a barrier of around $3.25 last attained in May 2010.

Either there is good news coming up in the coming 2011 Half Year profit announcement to be made in mid February or the market thinks the company is onto a better thing as people are perceiving the economy is going to do better in 2011.

If you have been looking at buying it might be wise to wait until after the result because I don't see that the company would have done well enough to justify such an improvement in share price.

Look for weakness post Feb.


Share Price Alert

Xero Ltd


Freightways @ Share Investor

Freightways Ltd: 2010 Full Year Profit Analysis
Long Term View: Freightways Ltd
Freightways Ltd: 2010 Half Year profit commentary
Freightways Ltd: 2009 Full Year profit commentary
Freightway's Capital Raising more of the same crap for small shareholders
Long VS Short: Freightways Ltd
Freightway's keeps delivering
Why did you but that stock: Freightways Ltd
Freightway's delivers
Freightway's packages up a good result

Discuss FRE @ Share Investor Forum
Download FRE company Reports

NEW - From Fishpond.co.nz | Think Bigger, By Michael Hill

Join the Share Investor Facebook Group

c Share Investor 2011