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

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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

Ministry of Silly Walks

You may have heard or seen the Monty Python Sketch "Ministry of Silly Walks".

It is of course comedy and lampoons politicians and bureaucrats.

Well little did you know is that in NZ we have a commissioner of silly walks. He would command northwards of $200,000.00 and said this about a $11,000.00 "fact finding" tour overseas to see how other people walked.

"That's what you get from talking to individuals ... you can read their annual reports, which I did, but it doesn't give you the personal views and feelings of where things are at, the soft information and that's been very helpful"

Apart form the fact that there shouldn't be a ministry of silly walks has Mark Neeson not heard of the telephone?

New Zealand has countless numbers of these drop kick commissions, most of which you would have you rolling your eyeballs over the nonsense of them.

They all have heads making serious six figure incomes and also staff, offices and the attendant expenses.

Mr Neeson seems to take it all in his stride though.

Perhaps if we all developed silly walks with the help of a taxpayer grant we might be able to forget a particular recession we are having, which isn't that funny at all.

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

c Darren Rickard 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

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Goodman Fielder @ Share Investor

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Discuss GFF @ Share Investor Forum
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c Share Investor 2011

Labour Set to Buy 2011 Election

Why is it every time I think of Labour and their policies for the 2011 Election the Abba song "Gimme, Gimmie, Gimmie" goes swirling around in my head like a nightmare from earlier elections they have fought.

It can be explained in the following way.

Every policy and indication of policy from Labour has thus far shown the electorate that Labour are set to try and bribe their way into power in November 2011.

It is all about taking from some to give free stuff to others and is a clear extension of policy that flourished under the party during Helen Clark's reign.

Extra holidays, extended working for families, higher subsidies for childcare and a host of other handouts already announced and no doubt more to come cement Phil Goff's former leaders lead in these kind of policies.

It seems to have passed Phil Goff and his fellow Robin Hoods by that we are in the midst of one of the biggest financial recessions the world has seen and he wants to compound the affects of it by higher taxes and higher debt because he wants to spend recklessly to buy votes.

One would have thought that he might have taken some notice that during the 9 years this country suffered under Labour, from 1999-2008, that these policies don't work and in fact contributed to the dire situation we now find ourselves in.

As bad are things are now, at least we have a reasonably fiscally conservative Govt with vast economic experience at the top. The alternative is a tax and spend regime that will lead us down the garden path, past Goff's barbeque to financial ruin.

Lets go past our greed and ask what we can sacrifice rather than what we can take and cant afford, from others.

Most traditional Labour supporters like myself were hoping to see a return to the older style Labour that looked after the worker rather than the bludger and we then would have considered switching our votes from National back home where our hearts lay.

But we simply cant afford another Labour term at this time, fiscally, morally and socially and we must vote for the good of our country and not ourselves.

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

c Darren Rickard 2011