Share Price Alert: Briscoe Group Ltd

BGR 10 Year Chart

Briscoe Group Ltd [BGR.NZX] had an excellent 4th quarter sales result out on Thursday and sales for that quarter were up by almost double digit levels and profit for the 2012 full year, which is out in March, is set to be up by around 25%.

Clearly this is significant news and had an immediate impact on the share price taking it from $1.42 pre announcement to $1.50. The share price gave back 5c today to close at $1.45.

While the current share price is at 4 year highs not seen since late 2007, the stock is still at an attractive yield of over 9% gross, the company has no debt and $60-70 million cash in the bank and having a profit upgrade while other retailers, like The Warehouse Group Ltd [WHS.NZX], are suffering downgrades surely makes this retailer an exceptional one and the best operated listed retailer in New Zealand.

You can see in the 10 year chart above that this has not been a stock to buy for capital appreciation, reaching a high of over $2.75 nearly 10 years ago and never reaching even close to that ever since but it is well off its 2009 lows of just under 60c, so you would be buying at close to 3 year highs.

There could be pressure in the coming year on BGR's margins from its desperate competition but as I said above it is in good shape and I would buy at these levels as a yield play.

Buy on weakness if possible.

Further Share Price Alerts 

Disc: I own BGR shares in the Share Investor Portfolio


Briscoe Group @ Share Investor

Share Investor's Total Returns: Briscoe Group Ltd
Chart of the Week: Briscoe Group Ltd
Share Investor Q & A: Briscoe Group CEO Rod Duke
Share Investor Q & A: Put Questions to Briscoe Group CEO Rod Duke
Long Term View: Briscoe Group Ltd
Briscoe's Cash worth looking at
Whats on Rod Duke's shopping list?
Why did you buy that stock? [Briscoe Group]
Rod Duke's Pumpkin Patch gets bigger

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Share Price Alert Series

The following are the full list of links for the Share Price Alert series of posts


Share Price Alert Series

Pumpkin Patch Ltd 5
Fisher & Paykel Healthcare Ltd
Contact Energy Ltd 6
Fletcher Building Ltd 5
Auckland International Airport Ltd
Kathmandu Holdings Ltd 2
Mainfreight Ltd 3
Fisher & Paykel Healthcare Ltd
Fletcher Building Ltd 4
Fletcher Building Ltd 3
Port of Tauranga Ltd 2
Contact Energy Ltd 5
Ecoya Ltd
Contact Energy Ltd 4
The Warehouse Group Ltd 2
Contact Energy Ltd 3
Contact Energy Ltd 2
Xero Ltd 2
Pumpkin Patch Ltd 4
Pumpkin Patch Ltd 3
Hallenstein Glasson Holdings Ltd
Telecom New Zealand Ltd 4
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 2
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




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Sky City Entertainment Group Ltd: Convention Centre may mean significant gaming expansion

Artists impression of the Sky City National Convention Centre

News out during the last few weeks that Sky City Entertainment Group Ltd [SKC.NZX] may have negotiated a large increase in the number of gaming machines, tables and other concessions in return for building and funding a National Convention Centre for New Zealand and allowing it to significantly expand its revenues at the Auckland casino is clearly great news for investors. New Zealanders are also set to gain a valuable new addition to the landscape in terms of returns for surrounding businesses and opportunities for the country as a whole.

Lets have a look at how great things might get for us long suffering shareholders.

First of all a couple of negatives. $350 million in shareholder funding will be needed to build the convention centre and ongoing costs will be significant. Convention centres, as a rule, do not make money on their own, they are generally used to bring in foot traffic to other parts of a business or town to push spending in those areas.

This is where the positives for the casino may bear some fruit.

At present the company is restricted by law as to expansion of its gaming business in Auckland and indeed the rest of New Zealand so it has thus far been lowering business costs, debt levels and building attractions like a dozen more eateries and other peripheral gaming stuff to grow revenue and profit and that has been very successful under CEO Nigel Morrison.

Businesses all need to continue to grow though and with the company asking the National Government to allow them to increase the number of gaming machines by up to 1000 and increase the number of table games even agreement for a 25% increase in gaming will clearly be significant for the Auckland site and for shareholders as the vast bulk of group revenue comes from this one site.

Any increase in gaming machines is not going to be politically acceptable to the left, so SKC management are going to find any increase politically tough to push through but I am confident there will be some increase in the levels of gaming at Sky City Auckland.

While building and funding a massive new building at a time of global financial uncertainty is a huge risk. The risk for shareholders is worth taking though given the stagnant nature of revenues at Auckland. Extra foot traffic would boost gaming revenues at the site regardless of a boost in machine numbers so lets hope management have got their modelling right when they factor in the cost of the capital expense, ongoing running costs and the level of extra gaming there has to be to get an acceptable return for shareholders.


Sky City Convention Centre @ Share Investor

VIDEO - Sky City Entertainment Group : Parliamentary Question related to Convention Centre
Sky City to pay for National Convention Centre
Share Investor discusses Convention Centre proposal with CEO Nigel Morrison
Sky City Convention Centre Expansion a Money Loser: Part Two
Sky City Convention Centre Expansion a Money loser
SKC Convention Centre power-point slide illustrations & SKC submission to Auckland City Council

Sky City Entertainment Group @ Share Investor

Share Investor's Total Returns: Sky City Entertainment Group Ltd
Sky City Entertainment Group Ltd: Presentation to Macquarie Group
Morningstar Revalues Sky City Entertainment Group
Guest Post - Michele Hewitson Interview: Nigel Morrison
Failed Sky City bid for Christchurch Casino good news for Shareholders
Sky City Entertainment Group Ltd: Christchurch Casino bid falls short of Investment Criteria
Sky City Entertainment Group Ltd: Never mind the width feel the volume
Sky City Annual Meeting & 2011 - 2012 Profit Forecast
Stock of the Week: Sky City Entertainment Group Ltd
Sky City set to lose National Convention Centre bid
Sky City Entertainment Group: Australian Acquisition on the Cards?
Sky City Entertainment Group Ltd: 2010 Full Year Profit Analysis
Sky City Entertainment Group 2010 Full Year Profit Preview
Chart of the Week: Sky City Entertainment Group Ltd
Share Investor discusses Convention Centre proposal with CEO Nigel Morrison
Share Investor Q & A: Sky City CEO, Nigel Morrison
Sky City Entertainment: CEO Nigel Morrison discusses 2010 HY
Sky City Convention Centre Expansion a Money Loser: Part Two
Sky City Convention Centre Expansion a Money loser
Sky City Entertainment Group Ltd: Download full Company analysis
Sky City 2010 full year profit looking good
Long Term View: Sky City Entertainment Group Ltd
Sky City Entertainment: CEO Nigel Morrison discusses 2010 Half Year
Sky City Entertainment Group 2010 Interim Profit Review
Sky City to focus on Gaming
Sky City debts levels now more manageable
Insider Trading on Sky City shares
Sky City Profit Upgrade: Always on the Cards
Sky City's Current Cinema "Boom" a Horror Story in Disguise
Stock of the Week: Sky City Entertainment Group
Are Insiders selling Sky City Stock?
Sky City Entertainment 2009 Interim Result Preamble
2008 Sky City profit analysis
Sky City share offer confusing and unfair for smaller shareholders
Sky City Entertainment 2008 Full Year profit results , NZX release, 2008 full year presentation, result briefing webcast, financial statements
Sky City 2008 profit preamble
Sky City outlines a clear future plan
As recession bites Sky City bites back
Sky City Assets: Buy, sell and hold
Why did you buy that stock? [Sky City Entertainment]
Sky City Share Volumes set tongues wagging
Sky City half year exceptional on cost cutting
NZX Press release: Sky City profit to HY end Dec 2007
Sky City Cinemas no Blockbuster
Sky City Entertainment share price drop
New Broom set to sweep
Sky City Management: Blind, deaf and numb
Sky City sale could be off
Opposition to takeover
Premium for control
Sky City receives takeover bid
Sky City Casino Full Year Profit to June 30 2007
Setting the record straight
Sky City CEO resigns
Sky City Casino: Under performing
Sky City Casino 2007 HY Profit(analysis)
Sky City Casino 2007 HY Profit


Discuss SKC @ Share Investor Forum
Download SKC Company Reports




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Facebook IPO: Should you "Like" it?

Just pondering the pandemonium over the highly anticipated Facebook Inc [FB.NASDAQ] IPO. (download the prospectus here)

There has been so much hype and interest whipped up by general mainstream media, online media and Facebook itself it is hard to know just what is hype and what is reality. Even U2's Bono is in on the action !!!! Cue bizarre looking smoky shades.

Well, Facebook is expected to file a preliminary prospectus for an IPO today and prospective investors will find out whether the hype matches reality and the value that Mark Zukerberg and his mates at FB central have put on the popular social networking site.

I don't have to tell you the littered corpses of hundreds of tech companies that were going to be "the next big thing" that have gone before Facebook and only just a handful of them still remain.

One of course is Google Inc [GOOG.NASDAQ]which debuted in 2004 and has been a moderate success since. Google though, had and still has strong revenue streams and their market share is such that they dominate just about every business sector that they operate in. They are pretty much a dominant monopoly cash cow.

Facebook, when listed, would, in actual fact, have to go after Google advertising revenue - and win - to have a decent shot at long-term success.

Both Facebook and Google operate businesses in the fast moving, ever changing technology sector where Google has thus far cemented their place on the internet as a business but Facebook, while dominant in the social networking arena, could be subject at any time to a new technology start-up that removes that dominance in a heartbeat. Anyone remember MySpace?

Facebook may well be one of the notable exceptions to the tech disasters the markets have seen since the late 1990s but it would be one of the rarities if it did.

By all accounts, market watchers expect the company to be way overvalued and that really is a symptom of the hype surrounding the IPO and the expended demand as a result of that hype rather than the fact it is a good business worth investing in. Overvaluing an IPO of a company with an unproven business model seems to me to be a recipe for disaster, for initial investors in the public pool anyway.

In a once over lightly of facts and figures leaked from Facebook back in 2009 it showed revenue of US$ $1.24 billion and net income of $355 million for 9 months in the 2009 financial year. It is unclear whether this revenue has increased over the years or how much of that income has been spent on keeping Facebook going and growing but the IPO could be one of those nasty grabs for cash that happened during the dotcom frenzy of the 90s and may need to happen again if FB is to continue to grow.

The big winners are going to be Mark Zukerberg and the rest of the early investors in Facebook who will be billionaires or multi millionaires when the company lists and early participants in the IPO.

I am clearly very cautious about the Facebook IPO and will not press the "Like" button just yet.

My comments above will suffice.

Related

Download Facebook SEC Filing - Prospectus
Google: Has it lived up to its Hype?


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Share Investor Portfolio 2: Value @ 31 January 2012

The Share Investor 2 Portfolio is a separate portfolio apart from the original Share Investor Portfolio and contains just one share, Contact Energy Ltd [CEN.NZX]. It will only have this one share in it and has a far shorter time frame than the original long-term portfolio that I started 8 years ago.

The portfolio was started July 7 with 9000 shares purchased at $5.34 at a total cost of $48,060.00 and $144.18 in brokerage.

After 7 months of trading the portfolio was down sharply in the first month of January 2012 by $7830.00 or 16.53% - its biggest ever fall - on the December 5 update to be worth a total of $43020.00

The portfolio is down by 8.43% since tracking began on July 7 2011.

Share Investor 2 Portfolio as at 17:30:00, Tuesday 31 January, 2012 (NZDT)
 

Stock		Quantity	Cost price	Total cost	Market price	Market value	Change	%
	CEN	202	$0.000	$0.00	$4.780	$965.56	$965.56
	CEN	8,798	$5.340	$46,981.32	$4.780	$42,054.44	$4,926.88	10.49%
8.43%   Total cost   Market value      Change $46,981.32    $43,020.00 $-3,961.32

Share Investor Portfolio 2

Share Investor Portfolio 2: Value @ 5 December 2011
Share Investor Portfolio 2: Value @ 28 November 2011
Share Investor Portfolio 2: Value @ 18 November 2011
Share Investor Portfolio 2: Value @ 11 November 2011
Share Investor Portfolio 2: Value @ 4 November 2011

See all previous updates here - Scroll down to bottom of post

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The Market says Rob Fyfe has failed

So the departing CEO of Air New Zealand Ltd [AIR.NZX] is leaving his post at the end of 2012 and being lauded by some as a  "rockstar" CEO and the saviour of an airline.

According to the market though he is not.

If we look at the 7 year chart below - the length of time Mr Fyfe has been with AIR NZ -.we can see that the share price has kamakazied to half the value it was when he took over in 2005.

7 Year AIR Chart

Not only that, the share price is an all-time low (see 10 year AIR chart below) since the company was injected with a billion taxpayer dollars in 2002. Hardly the stuff of first-class lay back and champagne flutes.

10 Year AIR Chart

Over its 10 year listing Air New Zealand has had negative returns for investors and the share price was markedly better under Sir Ralph Norris who managed the current structure of the company well through its formative years in the early 2000s.

I know airlines are notoriously difficult to run and it is hard for them to make money but the plaudits and pats on the back for him now are misplaced at best and arse kissing at worst.


AIR @ Share Investor

Share Price Alert: Air New Zealand Ltd
Queenstown Aiport Case: Air New Zealand VS Auckland
Queenstown Airport: Loud Voices & Loyalty
Long Term View: Air New Zealand Ltd
John Palmer Tipples on the Shareholder
Mike Pero and Air New Zealand: Capitalism vs Socialism
Rob Fyfe's "Environmental Extremism"
Reality Needs to Bite
Air New Zealand wants another taxpayer bailout

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Download AIR Company Reports

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