Forum Archive Index - December 1999

["Ben Dutton" <bendutton@sharechat.co.nz>]

Sorry Hugh,

But I have to disagree with the points you raise below.  I think comparing
the tech companies of today to Judge Corp and Equiticorp of the 1980s is
slightly misleading.  An understanding of the major issues behind technology
is vital.  For instance, how did you stumble across the ShareChat Forum?  By
using a computer (manufactured maybe by Dell, Compaq or Apple); an operating
system (Microsoft or Linux) and a browser (MSFT, Netscape <AOL>).

Perhaps you found ShareChat using a portal (Yahoo, Xtra from Telecom) and
were taken here courtesy of the routers and Internet infrastructure provided
by Cisco, Lucent and Compaq.

I use this as an example because many of the above companies are constantly
referred to as "overvalued" because of their high share prices.  I
personally believe that in some cases (for instance, Yahoo) this is true.
However, even if there was a large crash (or correction) on the Nasdaq
market (which would then lead on to similar corrections on world markets in
tech stocks) these companies will still be producing and supplying the
technologies of the future.  Nothing's going to change that.

Some NZ tech or e-commerce focused companies deserve the same recognition.
The information Baycorp (BCH) holds on New Zealanders, for instance, may be
more valuable than a piece of land in the middle of Auckland or
Christchurch.  Advantage's (ADV) edge in the field of e-commerce will enable
exponential growth as _every_ (that's right, every) business will be online
in the future.

Sure, there are some bad apples among the bunch, but that's the same within
any industry.

Of course, this is not to discount your view on Capital Properties, which as
you say is a very high yielding stock.  It is an excellent company that does
deserve a higher share price but I do think that property companies will
remain out of favour for a long time.  Focus will remain on companies that
make and market products for the future.

Tech stocks are only some of the many discussions on ShareChat.  Yesterday
was an exciting day with the Chrome Global listing (which more than tripled
on its opening price).  There are many value investors on the forum (check
out the archives) and there have been any number of interesting and
informative discussions on a whole variety of companies.

I myself am an admirer of Warren Buffet and his long term investing
principles.  However, he's had a rough past couple of years on the market,
because he's ignored all technology related stocks.

As for exchangesquare.com which you said you have joined - there are many
overseas chat rooms for investors which anyone can visit.  ShareChat is a
forum for New Zealand investors.

Best Regards,

Benjamin Dutton
Managing Director
ShareChat Limited


----- Original Message -----
From: hugh webber <hugh.webber@clear.net.nz>
To: <sharechat@sharechat.co.nz>
Sent: Saturday, December 18, 1999 10:10 AM
Subject: [sharechat] Capital properties error and this forum quality
discussed


> here is the text of the Cap Ppties statement which I have transcribed from
> today's Press....followed by some important issues.
>
> "Chch Press 18/12/99     Capital Properties Error
>
>
> Capital Properties has cut its October earnings forecast for its March
year
> by 4.8%, and by 14.6% for the following year, because of an error by its
> accountants, the company says.
>
> The need for the revision arose because of an error made by
> PricewaterhouseCoopers in the income flows of the financial model they had
> prepared for Capital Properties, the company said. The financial model had
> been prepared to enable Capital Properties to consider the financial
> outcome of its proposed takeover of Shortland  Properties.
>
> The $227 million takeover was almost completed, with compulsory
acquisition
> of remaining minority holdings imminent.
>
> Capital Properties, which warned last week of an impending revision, said
> earnings per share for 1999/2000 were forecast to be about 10.7c, against
> 11.24cps in an October notice of special meeting. In its prospectus for
its
> November 1998 float, earnings were forecast at 9.47cps for this year.
>
> For the 2000-2001 year earnings are cut from an October forecast of
> 14.87cps to a predicted 12.7cps.
>
> Although forecast earnings had been cut they were still 35% above the
> earnings forecast without taking the takeover into account, Capital
> Properties said."
>
> This raises a number of what should be interesting issues such as (a) are
> PricewaterhouseCoopers really that incompetent (b) what compensation can
> Cap Properties exact from them (c) what recourse do shareholders have who
> bought Cap Properties shares relying on the earnings data.
> (d) why is there such a deathly silence on these issues in the Sharechat
> Forum since I first raised it? people seem more interested in the latest
> successors to Judge Corp and Equiticorp than they are in the coy which
> apparently has the highest sustainable yield of any on the NZSE. If this
is
> symptomatic of this forum which I joined recently I think I ought to
> unsubscibe and find one more interested in Warren Buffett principles as
> explained in Mary Buffett's Buffetology.
>
>
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