Forum Archive Index - September 2002

["tennyson@caverock.net.nz" <tennyson@caverock.net.nz>]

Hi Nick,
 
> 
>It does look like the major indices could fall further yet, is this
>finally going to catch up with the NZSE. What is everyone thinking
>about this? 
>
>

Well I can't speak for everyone but....

>
>
>This IS a good time to consider locking in some profits
>and protecting your capital. Have a glance at Briscoes, Wrightsons,
>Sky City, and Fisher and Paykel. These cannot maintain their
>meteoric rise. 
>

If they are still 'value', then of course they can maintain current 
price levels.

>
>It just doesn't happen, if you like money, take some
>profits, even if you love the stock, why not sell it 
>and buy it back cheaper. 
> 

Because you might not be able to buy it back cheaper?


I'll pass on Briscoes.  Wrightsons are still on a yield of some 12%.  
According to management they think they can sustain that.  These sort 
of returns are way better than you can get at the bank.  I can't see 
much downside over the next 12 months.

Sky City Entertainment Group are on something like a 7% yield:  
Adelaide Casino improving, Hamilton and the Auckland Convention 
Centre coming on stream, America's Cup tourism bubble set to descend 
on Auckland.  Again I can't think of any reason to sell.

I don't follow F&P closely, but I understand particularly their US 
strategy is getting some traction.  And they are receiving premium 
prices for their premium products which are a niche item over there.  
A stock broker convinced an elderly relative to buy into them 
recently as part of a conservative portfolio.



>
> 
>Then consider Carter Holt, 
>
>


Selling way below asset backing and possibly a major beneficiary of 
the GPG lead reconstruction of the NZ forestry industry.  I can't 
produce a case to sell that.


>
>and Warehouse, 
>


Result out this week I think.  Future direction will depend on how 
the expansion into Australia goes.   Cheap if you think they can 
maintain their historical growth rate.


>
>of these are sitting nicely on long term trends, a drop now could
>mean a good reason to sell, a move up would be a good time to buy. 
> 


...if you follow momentum investing.  If you look at value 
investing the conclusions might be the opposite.

SNOOPY

disc: Hold WRI, SKC, CAH.   Not tempted to sell at anywhere near the 
current prices.


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