Registered Members Login:
   
Forgotten Your Details? Click Here To Recover +
Welcome To The ShareCafe Community - Talk Shares And Take Stock With Smart Investors - New Here? Click To Register >

5 Pages (Click to Jump) V  < 1 2 3 4 5 >   
 
  
Reply to this topic

EHE, ESTIA HEALTH LTD
early birds
post Posted: Dec 13 2016, 11:14 AM
  Quote Post


Posts: 12,432
Thanks: 1362


Troubled aged care operator Estia Health saw its share price briefly plunge and analysts reduce their price targets for the company a day after announcing a highly-dilutive capital raising.

Trading was volatile but at one point the stock dropped as much as 7.3 per cent this morning. It was recently trading at around $2.52 a share, down only 1 per cent.

The company announced on Monday that it would raise $137 million in a deeply discounted share offer and would drop its interim dividend.

The aged care industry has been under pressure due to government funding cuts but Estia has also twice downgraded its earnings outlook. The company's founder Peter Arvanitis and other key staff including a previous chief executive left the company.

Estia has also come under close scrutiny because its debt has approached its bank borrowing facility.

Morgan Stanley issued a note to clients on Monday night saying it had reduced its price target on Estia to $2.10 from $2.50, while Bank of America Merrill Lynch said it was reducing its price target to $2.00 from $2.50.

CLSA went further reducing its price target on Estia to $1.90, down from $2.56. The analysts said they were concerned about management's ability to forecast the company's financial performance.

"While there may be potential upside on a longer-term view, we worry about Estia's historical lack of ability to forecast earnings," the analyst said.

Occupancy of Estia's 5700 aged care places was also under scrutiny.

"We believe "underlying Ebitda guidance of $86-90 million" is predicated on average occupancy of 93.7 per cent versus its actual occupancy of 92.8 per cent. This implies 2nd half fiscal 2017 occupancy will need to be above 94.6 per cent, which may be a stretch as Estia has not delivered this in the past."

Estia has hired Macquarie Capital to conduct a strategic review of its business. The review resulted in the company's chairman Pat Grier also being replaced by Dr Gary Weiss.
=================

but stock price is 2.50ish at moment. thought it should trade at 2.20ish. surprised me.



 
early birds
post Posted: Dec 12 2016, 09:42 AM
  Quote Post


Posts: 12,432
Thanks: 1362


Estia is undertaking an underwritten $136.8 million equity raising to reduce core debt
• Estia has concluded that in the current operating environment its optimal maximum leverage position should be in
the range of 1.5x - 1.8x EBITDA and therefore is undertaking the following initiatives to facilitate a reduction in core
debt over the medium term:
• An underwritten $136.8 million non-renounceable entitlement offer of 1 New Share for every 3 existing shares at an
offer price of $2.10 (‘Entitlement Offer’)
• No interim dividend to be paid in March 2017 in respect of the first half of FY17
• Thereafter, the expectation is that Estia’s dividend policy will be to pay at least 70% of net profit after tax for the period
to which the dividend relates1
• Proceeds from the Entitlement Offer will be used to reduce core debt by ~$131.0 million and pay transaction costs of
~$5.8 million
• The equity raising announced today will allow Estia to:
• Reduce leverage in the business to within revised target levels
• Operate at all times within its revised lower leverage guidelines
• Continue to pursue Estia’s preferred business strategy, including greenfield and brownfield development pipeline and
significant refurbishment, over the period to the end of FY18 and beyond
• Operate with a management team focused on optimising core business
==============

2.1 eh?? and 1 for 3 -----big dilute for existing share holder if one decide not to get new share.
still scratch my head as to why the heck someone willing to 7---8 bucks not long ago?? devilsmiley.gif unsure.gif



 
early birds
post Posted: Dec 7 2016, 09:28 AM
  Quote Post


Posts: 12,432
Thanks: 1362


In Reply To: nipper's post @ Dec 6 2016, 08:54 PM

i've been eye on this sector for a while by now nipper.
reason is the sudden jump up of life expediency around world, also the money printing by central banks around world that created housing booming that made most of oldies a lot richer
so they can afford the good age care facilities to have their nice last stage of life.

before this sector is too rich in PE for me--[EHE at 7--8 bucks}
now seems it swing to the other way.
i still see the good growth in this sector and this sector is near if not at bargain basement. imho. just have to figure it the "ok" management team. { too many crookers in this sector}
hope you can help me out a bit nipper!! tongue.gif




Said 'Thanks' for this post: nipper  
 
nipper
post Posted: Dec 6 2016, 08:54 PM
  Quote Post


Posts: 6,174
Thanks: 2191


In Reply To: early birds's post @ Dec 6 2016, 08:40 PM

not sure why you are fishing in this pond. To me, too many uncontrollable variables.... and with only really margin plus business models. I know the demographics are good, but sometimes 'govt money + property' attracts spivs. And it's hard work; got to be at it day after day. More the playthings of fund managers.

But, but, it is where we will end up, and the decision making process of residents/ families becomes "whatever it takes" (guilt, expediency, urgency) means the sector is solid. But does consolidation/ streamlining of process deliver upside?



--------------------
"Every long-term security is nothing more than a claim on some expected future stream of cash that will be delivered into the hands of investors over time. For a given stream of expected future cash payments, the higher the price investors pay today for that stream of cash, the lower the long-term return they will achieve on their investment over time." - Dr John Hussman

"If I had even the slightest grasp upon my own faculties, I would not make essays, I would make decisions." ― Michel de Montaigne

Said 'Thanks' for this post: early birds  
 
early birds
post Posted: Dec 6 2016, 08:40 PM
  Quote Post


Posts: 12,432
Thanks: 1362


In Reply To: nipper's post @ Dec 6 2016, 06:15 PM

really appreciated nipper. tongue.gif

freak this market---AFR is out before market opens. and EHE dropped through 2.50 at one stage in the morning. start at noon it just keeps up and up with stiles fashion.
try to dig something out of it, but seems asked wrong source. weirdsmiley.gif

still eye on this sector, just can't find something that makes me comfortable with at moment-----like swim in the mucky water..... puke.gif



 
nipper
post Posted: Dec 6 2016, 06:15 PM
  Quote Post


Posts: 6,174
Thanks: 2191


In Reply To: early birds's post @ Dec 6 2016, 05:56 PM

QUOTE
Assistant Minister for Health and Aged Care Ken Wyatt ... told a conference that changes to the Aged Care Funding Instrument (ACFI) that were announced in the 2016 budget were to be replaced with new cost-saving measures. The decision was taken by the expenditure review committee and comes ahead of the planned changes coming into effect on January 1, 2017.
AFR
...instead of adjustments to the way some ACFI payments related to pain management and physiotherapy were calculated, making them more difficult to obtain, there would be a one-year freeze on indexation of ACFI and in the following year a 50 per cent freeze on the added payment for high care patients.

https://agedcare.health.gov.au/sites/g/file...anuary_2017.pdf

One fund manager analyst noted that the change allowed the government to successfully cut costs in a way that did not target high ACFI claiming operators. The move may anger some in the non-profit aged care sector, who pointed the finger at private operators for "gaming" the system.





--------------------
"Every long-term security is nothing more than a claim on some expected future stream of cash that will be delivered into the hands of investors over time. For a given stream of expected future cash payments, the higher the price investors pay today for that stream of cash, the lower the long-term return they will achieve on their investment over time." - Dr John Hussman

"If I had even the slightest grasp upon my own faculties, I would not make essays, I would make decisions." ― Michel de Montaigne

Said 'Thanks' for this post: early birds  
 


early birds
post Posted: Dec 6 2016, 05:56 PM
  Quote Post


Posts: 12,432
Thanks: 1362


In Reply To: nipper's post @ Dec 6 2016, 12:08 PM

thanks nipper for the info.

i try really hard to dig , but can't find any prop info as to why the heck EHE finished 10% up??? unsure.gif

need your help or anyone who can feed here.



 
nipper
post Posted: Dec 6 2016, 12:08 PM
  Quote Post


Posts: 6,174
Thanks: 2191


In Reply To: early birds's post @ Dec 6 2016, 11:54 AM

saw something about debt ceiling being approached ... and the soothing Announcements not fooling anyone.

One of the issues is that capital management is imperiled by a change from full deposit to a staggered amount, for new clients (inmates, tenants, customers?) - the issue of Refundable Accommodation Deposits (100% upfront - nice little earner). As residents pass away, EHE and others must pay back the Residential Accommodation Deposit (on average $371,000); more incoming clients are choosing instead to keep the lump sum and make Daily Accommodation Payments of $65.

also the removal of a Liquidity Management Policy from the website - never a good sign



--------------------
"Every long-term security is nothing more than a claim on some expected future stream of cash that will be delivered into the hands of investors over time. For a given stream of expected future cash payments, the higher the price investors pay today for that stream of cash, the lower the long-term return they will achieve on their investment over time." - Dr John Hussman

"If I had even the slightest grasp upon my own faculties, I would not make essays, I would make decisions." ― Michel de Montaigne

Said 'Thanks' for this post: early birds  
 
early birds
post Posted: Dec 6 2016, 11:54 AM
  Quote Post


Posts: 12,432
Thanks: 1362


In Reply To: nipper's post @ Dec 6 2016, 11:44 AM

where will the sp find support nipper?? i took the loss on this one few days before{ guilty myself that i didn't take the profit when it hit $3.00 plus week before}
seems the sell off is caused by EHE board won't tell market that they have plain to raise fund by issue more shares.
somewhere 2.20ish nipper??



 
nipper
post Posted: Dec 6 2016, 11:44 AM
  Quote Post


Posts: 6,174
Thanks: 2191


the sell-off for EHE continues.



--------------------
"Every long-term security is nothing more than a claim on some expected future stream of cash that will be delivered into the hands of investors over time. For a given stream of expected future cash payments, the higher the price investors pay today for that stream of cash, the lower the long-term return they will achieve on their investment over time." - Dr John Hussman

"If I had even the slightest grasp upon my own faculties, I would not make essays, I would make decisions." ― Michel de Montaigne
 
 


5 Pages (Click to Jump) V  < 1 2 3 4 5 >

Back To Top Of Page
Reply to this topic


You agree through the use of ShareCafe, that you understand and accept the TERMS OF USE.


TERMS OF USE  -  CONTACT ADMIN  -  ADVERTISING