09-06-2014, 11:14 AM
On a macro basis, when global liquidity remains aplenty, it is difficult to come across sizable hard asst portfolio in a well regulated and transparent operating environment.
On a company level, Australand value is being endorsed by Stockland's pursuit. I am not saying Stockland has a good track record with their M&A pursuit historically. However, given that Australand's focus is their present forte, they should have a better feel of Australand's underlying value.
Given that Australand's exposure to commercial office assets in Australia is small (the most problematic sector), by default Australand is relatively clean. Moreover, with housing market "booming" on the eastern states (NSW, Vic), Australand has good success in their recent new launches and hence development profits may not have been adequately factored into the valuations. In addition, accumulating a sizable residential landbank Down Under over a diversified location and eventually bringing to market is a long process - can take at least 5 years for a starting launch to easily over 10 years for entire project to complete. I think this tedious process is not well appreciated by many to have a meaningful platform in Australia.
GG
On a company level, Australand value is being endorsed by Stockland's pursuit. I am not saying Stockland has a good track record with their M&A pursuit historically. However, given that Australand's focus is their present forte, they should have a better feel of Australand's underlying value.
Given that Australand's exposure to commercial office assets in Australia is small (the most problematic sector), by default Australand is relatively clean. Moreover, with housing market "booming" on the eastern states (NSW, Vic), Australand has good success in their recent new launches and hence development profits may not have been adequately factored into the valuations. In addition, accumulating a sizable residential landbank Down Under over a diversified location and eventually bringing to market is a long process - can take at least 5 years for a starting launch to easily over 10 years for entire project to complete. I think this tedious process is not well appreciated by many to have a meaningful platform in Australia.
GG
(09-06-2014, 10:56 AM)CityFarmer Wrote: [ -> ]We, who practicing value investing, are following closely a guideline of buying a dollar for 50 cents.
Will the guideline be any differently, if the dollar was sold for 30 cents recently? Well, it shouldn't make any difference, except reminding you to make sure the dollar worth really a dollar.
I am practicing the same for FCL's Australand acquisition. Instead of paying attention on why it was sold cheaper previously, I am trying to figure out why Australand worth the dollars paid.
(vested in FCL)