Mortgage Choice (MOC) Time to buy ?, page-2

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daicosisgod

14,883 Posts.

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13/12/18

21:42

Post #: 36853507
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Originally posted by noomxx ↑

In my opinion now is the time to strike on MOC and buy.
$14m npat equals around 11c eps.

MOC is a great little company, it's capital light which allows it to pay out most of its earnings as dividends.

The company is one of few on the asx that has no debt. so there is little risk of business liquidation risk of difficult trading conditions continue.

a historical review of its ROE is high, suggesting a good underlying business, especially as there is no debt to inflate the E in ROE.

they have recalibrated the franchise model more in favour of franchisees. So this step down in profit to MOC is already factored into current profit forecasts.

the residential industry might well have a slow down, but the underlying business will not disappear or become obsolete.

the big 4 have explicitly endorsed the mortgage broking business. it efficient for them.

the one risk is the royal commission and payment of commission.

The season has arrived and it's time to buy before the sun comes out and the future price is much higher.

I have taken a reasonable position equal to 3% of the portfolio.

expected fy19 dividends near 9-10% fully franked

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The current slowdown will pass. Population growth will continue, the home loan processing backlog will eventually catch up especially when new borrowers learn the new rules of the game in relation to applications and verifying living expenses and repayment affordability. Australian’s deeply held desire to own real estate will never wane.

MOC will recover eventually.

MOC Price at posting: $1.11 Sentiment: Buy Disclosure: Held
2 Upvote

0 Great analysis

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Mortgage Choice (MOC) Time to buy ?, page-2

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