Thorn Group (TGA)

finicky

finicky

Well-Known Member
Silver Stacker
Posted mainly to assuage my need to post on stocks. Has good quality earnings and nice dividend yield (over 7% franked). Company has retreated from small amount loans to individuals and has offloaded its debt collection business to lame old CCP. Will focus on stronger consumer leasing and business financing businesses. Doesn't seem to fear outcome of government enquiry into wider consumer credit practices.

Have commented on TGA here:
http://forums.silverstackers.com/topic-55431-a-few-top-dividend-stocks.html

The chart seems to have come off a bottom. The daily shows a full candle break above cup & handle pattern.
Weekly has moved out of its downtrend. Higher high following a higher low.

TGA daily
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TGA weekly
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Just the daily chart, but chart still strengthening. Price is above all daily moving averages, 20 dma has crossed 50 dma which is rising. Gap down from April filled. Could pull back, but still look good. The sentiment has turned for TGA. Trailing franked dividend yield of 6.5%

Disclosure: holding
Sentiment: hold

TGA Daily
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Added 2,000 of these @ 1.19 a week ago. Trusting that Thorn management has now accounted for its 'misdemeanours' with ASIC.
Additionally, that the test case for consumer leasing class action won't succeed enough to make an impact - Maurice Blackburn beat up. TGA Good yield payer when its sailing.

Sentiment: Not recommending because uncertainity over liabilities.

TGA mthly.gif
 
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Cheap? Could be, for me it's a quality spec. Quality based on more historical performance that is, not recent performance.
As a holder I'm ok with the slashed dividend, as I accept it is prudent provision against asic fines and customer remediation costs. Rightly or wrongly, I have assumed the broken dividend is temporary and in a couple of years I hope to be getting a good yield on my buy price. I'm a bit heavy into TGA so have not added at prices lower than my last buy @ 1.19
Obviously I jumped the gun with my last buy as I liked the signs of the weekly and monthly charts which have now been undone on the weekly. Waiting for confirmation of a reversal would have been a better way to go. Greedy and fomo. I very much doubt TGA falls into the best 10 buys on the asx currently.

Thorn Group (TGA) weekly
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Splat
TGA's fy ends 31 Mar.
Has updated on profit guidance for fy18. Expects npat $17-20m
At half-way that would be $18.5m, or eps of 11.7c, which might translate to p/e = 7.7 at current bid of around 90c
Dividend yield of about 6 - 7% franked for 6c paid.

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The announcement today summary - we told you it was going to be bad, it is, and we are not sure when it is going to improve. Market markdown appropriately.

Look to me unlikely the price decline is over yet.
 
It's only money. Anyway holding a bit of gold will make it all right in the end.
Everyone likes to glibly trash Motley Fool, but their Share advisor stocks list is up 58%, total returns, against the All Ords TR being up 24% over the same periods. Think you can beat that? Share Advisor tipped Integrated Research (IRI) at 38c six years ago. Tipped Corporate Travel Mgt (CTD) at 2.18 five years ago. They haven't reversed their buy rec on Thorn Group yet.
 
They got lucky with a few picks 5 years ago since then have been woeful. Go on about building wealth through dividend stocks and many of their recent picks have had dividends slashed and 30 to 40 per cent capital losses. Also they said to buy Bellamys at $15 when A2 Milk was in low $2 but they described BAL as "better value".
 
Yet they had it in their Best Buys a few months ago.... A sell rating would have been handy before today's 20 per cent hair cut.
 
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