Union Homes

[SavyInvestor]

Hi Guys
Does anyone know if this stock is a good buy. Does it have solid fundamentals and potential for capital growth.

Thanks

[zainabusman]

Originally Posted by creflo

may be you havent seen their 3rd quarter earnings yet. I am not sure what you mean by "forward" PE but in any case , most quoted companies trade at PE of 40 thats a fair valuation on the secondary market. thats demand/supply usually push people to pay a max of about N40 for every N1 earned or dividend i should say. thats my average observation from extensive and continuous following of the Nigerian Stock exhange. from the facts i gathered from their quarterly earnings, Union homes is poised to earn between 60k and 80k for every outstanding share so I beliveve if they declare at least 40K they would not be trading at nothing less than N16 around august when they would declare these are conservative estimates. I know Nigerians like money magic as very few people are ready to wait for 3 or 4 months to make returns we want it sharp sharp but really thats how to build an enduring wealth. IF you are an adept investor, and every 6months you can do research and find a stock that would double in 6 months then with N1 million, you will need only 5 months to make N1 billion. try and compound it yourself. Capital market requires shrewdness, patience, indept knowledge (more than others) and willingness to take risk.
well before i digress this thread is for something else. Onward make una no annoy

Could you please publish the 3rd qtr earnings? My little research shows N1.4billion and they have 6.25 billion shares outstanding. This gives an EPS of 30k, so they cannot pay a dividend of 40k unless i am missing something.

Please publish the earnings and shareholders funds u used. thanks

[hispy99]

Originally Posted by creflo

may be you havent seen their 3rd quarter earnings yet. I am not sure what you mean by "forward" PE but in any case , most quoted companies trade at PE of 40 thats a fair valuation on the secondary market. thats demand/supply usually push people to pay a max of about N40 for every N1 earned or dividend i should say. thats my average observation from extensive and continuous following of the Nigerian Stock exhange. from the facts i gathered from their quarterly earnings, Union homes is poised to earn between 60k and 80k for every outstanding share so I beliveve if they declare at least 40K they would not be trading at nothing less than N16 around august when they would declare these are conservative estimates. I know Nigerians like money magic as very few people are ready to wait for 3 or 4 months to make returns we want it sharp sharp but really thats how to build an enduring wealth. IF you are an adept investor, and every 6months you can do research and find a stock that would double in 6 months then with N1 million, you will need only 5 months to make N1 billion. try and compound it yourself. Capital market requires shrewdness, patience, indept knowledge (more than others) and willingness to take risk.
well before i digress this thread is for something else. Onward make una no annoy

This is the 3Q results I have for Union Homes:

Union Homes Plc Turnover PBT TAX PAT
=N='000 =N='000 =N='000 =N='000
31-Dec-07 9 Mths 5,592,000 1,711,000 291,000 1,320,000
31-Dec-06 9 Mths 5,451,000 864,000 148,000 718,500
2.6% 98.0% 83.7%

They grew PAT by 83.7%, but turnover by only 2.6%. Just like Zainabusman, I also have an EPS of 29k, please let us know how you arrived at EPS of 60-80k. Except Union Homes can deliver N1.32B PAT for Q4 alone, there's is no way they will acheieve an EPS of 60k.

I do not agree that a PE of 40 is a fair valuation in the seconday market. Just because the market has been irrational letely does not mean that a PE of 40 is fair. If you have data that shows that the historical PE of the market has been 40, please share it here.

Finding a stock that will double every 6 months is easier said than done. UBA is one of the cheapest and most fundamentally sound stocks and it's price has gone no where in the last 4 months or so. It is one thing for you as an investor to find value in a stock, it is another thing for the market to agree with you. If the market does not see what you see, then that stock is not going anywhere.

[knightofdelta]

I got a forward EPS of 35K for March 2008 full year with linear projections from my own calculations.

As far as I am concerned Union Homes is not one of the best buys in the market. They were able to grow their turnover by only 2% and their ROE dropped from 0.86 to 0.68 based on their 3rd quarter results. Buying into Union Homes will be for the LONG term because it s a growth stock as the mortgage sector will take over the economy when the stock market has reached its peak.

Based on the results they have released so far, buying into Union Homes at this time is mere speculation for short term as there are no fundamentals to drive the share price up.

I'd rather buy more of UBA and Diamond bank.

[creflo]

okay You guys should post au many outstanding shares union homes has here. and please tell me where you got it or au you arrived at it. forget gramma ,shares is simple mathematics, unless i got the wrong number because i checked their market capitalization and the current price and thats au i arrived at my EPS. but may be my data was stale. but I realy would love to know the # of outstanding shares they have.

I just chcked and they have 2 billion outstanding shares and as at third quater results they have earned N 1,320,000 profit after tax, if they finish the year with a conservative N1.5 billion Profit after tax , is there Earning ratio not N1.5billion/2 billion outstanding shares that translates to 75K for every share. am missing something my people. all this throwing of acryonyms doesnt increase share price. its the fundamentals that does , and thats your earnings!! if a company declares 50K dividend tell me au they can be trading at less than N20.
for the guy that said predicting a share that can double in 6 months is not easy, its easy its just the limited fundamental knowledge of the market that make it easier. 6 months ago I just saw that Conoil was trading at N60 and I called my friend in Nigeria and said what was going on, why have you not bought all the conoil shares you can find. today the price is N138. people dont check these fundamentals if u do Union Homes will not elude you. Japaul is a good buy by the way.

[hispy99]

Zainabusman got it right, the # of oustanding shares is 6.25B

[creflo]

please update me on where you got that 6.25 billion shares may be the website i checked is stale.

[zainabusman]

Originally Posted by creflo

please update me on where you got that 6.25 billion shares may be the website i checked is stale.

I got the number of shares outstanding from the Nigerian stock exchange website. Here is the link.


http://www.nigerianstockexchange.com...symbol=UNHOMES

[chidiohaz]

I am confused lately about the impact of the 100,000 min. units of share that could drive the price of stock, this has affect most of my stocks. Virtually all my stocks are pointing southwards!

Please advise me before I go bunkers, do I offload my Union Homes Stocks now or do I shore up the more????

[olusolakemmy]

Originally Posted by chidiohaz

I am confused lately about the impact of the 100,000 min. units of share that could drive the price of stock, this has affect most of my stocks. Virtually all my stocks are pointing southwards!

Please advise me before I go bunkers, do I offload my Union Homes Stocks now or do I shore up the more????

the 100,000 minimum is to prevent share price manipulation.
it is a knowledge that some company sell 1000 unit daily and have 5% appreciation, this can persist for 4weeks, by the time the share price double, triple or quadriple, they will start selling the shares in millions!!!!!!!!!!!!!
a classical ways of defrauding the public.
take the case of roads plc for instance, since the regulation, the share price has stagnated at N4.09, before then it was moving 5% daily.
so in a way, i think it is a good regulation, what the regualtion means is that for a company to appreciate in price, there must a a considerable amount of demand for that stock
for your union homes, dnt know what to say.

[son5070]

Originally Posted by chidiohaz

I am confused lately about the impact of the 100,000 min. units of share that could drive the price of stock, this has affect most of my stocks. Virtually all my stocks are pointing southwards!

Please advise me before I go bunkers, do I offload my Union Homes Stocks now or do I shore up the more????

Union homes shouldn't much be affect by this rule,i mean they have just over 6b outstanding share and do trade volume.
Going Short-term,i can't see any news that will drive it price and also with rumours of impending PO....I don't see them going on suspension at its current price though.
All said,i will hold this stock for long term
NB- i don't have this stock for now(no money to buy)

[hispy99]

Union Homes pumps N60bn into housing in Africa’s first REIT


BusinessDay... the voice of business - Union Homes pumps N60bn into housing in Africa’s first REIT

[Avocado]

Not a bad result for Union Homes; not fantastic, but not disgraceful.

Roads is an excellent example of the unfairness and absurdity of the flat 100k-units rule. 100k is 0.5% of all Roads shares; compare with, say Union Homes, with 6.25B shares, that's 0.002%; or, better, with a Construction Industry stock: if 100k units should move Costain (0.06%), then about 15,000 units should do for Roads, even less.

Roads delivered a fantastic result for year end 2007. If Roads' F-PAT drops by 50%, the stock will still be ridiculously cheaply priced. In the absence of the one-cap-fits-all 100k rule, it wouldn't have been abnormal for Roads' price to have continued maximum daily gains straight for 20 trading days, starting from the freezed price of N4.09; and even then, the fundamentals will place the stock in lucrative PP range.
.

[hispy99]

Originally Posted by Avocado

Not a bad result for Union Homes; not fantastic, but not disgraceful.

Roads is an excellent example of the unfairness and absurdity of the flat 100k-units rule. 100k is 0.5% of all Roads shares; compare with, say Union Homes, with 6.25B shares, that's 0.002%; or, better, with a Construction Industry stock: if 100k units should move Costain (0.06%), then about 15,000 units should do for Roads, even less.

Roads delivered a fantastic result for year end 2007. If Roads' F-PAT drops by 50%, the stock will still be ridiculously cheaply priced. In the absence of the one-cap-fits-all 100k rule, it wouldn't have been abnormal for Roads' price to have continued maximum daily gains straight for 20 trading days, starting from the freezed price of N4.09; and even then, the fundamentals will place the stock in lucrative PP range.
.

The 100k rule in my opinion was a knee jerk reaction to the obvious price manipulation that was going on. It is because of this rule that some overpriced stocks cannot come down in price (Nigerian Enamelware for example).

[billions]

Proshare News and Analysis
Union Homes floats N50 billion REIT
Posted Tuesday, August 5, 2008

- forecast 350 Kobo DPU in 2011 FYE



Proshare NI

August 05, 2008 at 16:28 GMT







This is coming on the heels of the company’s Completion Board Meeting (CBM) held today in Lagos Nigeria.



In an Abridged Prospectus date August 05, 2008 and made available to Proshare NI, the Mortgage Company is raising the fund by way of offer for subscription and are authorised to receive 970,873,787 million units of N50.00 each at N51.50 Kobo per unit in the Union Homes REIT.



Forecast offer statistics as extracted from the Reporting Accountant’s report shows that Gross Earning is expected to grow from N3.324 billion in year one to N6.770 billion in year three; indicating a growth of 104 percent in the forecast period.



While Earnings per Unit (EPU) is also expected to increase from 166 Kobo in year one to 389 Kobo in year three representing an increase of 134 percent in the projected period.



Also Distributions per Unit (DPU) is expected to rise from 150 Kobo in year one to 350 Kobo in year three indicating a rise of 133 percent in the forecast period.



In the same vein, from the Profit Forecast for each years ending June 2009, 2010 and 2011 shows that income is expected to increase from N1.858 billion in year 2009 to N2.877 billion in year 2011 showing an increase of 55 percent in the forecast period



Earnings before Tax (EBT) is also expected to grow from N2.445 billion in year 2009 to N5.725 billion in year 2011 indicating a growth of 134 percent in the period under projection.



However, forecast for each of the years have been prepared on the assumption that the Trust will continue to operate on a basis consistent with the accounting policies to be prescribed and adopted by it.



The Abridged Prospectus affirms that the fund will be quoted on the Nigerian Stock Exchange (NSE). Union Homes REIT would invest a minimum of 90 percent of its assets in real estate and a maximum of 10 percent in quality real estate and mortgage assets.



The minimum subscription for the offer is 1,000 units and multiplies of 100 thereafter.



Financial Adviser/Lead Issuing House is Goldman Assets Management Limited; Joint Issuing House is Union Capital Markets Limited.



The Union Homes REIT offer opens on August 11 and Closes on September 17, 2008.

[hispy99]

Union Homes REIT to invest N18.75 billion in mortgages
Posted Wednesday, August 6, 2008

-To charge 12% rate annually

PETER OBIORA

Proshare NI

Augu