ASX Shares McGrath shares down 31% (MEA)

McGrath shares crash after resuming trading | smh.com.au

Ouch!

Interesting article, cites some numbers in the decline in listings in specific areas in Sydney, where McGrath real estate agencies typically operate.

 

And now he's being called a Spruiker in media.

 

Share price of his business has gone down in value not because of news about houses prices. His competing in a industry that is so competitive but for a real estate business he carries allow of debt as well.

 

A fool and his money are soon parted

 

You would expect "Mr Real Estate" after 30 years in the game, to know how the market rides, and arrange the listing of his company earlier in the cycle.

 

The man is long term bullish on his company considering he acquired 430k of shares last month.

 

It is not a service he can really monopolize - even in Sydney. As a seller would you choose them to sell your property now knowing it is public company with a depressed share price? Or would you choose another local option with a more traditional model? Yes the answer is who will get best price in the shortest time with minimal fuss, but all these issues must be hurting morale in the company too surely.

 

so is it a good time to buy perhaps???

 

I daresay the company listing was timed to occur at the peak of the market, when all the serious profits had already been made for its private investors and a downturn in the property market / company's revenue was imminent.

I wouldn't buy shares in the company anytime soon given the Sydney property market looks like its only just commenced its downturn. I think it's highly likely there will be more revenue downgrades in the near future for McGrath.

Best time to buy the shares is when Property Chat turns bullish on Sydney property again

 

Didn't he time it perfectly? Take all the profits on the way up, then sell just prior to the slowdown. In another year or so he will be able to take it private again and make a profit overall.

 

He just bought a bunch of shares recently so he is down at least 30% on his latest buy back.

 

That tells you what is happening in the Sydney market......should get interesting....

 

McGrath Earning Downgrade – Cannery in the coal mine

Just read that it is interesting McGrath said slowdown due to lower volume business in North Shore markets. While auction clearance rate shows those areas are better than other areas in Sydney. Something is amiss.

 

Tis the beginning:

Chinese developer Chiwayland to flip Parramatta site
Payce buys Sydney Melrose Park site from Aqualand for $160m
Sydney Northern, North Western suburbs set for price correction

 

Yep........lots have jumped in...they will feel pain shortly....

 

Hhmmm... maybe clearance rates are up but sales deal-sizes are down? Methinks the 'old money' of the north shore's 'big houses on large blocks' aren't selling and maybe it is more the units and little villas being traded instead?

 

McGrath and Co are buying more to average the price down:
John McGrath backs his business with share buy

 

Yep...the canary just fell off its perch...if the miners have not got out by now....they are in for some interesting times.

Rentals in parts of Sydney are dropping...another sign...pull backs and other factors are clear sign. Of course some people will bury their head in the sand and point to auction clearances...this is the lagging indicator.

 

Makes you wonder why he didn't invest more initially to his company, but when the price tanks he load ups... bought 930k worth over the last 4 weeks now.

 

Hi Nick,

John McGrath had a circa 37 Million payday from the IPO as he sold down. He did okay and now he's buying in at a discount.

Not sure if the following link will open for everyone as it's AFR and sometimes the pay-wall intervenes

John McGrath float flops as share price sinks below IPO price