Sequoia Financial Group Limited

ASX:SEQ

Sequoia Financial Group Limited

ASX:SEQ
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$0.380 (+2.7%)
Last close price
#222
Rank
5
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22
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Forum Topics SEQ SEQ Financials

Pinned straw:
Mujo
Last edited 4 months ago

$50M Market Cap, $16M Cash, $5M in investments.

$8.6M in operating profit - including equity accounted investments.

Ongoing gross Divi yield (excl. special) of about 16%.

So many warts but so cheap.

Dominator
Added 4 weeks ago

Had another look this week at the AGM presentation. Given the numbers from the presentation (attached below). Sequoia is starting to look very cheap. The revenue growth in the core part of the business looks good.

Looks like management is divesting and focusing on core business (which they should have done in the first place), however, given the history I think new management is required and is holding me back from having enough conviction to buy again.

@Mujo or any other holders getting tempted at this price/thoughts on management?


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5
Mujo
Added 4 weeks ago

I’m quite tempted again. I have traded it quite successfully around dividends and i am considering it.

I did come across a client involved with a sequoia licensee where i think the adviser may have broken the law with cold calling and not meeting best interest obligations.

I just feel there are parts of sequoia that could face some significant legal action. So again cheap but a lot of warts.

The industry has cleaned up a lot and i think most of the dodgy now happens with industry super funds that were for politics reasons excluded from the royal comission so gives some comfort it may not be happening today.

6
Mujo
Added 3 weeks ago

Looks like this may be getting attention - Interprac is licensed through sequoia i believe.

Shield Master Fund investigation has ASIC worried about adviser 'professional judgement' | The Inside Adviser

"Earlier in the discussion, Kirkland (pictured) highlighted ASIC’s recent investigation into the Shield Master Fund, a high-risk fund it says consumers were pushed into via “cold-calling, lead generation, financial advice, and the potential mismanagement of investor funds through the potential role of platforms”. Keystone Asset Management has been named as the Responsible Entity being involved, while Macquarie and Equity Trustees have also been brought before the courts for their role in facilitating the transfers."

ASIC says it is aware advisers from four licensees have recommended clients invest in the Shield fund: InterPrac Financial Planning, MWL Financial Services, Financial Services Group Australia and Next Generation Advice. While no allegations of financial misconduct have been made yet, Kirkland made it clear the role of advisers in these types of cases is a concern for the regulator.

“We understand that over a two-year period more than $480 million was invested in this fund by thousands of people,” he explained. “Potential investors were called by telemarketers, who then referred them to financial advisers. They were advised to roll over from their existing superannuation funds and to put part or all of their superannuation into the Shield Master Fund.

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Dominator
Added 4 months ago

As a previous Sequoia shareholder the revenue numbers look good but real profitability isn't as great as "Operating Profit". For a CEO that loved to quote that he was a fan of Warren Buffett in the past, Gary really seems to love using "bullshit earnings" as Charlie would say. "Operating Profit" = "normalised EBITDA excluding non-operating items" is a real stretch of actual profitability!

My guess of real profitability would be about $3.6m based on operating cash flows then paying tax (net interest and lease payments cancel each other out). Really simple but can't see any other way to get a true read given the Morrisons sale during the year.

The Morrisons sale was fantastic deal by management. Probably the only highlight since I sold out. However, the constant purchasing of tiny businesses over the past few years can't have been easy to continually integrate without disrupting normal business. Just look at the Sharecafe mess... I'll be out till I see a management change....



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