The School holiday effect: Consistant January drop in Female Part Time Work

Just been looking at one of my favourite ABS releases, the detailed Labour force stats...a veritable treasure trove of info on Australian work habits and demographics.

One thing I have been looking at is Part Time workers between 15-64. I notice a very strong seasonal signal in the Female Part time stats as a percentage of the civilan population. In January of most years, it appears there is a drop of around 1.5-2% consistantly. See the graph below

The same signal is not as apparent in Male Part time work (or if it is, it is too small to be detectable)

So what would make women drop part time work so consistently over January?

It's either school kids or the beach in my opinion.

Budget Emergency! Maybe this is what Joe Hockey has nightmares about

Loss of Male Power and Identity - the decline of Male Full time work.

I'm always interested in gender politics and the like, and I wonder what the affect of the reduction in Full time work is having on the male population. Because the drop is dire.

Looking at the ABS figures on the Labor force, I note that the percentage of the male civilian population (15-64) that is employed full time is at all time lows...in fact August 2013 was the lowest ever recorded at 64.66%; the second lowest in Jan 2014.

This is in comparison to the all time high of 79.4% which was recorded in December 1980.

Now when you think the male identity is traditionally defined by being a provider, especially in a family situation, this has to have an impact on the male psych.

I'm sure the feminists out there will be talking about how the female full time employment to population ratio is still low at 36%, well, to that I say, at least it is on the climb (it was at 30% in 1978). Also women traditionally have other sources of power and identity that remain undiminished; the primary one being that of a mother, which does not require the full time job to self actualise.

Something to think on when the feminists are calling for total equality. See the graph below for the full details

Market risk Premium of ASX200 March 2014....Now at 12.5%!!!!!!!

Wow is all I can say.

Calculated the Market Risk premium of March 2014 and we are looking at a risk premium of 12.5% Getting pretty crazy out there.

ASX200 market return (Capital) over the last 2.5 years is sitting at 11.61% a year. Average dividends of 4.57%. Meaning the Market has returned a very nice 16.18% a year. Not bad going.

Risk free rate is now sitting at around 3.67% so that leaves us a Market Risk Premium of 12.5%! That is the highest it has been since I started recording them back in 2011.

For mine, that is getting a bit unsustainable. You would have to start thinking a big correction is coming as there is no way companies out there can have their equity cost of capital at those sort of levels. They can't have a ROE of over that consistently in the current conditions.

TPG still going strong - EPS growth is dead on the Sustainable Growth Ratio. Freakish

Another bumper result from David Teoh and his merry men at TPG.

15% growth in EPS, is smack dead on the sustainable growth ratio (with 37% as the new DPO..it was 26%) and an ROE of 24% (Remember the formula for sustainable growth = (1-DPO)*ROE)

Just goes to show how much of a cash machine this business is. Barely any debt and loads of dosh. And management consistently meet their targets. Who cares if David Teoh controls everything. He is the Rupert Murdoch of Broadband!

After the annual report was published in 2013, I was tempted to buy into this company as it appeared it was heavily undervalued. I actually had a price target of  around $9 on it...as it's return on equity was around 24% and it's cost of equity (using CAPM) was only 9%...And this was when it was trading at $4.30!

Price is now at $6 and I think the cost of equity has risen a bit. Still, might still be worth while buying in before the end of the financial year. Still, I could be wrong.

NOTE: Not a recommendation for people to buy/not buy TPG stock. Please see your financial advisor.

Premier Investments - A little too much Smiggling for mine

Premier Investments gave their half yearly results today...a pretty good effort, growing their sales quite well. Congrats to Mcinnes and all the kids.
However, I do wonder about their strategy to expand into the UK using their Smiggle brand, which is the sale of Stationary.

If you look at the results, Smiggle is actually one of the more under performing brands, by store

The order of performing brands is as follows

1. Peter Alexander (sales - 990,000 per store for the half year)
2. Portmans (571,000 per store)
3. Dotti (528,000 per store)
4. Just Jeans (432,000 per store)
5. Jay Jays (400,000 per store)
6. Smiggle (398,000 per store)
7.  Jacqui-e (364,000 per store)

So it just strikes me as a waste to go hard on Smiggle in the UK, when Peter Alexander would probably be a better fit. Sleepwear would be a bigger market and would be more profitable in my opinion.

Myer Total Debt/Equity ratio....now close to 3!

Myer results came out today. Pretty underwealming, especially compared to DJ's, its main competitor.

One thing that stands out is that DJ's 38 stores are better at raising revenue than Myers 66 stores...Dj per store revenue is $26.9 million for the half, vs Myers $21.9 million for the half.

And then we get to debt. When you include DJ's non-cancellable operating leases (discounted at 4.4% interest rate) of $1.1 billion to the on-balance sheet debt of $45 million, you get total debt of $1.15 billion. Equity for DJ's is $840 million, leading to a Debt to Equity ratio of 1.37. Not bad

But Myer's non-cancellable operating leases (discounted at 4.2% interest rate) is equal to $2.5 billion. Add on the balance sheet debt of $306 million and you get a total of $2.8 billion! Huge. On an equity total of $938 million, that gives you a debt/equity ratio of 2.9!!!

Maybe that is the real reason why Myer wants to merge with David Jones!