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Oceana Group Limited

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Our opinion on the current state of OCEANA(OCE)Oceana is Southern Africa's largest fishing company, with additional interests in the US through its subsidiary, Daybrook Fishing, based in Louisiana. Listed on both the JSE and Namibian stock exchange, Oceana produces a range of fish products, including canned fish, fish meal, fish oil, hake, mackerel, lobster, and squid. The company operates under government-issued quotas, which are periodically influenced by regulations, including Black economic empowerment initiatives, and is also impacted by weather conditions affecting fish stock availability. In the financial results for the six months ending 31st March 2024, Oceana reported a 12% increase in revenue and an 84.6% rise in headline earnings per share (HEPS). This growth was primarily driven by Daybrook Fishing's record earnings and improved canned food sales for Lucky Star in the second quarter. For the full year ending 30th September 2024, Oceana projected a HEPS increase of between 15% and 19%. It noted that the prior year's profit increase was significantly influenced by the disposal of CCS, which impacted earnings per share but not headline earnings. Oceana’s share price has been trending sideways to downward since January 2023, trading on a relatively low price-to-earnings (P:E) ratio of around 6.39. The company remains fundamentally strong, though it is subject to volatility due to weather and regulatory factors. Oceana’s new CEO has indicated interest in expanding into aquaculture, though competition restrictions limit opportunities within South Africa. Additionally, Oceana obtained a secondary listing on the A2X exchange on 27th March 2023, offering more trading options for investors.
JSE:OCE
by PDSnetSA
Our opinion on the current state of OCEANA(OCE)Oceana (OCE) is Southern Africa's largest fishing business with significant fishing interests in the US through its Louisiana-based subsidiary Daybrook Fishing. It is listed on both the JSE and the Namibian stock exchange. The company produces canned fish, fish meal, fish oil, hake, and mackerel, as well as lobster and squid. It is subject to quotas issued by the government periodically, which can be affected by moves towards Black economic empowerment. Additionally, weather conditions can significantly impact the size of the catch. In its results for the six months to 31st March 2024, the company reported revenue up 12% and headline earnings per share (HEPS) up 84.6%. The company said, "The growth was primarily driven by US-based Daybrook delivering record first-half earnings as well as a pleasing Lucky Star performance following improved second-quarter canned food sales volumes." Technically, the share has been rising since July 2022. It trades on an earnings multiple (P:E) of around 9.45. In our view, this is a solid blue-chip, which has been made more volatile by its exposure to weather conditions and regulation. The new CEO says that the company is looking to make an acquisition in aquaculture but is precluded from doing so in South Africa because of competition restraints. On 27th March 2023, the company announced that it had obtained a secondary listing on the A2X exchange. Oceana appears to be a well-managed company with strong growth prospects, particularly with its US operations performing well. However, potential investors should be aware of the volatility that comes with its dependence on weather conditions and regulatory changes. The company's strategic moves, including potential acquisitions in aquaculture, suggest a forward-thinking approach to growth. Overall, Oceana is a good investment but requires consideration of its inherent risks.
JSE:OCE
by PDSnetSA
$JSEOCE - Oceana: Testing Double Bottom Neckline ResistanceSee link below for previous analysis. Oceana traded bullishly as previously forecasted. The stock has found resistance at the Double Bottom Neckline zone between 7450 to 7990 cps. Price has consolidated at this range which indicates that the bulls do not want to give the initiative. A clear break beyond 8000cps, preferably on high volume, will validate the Double Bottom and could take the stock towards 11800cps. This is more of a buy and hold stock so I will remain bullish as long as price is above 4148.
JSE:OCELong
by Loyiso_BlaqueSoros_Mpeta
Our opinion on the current state of OCEANA(OCE)Oceana Group, Southern Africa’s largest fishing business, holds a prominent position in the industry with a significant presence not only locally but also in the United States through its subsidiary, Daybrook Fishing. The company's broad product range includes canned fish, fish meal, fish oil, hake, mackerel, lobster, and squid. Oceana is dual-listed on the Johannesburg Stock Exchange (JSE) and the Namibian Stock Exchange, reflecting its substantial market reach. The business is heavily regulated, subject to government-issued quotas, which can fluctuate due to policies such as Black economic empowerment. Additionally, operations are significantly impacted by weather conditions, which can affect catch sizes and operational efficiency. For the six months ending 31st March 2023, Oceana reported impressive financial results, with revenue up 48% and headline earnings per share (HEPS) increasing by 123%. The company attributed this strong performance to its diversified portfolio across different species, geographies, and currencies. High initial inventory levels of canned fish, fishmeal, and fish oil, coupled with robust demand for canned fish and favorable pricing for fish oil, helped the company navigate challenging operating conditions. In its trading update for the 11 months up to 27th August 2023, Oceana noted an 8% increase in Lucky Star canned fish sales volumes, though there was a 5% decrease in US landings of fish. Horse mackerel sales remained stable. Looking ahead to the six months ending 31st March 2024, Oceana estimated that HEPS would rise by 89% to 99%. This forecasted growth is primarily driven by higher sales volumes of fishmeal and fish oil by Daybrook, along with strong pricing for fish oil in US dollars, and enhanced canned food sales from the Lucky Star brand. The company's share price has been on an upward trajectory since July 2022, currently trading at an earnings multiple (P/E) of around 9.62. This valuation suggests that Oceana is well-regarded as a solid blue-chip stock, although its exposure to environmental factors and regulatory changes introduces a degree of volatility. Oceana's strategic direction includes exploring opportunities in aquaculture. However, the company faces constraints due to competition regulations within South Africa. This limitation has prompted considerations for potential acquisitions outside of South Africa to bypass these restrictions and expand its operational footprint. Noteworthy corporate developments include the resignation of PWC as its external auditor in May 2022 and the acquisition of a secondary listing on the A2X exchange as of 27th March 2023. These actions reflect ongoing adjustments in its corporate governance and market engagement strategies. In summary, Oceana Group presents as a robust investment with potential for significant growth, underscored by a strong operational base and strategic market positioning. However, potential investors should be mindful of the inherent risks due to regulatory, environmental, and market volatility factors.
JSE:OCE
by PDSnetSA
Our opinion on the current state of OCEOceana (OCE) is Southern Africa's largest fishing business which also has significant fishing interests in the US through its Louisiana-based subsidiary Daybrook Fishing. It is listed on both the JSE and the Namibian stock exchange. The company produces canned fish, fish meal, fish oil, hake, and mackerel as well as lobster and squid. It is subject to quotas which are issued by the government periodically and as such can be affected by moves towards Black economic empowerment. It is also subject to weather conditions which can have a significant impact on the size of the catch. In its results for the six months to 31st March 2023 the company reported revenue up 48% and headline earnings per share (HEPS) up 123%. The company said, "This performance highlights the strength of being a diversified Group across species, geographies and currencies. Higher opening inventory levels of canned fish, fishmeal and fish oil, strong demand for canned fish and continued price improvements for most of its products, particularly fish oil, enabled the Group to counter the effects of these tough operating conditions". In a voluntary trading update for the 11 months to 27th August 2023 the company reported Luck Star canned sales volume up 8% and US landings of fish down 5%. Horse mackerel sales were unchanged. Technically, the share has been rising since July 2022. It trades on an earnings multiple (P:E) of around 9,81. In our view this is a solid blue chip, which has been made more volatile by its exposure to weather conditions and regulation. The new CEO says that the company is looking to make an acquisition in aquaculture but is precluded from doing so in South Africa because of competition restraints. It is a good, but potentially volatile counter. On 30th May 2022, the company announced that its external auditor, PWC had resigned. On 27th March 2023 the company announced that it had obtained a secondary listing on the A2X exchange.
JSE:OCE
by PDSnetSA
OCEANA swimming to our target of R76.00 Since our last Trade Update with Oceana, the market is still on track to R76.00. The Quazimodo Inv Head and Shoulders seems to be working, but taking its damn time. Also we have stronger bullish confirmation signals like 7>21 Price >200 RSI >50 All great signals for upside momentum Here's general information about Oceana. Oceana (founded in 1887 and headquartered in Cape Town) is the largest fishing companies in South Africa and largest fish canned company. It is involved in the harvesting, processing, and marketing of fish and fish products. They operate a fleet of over 20 vessels and exports products to over 50 countries world-wide. The company's main species of fish include hake, sardines, and anchovy. And is involved in fishmeal and fish oil production. Their main brands are Lucky Star, Oceans, and Klipkop.
JSE:OCELong
by Timonrosso
$JSEOCE - Oceana Group: Double Bottom & Good FYE 2022 ResultsOceana just released a good set of FYE 30.09.2022 results, the salient results are • Revenue: +12% to R8,148m (2021: R7,296m); • Operating profit before other operating items: +11% to R1,250m; • Profit before tax: +14% to R1,064m • EPS: +16% to 622.9cps; • HEPS: +17% to 626.0cps; Cash Flow & Financial Position • Cash Generated From Operations: (33%) R990m; • Total CAPEX: (12%) R259m; • Net Debt to EBITDA: 1,7x Technically, there is also reason for optimism. Oceana stock peaked at an all time high of R134,74 back in March 2016 and has been in a bear market since. What is positive though is that the share, like many, had a significant bottom in March 2020 at R41,48 and chopped its way to R78,47 before retracing to R43,00. Though premature to call it, the R41,48 and R43,00 bottoms could potentially be a double bottom pattern in the making. I am also keeping a close eye on a potential inverse head and shoulders pattern on the right side of the double bottom scenario. This bullish outlook will be invalidated by a break below R41,48.
JSE:OCELong
by Loyiso_BlaqueSoros_Mpeta
OCERecently, the group reported a strong set of results of with Revenue + 9% to R8 308 million, Operating profit up 21% to R1 399 million, Operating profit Africa operations up 22% to R975 million, Headline Earnings Per Share +15% to 628.4 cents while cash generated from operations improved to just over 2bn. Total dividends of 393 cents per share were paid. Driving the 9% increase in revenue was the group's operations being classified as an essential service provider in all geographies during the peak Covid-19 lockdown period with increased fishmeal sales, consistent supply and sustained demand for canned fish together with favourable pricing across most products which was further enhanced by the benefit of a weaker exchange rate. Operating costs remained well controlled during the year, supported by production efficiencies in the group's canneries and fishmeal operations, improved occupancies in the commercial cold storage business and further aided by the closure of under-performing operations in the prior year on export revenue. A defensive approach was adopted during the period, immediately introducing proactive measures to strengthen the balance sheet and optimise cashflow management including a reassessment of planned capital expenditure. Cash generation was strong while the group saw an improved cash balance of R1.2bn vs R588m during the prior period. At 628.4 cents, this places the share on 11x trailing earnings. We also note the share price trading at a forward price/earnings ratio of 9.12x, nearing the lower end of the 20-year valuation range. From a technical perspective, the share trades just above it's 200-day moving average and above the price pivot with higher lows in place over the short term which signals buyers continuing to be interested at higher levels. Provisional Levels | Buy Stop: 7223c, Stop-loss: 6644c. Targets: 8150c, 8699c.
JSE:OCE
by LD_Perspectives