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I have no problems with debt per se if it is used to fund growth ..I like to make assets sweat, and nothing like a little debt to keep senior management on their toes and earn their salaries and bonuses
What I dont approve of is debt being used as a sweetener to shareholders to make dividend payments , and I don't go anywhere near companies who take on debt to pay for the housekeeping !
Sorry winged it ..a very long winded reply on NRR but there was lots to get through ..
Regarding Cey...the peer premium comparison on NBV on this basis alone suggests to me it is very undervalued , although it still has to be said that only 70% of its net assets are being employed , with the rest in non revenue earning cash ..that is about to change though .
My major concern remains that we only get 50% of the profits from the 70 % of assets which are employed , and apart from production which is within management control, they are heavily in the hands of the gold price which isn't within their control..and given that gold prices are still very high from a historical perspective , they would be heavily succeptible to a prolonged fall in gold price .
Exit point for me ? £1.35 to £1.40 if it can achieve that by March of next year .
It can and will get to £2.00 plus again at some point , but I would rather run, and roll up the gains on another share , although none are on the horizon for me at the moment . Market prices and PE ratios are too high.
As usual DYOR..
Winged it. .to be honest I am not yet sure. .I would need to see the next interim accounts to see the impact on profit that the Sale of Hawthorne pubs has made .
Pre Covid in Feb 2020. It was trading at over £2.00 then 6 weeks later it was at a one year low of 60p. I knew it was undervalued so I bought in and heavily too . However just because a share is way undervalued doesn't mean to say it can't get even more so ..it fell down to 42p !! I invested more cash at 48p. I held my nerve Finally in the summer it rose from 70p to £1.06 in 2 weeks .. it hovered and fell then they announced the sale of Hawthorne , the price shot up (fools !!) and I got out at £1.06 before the market realised what they had done...sold their prized income earning asset to reduce LTV which had been dropping like a stone.
The rest is history .it went on steady decline to 75p ish.
I won't know whether this is a good entry point until as I say , I read their interims. They will have lost half of their revenues and profits even more because I bet they don't chop corporate salaries and overheads .
I wouldn't enter now though ...so if you went in at 90 p ..I can't see it going above that soon although there is a massive discount between NPV and market value...so who knows .it just needs some good news .
If I was you and I was sitting on a near 20% loss it's an even call.. may be best to hold and wait for the interims. I have no doubt it will rise..in time ...their retail strategy of investing in essential retail (60% of their tenants were open during Covid lockdown ) and not having any of their tenants generating more than 3% of their revenue is a sound one .. so I think it will rise but you might have to be patient ...for me Cey is a better bet
Good luck .
Interesting Candid.
Do you have a mental sell price for CEY? If you wouldn’t mind sharing…
I also have a small holding in NRR (at 90p - so at a loss) but wondering where it’s going. A line on that would be interesting too if you have a moment :-)
Sorry ..I posted this on the wrong thread
https://www.google.com/url?sa=t&source=web&rct=j&url=https://amp.ft.com/content/f9afe5b0-2167-11ea-b8a1-584213ee7b2b&ved=2ahUKEwiD-66DvNnzAhUUoVwKHcMMCvUQFnoECCYQAQ&usg=AOvVaw0TSAIcFBcEcO_3eq09TJcG&cf=1
Should have said Muddy waters report
Yes I agree with you totally ...well , the vast majority of the time . Patience is always the key
I bought Ferrexpo for £1.02 ! write at the bottom during Covid ...I sold months later for £2.10 ish but then just a few months later it hit £4.75 !!
One vastly under priced , the other vastly over priced ..it has now fallen back to £3 .17
I did the same with Polymetal...sold way too soon , and Plus 500 too..
Likewise though , others I timed just right like NRR
I also made very shrewd moves, even selling at a modest (less than 10% loss ) with Saga, Carillion , Amigo and NMC Health ..I picked up very quickly on dangerous shifting fundamentals and exited. I did tell other investors on those boards what I was doing and why , and I was ridiculed and insulted ..lots of paper tigers on investor chat forums like this.
The local farmers where I live have a saying… “the day you buy, is the day you sell “
It means if you manage to buy at a lowball price you’ll always make money even if you don’t sell at the top of the market. I think this very much applies to share trading.
If you buy them cheap it doesn’t matter if it takes 6 months or a year to reach their your always gonna win!
Steve ...yes I think the reason why I like the mining sector so much is that very few people understand it (and I include myself in this ) and the few people who do are on this board !!
This lack of knowledge out there is probably what creates the huge disconnect between a mining company's share price against its fundamental value.
Prime hunting ground for me ( and you presumably ) no doubt the "buy and hold forever " type investors may have a frown on their faces at that .
My approach is similar -
Also with Cey ..as you can see , its share price doesn't go up in steady incremental steps ..it goes up and down like a heart beat ..from March to September 2020 for example , it more than doubled , from 98p to £2.20 then it lost 50.% of its value over the next 6-8 weeks ...yes overshadowed by production problems ..but mining shares in general do tend to go up and down in similar fashion , reflecting the markets tendency to overreact , sometimes quite significantly, in the face of both good and bad news .
This suits my investment style perfectly . I buy shares when I think they are undervalued against their fundamentals , and then sell them , when I think they are over valued .
I go for 'stealth' moves ..in and out within a year , I usually make a profit , but I do tend to exit too soon and miss out on larger gains , but hey , a profit is a profit as they say .
I don't ever get emotionally attached to a share , so if the fundamentals take a significant turn for the worse , them I am quite prepared to sell at a loss , rather than having blind faith in it .
As I say , I usually come out on top , some may say luckily...well I do tend to find that the more research I do , the luckier I get ! .
I have made money on other mining shares using this approach ( but lost money twice on Fresnillo which I now avoid ).
This is my first investment in Centamin ..lets hope luck holds.
Good luck to all.
Check out Fundsmiths Global Equity unit trust Fund ...it invests large cap growth companies around the world . It has returned 18% compound per annum.). for the past 10 years ..similar annual returns for 5, 3 and 1 year too .
Two thirds invested in US equities though so does carry some country specific risk
Having been shocked by the amount of money that has run into the crypto space, there is in fact money running all over the place, trying to look for a fabulous home. The Venture Capitalists are out in force, with their shotgun approach (they dont talk about this much, ... one 10 bagger and 9 scrubbers, and sometimes 0 10 baggers and 10 scrubbers, but they talk about this less) and so many others to help invest the money floating around. Of course it is OTHER PEOPLES MONEY, AND MUCH OF IT THE TAX PAYERS ARE ON THE HOOK FOR...but please dont worry we are all in good hands.
SPACs [Special Purpose Acquisition Companies] are v interesting and have been raising funds faster than ever before! (seems that there is more money been printed than ever before, but lets not go there) In 2020, SPACs raised close to USD 100 billion in public offerings, which is more than in the prior 10 years combined ; the average IPO size also doubled from 2019. On July 22, 2020, Bill Ackman’s Pershing Square Capital Management raised USD 4 billion in the IPO of Pershing Square Tontine Holdings Ltd., recording the largest SPAC IPO to date. OK billions not trillions, but the world is flush with cash. It is NOT flush with great investment opportuntiies, and as such we see grossly distorted P/E ratios and an ever spiralling NON TANGIBLES (because like Elon Mush we are now all going to the moon [and then what happens?] LOL)
So in all the rushing and gushing, it still turns out that making about 8% pa over 10 years is a very solid return. (John Bogle was right.). So if one can build on the say 5 % div from CEY and catch a 3 % growth pa, then you are in a good space?
[But of course this does not pay the salary and bonus of Bobby Broker, and the managers of the hedge funds and SPAC's etc etc]
best
the gnome