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Thanks Risk. Well, the one thing about shorters is, they will have to buy back at some point, so we know there's good latent demand for the stock out there at some point!!
Matt, I concede. I own a number of REIT's but Civitas was my first and only social housing REIT, probably most likely my last.
I invest purely for retirement income and have done so for 25+ years - mostly I've done okay to quite well with the usual caveats. To be fair my anger is mainly targetted at shorters - I despise them although I reluctantly accept they have a part to play in the investment universe.
I've moved on
Ok, so I did bait you, hence angry responses fair enough! Let's move on, and (hopefully) have a more stock specific (indeed, idiosyncratic) discussion.
Risking it- so I know EPRA very well, but they are not the drivers of the NAV calculation - they simply have produced a number of adjustments which they believe produce better reporting standards, eg focus on whether leases are finance leases or not, or whether some of the properties are under construction etc etc. The main driver of the valuation calculation itself is IFRS (International accounting standards basically). They outline 2 main approaches to NAV calcs - Market approach and income approach. In general, most participants use the Income approach unless there is a highly active market for similar properties in same area - this is not the case for Social Housing, so income approach is what is generally used. IFRS define this as: "The fair value of an investment property can be measured using discounted cash flow projections based on reliable estimates of future rental income and expenditure, supported by the terms of the existing lease and other contracts. ".
So, hopefully that's reasonably clear. Not to do with ego, simply experience and knowledge where I happen to have a bit of both.
riskingit - you mean you are not eternally grateful to the Ego for being 'kind enough' to give you some crumbs of advice from the captain's table?! haha It always makes me chuckle when I read these posts from the Walter Mittys - they are always ahead of the game, in profit with every share (normally huge profit) and they never put a foot wrong - absolute geniuses every one of them. Hahhahaha
Oh and by the way Matt The Ego
Have yoiu ever heard of the EPRA? I doubt it because you never quote any regulated authorities in your rantings.
Well check them out - they provide extensive rules for REIT's and NAV valuations. They talk about 'fair value' , independant & 'mark to market' - Not a word about leases.
So by all means sit back and revel in your superior intellect but please for any future rants about how much knowledge you possess over and above us humble poor investors - try putting a lid on your fat ego
haha big egos are so easy to bruise
Come on Walter, you must of heard of DENSA given that you are one of the founding members, hahahha
'not sure why they decided to make this Board their home........' Errr, probably because we are shareholders?!! I thought even a Walter MItty like you could work that out, lol
We now have the man who believes in 'spare money' and doesn't understand words of more than one syllable, joined by the genius who appears to have invested in a REIT but doesn't understand how lease structures feed into NAVs (though he should now because I was kind enough to explain it to him). It's great to have the 'Brain Trust' posting here for our benefit isn't it, LOL.
Not sure what the opposite of MENSA is, but not sure why they decided to make this Board their home........
hi riskingit - just a bit of fun popping these peeps ego balloons!!
Punter why do you take them on - Leave them to their egos. Time will tell, in the meantime sit back and enjoy the income
Know this, if every hedge fund short ended in a profit we'd all be pretty wealthy right now. Just look back at the pain siffered by the shorters of Tesla, Amazon, Moderna & Herbalife
Yep, pass me the valium I am in a complete state of shock. On second thoughts the 6% dividend might just calm my nerves, haha
Yeah, but there is still some action here. By their own admission, some of their income is flowing through subsidiary investments of SHO. That's pretty shocking not least because that same income then flows through the direct customers of csh, several of which are under investigation by the housing regulator. ( And yes, the school kids are right- it may trade at a premium to NAV, but I think things have changed since the last time that happened. )
We'll see. Good luck.
Apologies for some of the typos and poor spelling. Should have read it first!
Hi Lucy,
Thanks for your response. I think you are right in saying that is a lack of further catalysts such that the downward momentum has ceased. SF have thrown all the mud they have and CSH is no longer engaging so I can't see much more negativity for the SP in the short term the NAV of 108p maybe an aggressive valuation but I don't see that changing for the next update. As you say, the lack of an insider braking ranks also limits the downside.
I see a drifting in the 90s for a while now. Nothing to drag it much lower but sufficient reservations to take it back to 110+.
My new average is 88.9p so I was partly out today at 90.45p and I will clear the rest towards 95p I hope.
What? 'The response to SF held some promise that there would be a break in the ranks of the insiders and that didn't happen'. Is there are Lucy DS translator out there who can help to decipher this nonsense?
That’s not a bad effort, if I may say so, Lucy . I’m glad you picked up the gauntlet. When you say that the valuation is capped at 108, are you referring to the NAV, which is currently just over 108, or do you mean the level at which the share price is unlikely to progress? If you mean the share price, I would have thought that 20% upside from here is an unattractive prospect for a PI considering shorting the share using, for example, the IG platform. That could mean carrying a significant financial loss, not to mention the costs and charges IG impose on any open position.
Some people would agree with you the NAV is marked aggressively, which is no doubt why the share price currently stands at a 19.28% discount to that NAV. Others might disagree, which is why we could see the discount narrowing. Given that all the issues relating to Auckland and Falcon and other aspects are now in the open, it is difficult to see what additional information could emerge which would further enlarge the discount.
And you yourself acknowledge this, when you mention “the lack of a clear, near-term catalyst”. This is another way of saying that all the adverse news is already in the price.
I suppose organizations like ShadowFall have the resources and tenacity to sit it out for some time. But I see this situation as somewhat akin to a medieval siege. CSH are secure within their ramparts, while SF are camped outside, having failed to breach the walls: their attempt to so was repulsed and they have no new means of attack at their disposal. Moreover, the siege is costly for SF and the longer it continues, the greater the cost. Given the law of diminishing returns, they would be well advised to saddle up and gallop off into the sunset, along with the booty they have already collected. (This is of course exactly the point Redtom made earlier, but a lot more economically that me!)
Oh dear, more verbiage. Perhaps you can't remember that far back but this was recently valued at 122p so no idea where your cap of 08 comes from, lol. The 'aggressively priced NAV' (whatever that is supposed to mean?) has been independently assessed at 108p. Last time I looked Auckland and the regulator had agreed to work together to ensure best practice.
Hi Redtom, on fundamentals, I think it continues to have a lot more downside than upside. I see the valuation capped at 108 which is only 20% above where we are now. Not exactly scary for a short seller. On the other hand, I see a lot of indication that the NAV is marked aggressively, and it is clearly highly reliant (along with the dividend) on payments from Auckland and Falcon, both of which are under investigation by the social housing regulator.
The big problem on the short side is the lack of a clear, near term catalyst. The response to SF held some promise that there would be a break in the ranks of the insiders and that didn't happen. So in some ways I agree with you. Patience needed. :-)
It’s noticeable that the normally chatty and sociable “Lucy” has suddenly gone quiet. The well-judged question by Redtom posed a bit of a dilemma: s(h)e could not credibly advise “go short,” given that this is obviously highly risky now that the tide appears to be turning; but s(he) could not advise “don’t go short” without undermining SF’s objectives and biting the hand that pays her/him to post here.
Lucy,
Genuine question - do you think there is much more scope for shorters to make much of a profit from here? It seems to me that the SP has settled after the run of disclosures and it is difficult to see it drifting much further given the dividend is secure and assuming that the next NAV update is consistent with the past, ie 108p+. Surely the likes of Shadowfall have made their money on the drop from 120p to 88p?
Lucy, how are you getting on with that freedom of information request? Are you still looking for the tooth fairy hahhaha. On second thoughts maybe you are too busy looking for the 'share borrow' on that CFD? hahaha.
"I am not saying that CSH has conducted its affairs in an utterly pristine way" - said with wonderful English grace. I agree with that bit. :)
Essex Dog
I must hand it to you – you are the best de-ramper on this site, and I hope you are well rewarded. Very well disguised and operating at a subliminal level, which fools most readers. The main give away is the disconnect between some of your “idiot boy” naïve questions (which helped the - patently obvious deramper - Lucy gain credibility and some popularity) and the somewhat more “sophisticated” and "insightful" comments, of which “Directors” is an example. Your posts elsewhere on LSE, on shares other than CSH, when you are “in” another character, are also revealing.
On the face of it, your posts represent the view of the “ordinary bloke”, struggling to make sense of it all – a character with which a lot of us can identify. But embedded in your comments are words and phrases designed to work at a subliminal level in the minds of wavering PIs. Examples are “go to jail”, “Dodgy Directors”, “questionable ethics” and “immoral”. It’s very subtly (and if I may say so) professionally done.
If your talents, and the collective efforts of SF and its associates, result in a short-term fall in the CSH share price, that would be OK for me, since would give me the option to accumulate an even deeper discount.
For the avoidance of doubt, I am not saying that CSH has conducted its affairs in an utterly pristine way; nor am I saying that an investment in CSH, even at these levels, is risk free. Far from it. At the end of the day, investors must shoulder the risk, so as to reap the rewards.
I appreciate that it will be necessary for you find some way to deny the “deramper crown” that I am offering to you . And you may well be able to convince those who are looking for a reason to believe. But rest assured: I see you.
Agreed. It sounds like good business sense to me! Storm in a teacup and the yield here now makes this a strong buy for the long term.