We would love to hear your thoughts about our site and services, please take our survey here.
To provide shareholders with regular, sustainable, long-term dividend income and to preserve the capital value of its investments over the long term by generating exposure to infrastructure debt and/or similar assets.
Find out MoreLondon South East prides itself on its community spirit, and in order to keep the chat section problem free, we ask all members to follow these simple rules. In these rules, we refer to ourselves as "we", "us", "our". The user of the website is referred to as "you" and "your".
By posting on our share chat boards you are agreeing to the following:
The IP address of all posts is recorded to aid in enforcing these conditions. As a user you agree to any information you have entered being stored in a database. You agree that we have the right to remove, edit, move or close any topic or board at any time should we see fit. You agree that we have the right to remove any post without notice. You agree that we have the right to suspend your account without notice.
Please note some users may not behave properly and may post content that is misleading, untrue or offensive.
It is not possible for us to fully monitor all content all of the time but where we have actually received notice of any content that is potentially misleading, untrue, offensive, unlawful, infringes third party rights or is potentially in breach of these terms and conditions, then we will review such content, decide whether to remove it from this website and act accordingly.
Premium Members are members that have a premium subscription with London South East. You can subscribe here.
London South East does not endorse such members, and posts should not be construed as advice and represent the opinions of the authors, not those of London South East Ltd, or its affiliates.
That's probably not far off the mark Tagvil - a 9% yield seemed to be sensible with interest rates at 5% and a 4% premium for risk adjusted assets. But fair value in the current market has lost the plot - and shows no sign of any improvement in the near future. GCP have evidenced the prudent valuation principles in their portfolio with the recent biomass transactions and yet we are still approaching a 50% NAV discount and a 12% yield. I have been a buyer in the 90's, 80's, 70' and 60's based on the underlying strength of the assets (short term power price adjustments aside), managements conservative approach and the volume of loans which will be redeemed in the next three years to repay the RCF, continue buybacks, improve capital returns and make selective investments at higher rates of return where available. The markets will hopefully return to some degree of normality in 2024 and GCP should benefit from this in time - in the meantime - c.12% yield at current pricing seems too good to be true.....SB
It is reassuring to see a couple of directors have bought recently:
23-Oct-23 19-Oct-23 Buy Andrew Didham 62.70 GBX 15,949 132,896
23-Oct-23 19-Oct-23 Buy Andrew Didham 62.70 GBX 23,923 132,896
09-Oct-23 06-Oct-23 Buy Alex Yew 65.62 GBX 20,000
I have held a fair amount of these for a number of years, and have added a further 40,000 over the last few days. I would like an opinion of what investors feel is fair value for this stock in the current climate. My own thoughts are around a 9% yield which equates to a share price of 77p. I would add that I would hope this will improve at the first sign of an interest rate reduction.
For it to achieve a period of sustained selling for the longest in the funds history take some doing ... They better confirm the dividend sooner rather than later as this is acting like a penny stock not a fund!
Money pouring of the UK … and I can’t say I blame it. The risk is that some GCI income streams go under, while social housing assets will fall in value …. But at stands, unless debt is inflation linked … those non inflation linked assets will be paying debt off cheaply relative to the wider market … so good for them, and good for people buying in now IMO.
I’ll be topping up more next week.
Own these at an average of 71 1/2p. Find it puzzling too. The NAV hardly dropped at all and the discount to NAV is massive now. Will just keep holding, take the dividend and wait for them to recover.
Big dividend shorts have to pay ….. when this squeezes which it will … I’ll be enjoying the ride.
Rising bond yields mean income streams (like GCP) are worth less. You can earn a safe 5% in a bond so need to see more from a share like this. But - the income from GCP, though riskier, should grow steadily (and one day interest rates will fall a bit ...)
I'm in agreement with you, I'm trying to think why the Market sees it differently. I suppose a third reason is trend, and a downward trend is hard to get out of . My opinion is that the fall to 60p is baffling.
Stewart...the manager reckons there will be an uplift in divis going forward once debt paid down. The opposite of what the market seems to be pricing.
Thanks for sharing.
Can’t believe this is still going down!
Money makers always a good listen.
Bought this at 72p when I thought near the bottom, will top up.
Agree with previous posts, it's about sustainability of the Dividend and then comparing a possible reduced dividend to cash rates that look likely to be elevated north of 5% for years not months. Clearly our own MPC haven't got the balls to tackle inflation, and that will likely lead to sticky inflation persisting longer along with higher rates. The Market are right to have lost faith in the MPC's ability to control inflation, they have made simply dreadful decisions over the last few years, Cath Mann excepted.
I am sooooo going to buy more of this fund tomorrow ...never seen such a mismatch on pricing to NAV in my life and I am OLD!!
Https://podcasts.apple.com/gb/podcast/money-makers/id1154102371
That this continues selling off with such a reassuring update..I'll just keep buying with the divi's as they come and one due again soon
Looking at a lot of these renewables and thinking surely they can't go any lower, and still They do.
The last 4 quarterly NAV updates were:
28 July
27 April
27 January
20 October 2022
If they are consistent, then we should get the next NAV update in the next week or so.
Do you have the date for that? I can't see it on Gravis's confusing site.
Should hear from the team next week - NAV, dividend and full year report due. Will be interesting to see where GCP goes next following GABI and RM knock backs. All key valuation metrics now complete nonsense. Current market value £550m v net assets of £1B and third party valuation of £1.1B - and those valuations are relatively conservative based on what the company achieved on recent asset sales. Gravis appear overly punished as investment managers continue to reduce holdings and by doing so inflict losses on their investors. That said - there’s a lot of bad stuff happening in the world and some pain here needs to be taken in context. SB
Guess this goes someway to shedding some light...
https://www.euronews.com/2023/10/10/green-stocks-in-the-red-renewable-sector-tumbles-as-investors-pull-out-billions
Thanks for the response #theoldmansdoneit.
I need to do some more digging I think...
No, I’m as flummoxed as you! Obviously some drop is due to the rise in interest rates making any GCP borrowing at floating rates more expensive and making equity relatively less attractive as an investment, but the recent fall seems to me to be disproportionate.
Yield now >10% and according to Trustnet, the discount to NAV is 28.7%.
Clearly the big boys in the market have doubts that the dividend is sustainable at this level. It would be reassuring if the Directors could issue an RNS to reassure investors that there’s no reason they know of for this drop. Also not much in the way of Director share purchases other than a modest 20,000 by Alex Yew on 6 October. If they were such a bargain, surely they’d all be piling in. I’m rather nervous but certainly don’t intend to sell any at this price. Hopefully all bad news is priced in!
I'm looking to invest here and just can't understand why the price has been in constant decline.
Anyone able to offer a bit of insight as can't see what I'm missing here?
Could be a number of things - might be waiting to cancel en masse once current buyback is complete; they might actually hold them back and sell when (if....) share price recovers; or they might not actually be focusing on this given the buybacks total about £10m and this sum is being lost in market cap every day for some time now - £400m below 'book' value. The entire infra sector, much like the stock market in general, is a busted flush at the moment. Latest hit is HS2 - not that anyone is actually investing in that basket case as its a capitally funded project but why let reason get in the way of investment manager strategy. SB