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The fun bit comes when the supremely confident hedge fund manager who may gaining by this actually stimulates the process of his demise. Sector consolidation certainly means that predatory eyes will also be watching PMI which is now trading at less than half it's sensible value of just over £2 a share. I'd delight in seeing PMI capitulate to a £1.80 surprise approach and the hedge to spontaneously combust.
"a hedge fund could get toasted" .... Their problem ... but I suspect that will simply have reduced profits rather than a toasting.
Looks that way but at this level and with sector consolidation active it's very risky, a hedge fund could get toasted......
80p is even more silly ..... some hedgie is taking this down .... let the share capitulate then buy more for the upside.
I just had to add a few more at 95.5p, this is getting silly...
Just a matter of time/patience. At this level the upside as either a stand alone or, as is looking increasingly likely, the target of a takeover bid, is significant. It could very easily double from this sub £1 level. Solid management, good team and prudent decision making look pretty good credentials for PMI to be a very juicy addition for an existing predatory asset manager.
Sisyphus
Agree with you
I topped up last week & added a little more today.
They do look attractive. Very attractive indeed sub £1...
Significant discount to peers leaves Premier highly vulnerable to predation at present for the reasons listed below plus it's seasoned and prudent management team. Sector consolidation is moving rapidly this year and PMI is a peach.
Calculating the logical share price for a listed UK asset manager with 158 million shares in issue and managing assets of £11 billion requires several assumptions, as the valuation of an asset management company depends on a variety of factors such as investment performance, fee structure, client retention, and market conditions. Therefore, any estimate should be taken as indicative and subject to significant uncertainty.
One approach to estimating the logical share price is to use a multiple of the company's assets under management (AUM) or its earnings. The most common multiples used in the asset management industry are price-to-earnings (P/E) and price-to-book (P/B) ratios.
Assuming the company has a P/E ratio of 15 and an AUM-to-revenue ratio of 1.5%, the calculation for the logical share price would be:
Calculate the total revenue generated by the AUM: AUM x AUM-to-revenue ratio = £11bn x 1.5% = £165m
Calculate the earnings based on the P/E ratio: Earnings = Total revenue / P/E ratio = £165m / 15 = £11m
Calculate the book value of the company based on the AUM: Book value = AUM x P/B ratio = £11bn x 1.5 = £165m
Calculate the logical share price based on the book value and earnings: Logical share price = (Book value + (Earnings x P/E ratio)) / Total number of shares = (£165m + (£11m x 15)) / 158m = £2.11
Therefore, based on these assumptions, the logical share price for a listed UK asset manager with 158 million shares in issue and managing assets of £11 billion would be approximately £2.11.
Sisyphus
Very true, I bet M&G would love Premier's performance record, not that they would be the acquirer, far more likely someone takes them, but your point is well made.
PMI is a very cheap stock, all we need is patience (& a bit of luck).
With AuM of £11bn and an MCap of just £156m this management team would fit perfectly into a bigger underperformed to boost prospects... Interesting as both a pure play on solid fundamentals and team with the added spice that it's a peach of an opportunity for a bigger player to acquire PMI and liven up it's quality. As a decent dividend payer, even a reduction would still place it in the top echelon of divi returns.
I was quite encouraged, better than I had feared tbh.
Best part about the rns to me was that 76% of their funds are in top half of their respective sectors.
I have dipped my toe in to average today as I'm guessing that the divi is looking just a little bit safer
Good to see AuM improved despite expected outflows due to financial sector blip. Premier is well positioned to benefit as sentiments shift and rebalance. Diverse exposure and a good team philosophy should see it be amongst the leaders going forward. Bit harsh to see it marked down aft market open but that should reverse as analysts look at improving sector prospects. Solid, but vulnerable to predation at this low price.
A bit of a holding action today. FUM up a bit but usual economic headwinds message.
POLR is on the up today .... just needs the RNS on AUMs
Agreed, the market is marking asset managers as a generic group with the same brush. PMI managed to steer itself well through the last decade as quality prevailed within a talented team. Last year was a tough one but Q4 22 seemed to indicate that the tide was turning post Covid. It's a difficult call given the current rise in inflation and cost of living constraints but PMI has a strong reputation and prudent management so should be one of the leaders as conditions improve. A firm hand on the tiller and a straight course are the key drivers. Hopefully there won't have been a dash for cash last quarter and AuM should be on the climb again.
Sisyphus
I agree with you but sadly Mr Market appears to disagree, which is often an ominous sign.
I would have thought the divi is safe, if so the shares look a steal at present.
First quarter AUM should be up and inflows could surprise given the nature of clients and revamp of quality teams. Solid.
yes why not , we are heading that way
Having risen and consolidated at this level it's time for a new push to break the previous £1.30 up to the £1.38/40 level for the next consolidation phase. Prospects look good for first quarter AuM given previous outlook.
Solid share thats correctingly nicely from a hugely oversold position. Assets under management will have risen nicely given market gains and the corresponding stimulus for inflows into well managed portfolios should see PMI bounce back to the high £1.80's in the next six months. Solid.
I read some report that claimed funds saw big outflows in January in anticipation of recession but I always had the feeling markets had too much time to prepare while energy prices falling will give people more cash to buy back higher so up and away … bought more low 120s today.
In a time where high yields are still associated with higher risk it's good to see an incentivised seasoned set of professional fund managers steering a steady course post Covid. Solid and well worth getting on board in the troughs between the escalating waves imo.
AUM must be increasing significantly over the last quarter from Dec 31st level plus cash inflows should be comfortably rising. Solid. Topped up at this level for the next step on this upward staircase after this small consolidation.
Am doing well with this one and bt at the moment