Member Info for damofarl

for openness, and to somewhat support scandiexpat's observations, i am also proportionally quite heavily invested in US companies that do similar to TORO but not in Company debt but household mortgage debt, but fundamentally the same business, borrow at 5% lend at 6%, the difference being the divvy. These 6 investments, , also totalling about 12% of my portfolio, are collectively about 15% down, all having larger market caps/liquidity/volatility but throwing of the same sort of divvys and they DO oscillate very much to macro economics considerations.

Yes i have 25% of my portfolio in debt!

scandiexpat; welome! I think my point regarding low liquidity/low movement has rather been proved with Thursdays market selldown, yet us TORO'ains are barely moved! I very much agree with most of your thoughts - diligence yes! Personally i think the first 2 are insignificant (inflation, rate movements). The way TORO operates it is constantly rotating/exiting/offering new debt, repricing as it goes, so as such, those 2 factors don't really impact as it is just selling money at a margin higher than it has bought it. War benefits no one except arms companies, and beyond life, it could cause recessionary impacts, which will impact the underlying businesses that are borrowing our TORO money, potentially raising the default rate. TORO seem very proactive and adept on this, as witnessed by their low/in line default rate at and through the corona virus. I don't think this needs hyper monitoring, and anyone that feels such, shouldn't be invested here, but i agree anyone invested here should monitor updates. Despite the very technical nature of this investment, TORO's monthly factsheets are refreshingly open, plain talking and accessible, and whilst ordinarily its NAV discount might suggest a red flag (as might it's yield), these factsheets inform you that that disparity is purely down to a misunderstanding of how it makes its money not due to any lack of ability, probity or performance delivery. They have also been incrementally increasing the debt rating of their loans, recycling up to better quality.

Notwithstanding my total confidence in TORO, anyone investing in this, or similar, should note their collatorising (sharing) is not dissimilar to the bundling of US mortgages, making a 'basket' that supposedly spread risk but actually on default/downturn concentrated it, that caused the banking crisis, and in that i agree with you ScandiExpat, not to micro watch but definately be aware of the risks.

Personally across my holdings in this sphere of stocks, I'm overweight, and more than i would want to be, but i'm comfortable with that and with the consistent throw off of divvis that that overweight is reducing such rapidly. Despite my position, i wouldn't recommend anyone have more than 5% in this sphere unless you understand the risks as well as the reward.

Lovely to not be alone here! Good luck to all; patience will out.

fairanalyst; fair point; a sad point but a fair point; western money will out while Ukrainian lives' lights go out.....

raggedtp; welcome to our small and merry band! You make a good observation on the liquidity of TORO vs TORG, TORO hardly being liquid! A point i think answers Gavster-NBC's question. I'd definitely go TORO.

gavster-NBC; yes, the lack of liquidity/movement can actually be a boon. Take the Ukraine wobble at the moment, my portfolio generally 10% down, some considerably more as i have some esoteric stocks (potentially impacted by sanctions). And TORO drops not an iota! This and the 3 other stocks in a similar sphere i hold represent 3% each of my portfolio, which is enough for me in any company/genre - none of which have dropped. In none of them do i see a rerate/surge in SP, a slow sure rerate yes, but three of them, especially TORO have a considerable NAV discount, and have substantial cash as % of market cap. This provides comfort, as does the consistent unstinting dividends at 10% plus. If i wasn't "over" diversification wise in this sphere, i would definitely add. At one point my 4 shares in this arena represented 18% of my portfolio, they now represent about 12% because the consistent dividends they have thrown off, i've put into more staid boring lower yielding divvis like tesco. I don't see any magical rerate to SP reducing the NAV discount because i just see TORO keep on making margin (profit) i see the green you see carrying on. Their conservative way, will mean the divvy will conservatively rise, and as the SP slowly, very slowly, but surely rises, for holders today, long term patient holders, the yield will be proportionally astronomical.

If you go back to January and pre EVR fall, and pre RASP rise, EVR's holding in RASP constituted ~25% of EVR's market cap; figures from the demerger doc state that RASP reflected 10% /18% / 5% of revenue/EBITDA/debt respectively of the group.

i don't have a scooby on what the relative profit margins of coking coal against steel are, but this suggests to me that steel was driving the profits here not coal, albeit the controlling holding may have deflated the coke output price (and RASP profit) at a consummate benefit to steel input costs for EVR. The way i see it, steel was driving the profits and the divvys and commodity demand swings aside don't see that changing.

Have to agree with the Abromovich posts - why would you leave a tax haven, also historically notoriously uncooperative and secretive, to bring it home to Russia? Obviously to avoid sanction freezing (doubt it could have been freezed where previously domiciled anyway) but does he get on with Putin? If he does, the worrying conclusion for me is 'nationalisation', dressed up as a delisting from London at a low ball price, by the concert parties controlling interest.

paul2566; i like your mix, like your philosophy; i like MNG and think there are few better to be over proportioned on! The soundness of your strategy is reflected in your posts.

Consistently stated my preference for divvys over buybacks and the recent announcement only compounds my preference for the former. Most here appreciate the value/opportunity - and the risk. I want to deleverage the latter not concentrate it.

Frankly, beyond maintaining funds to operate/meet commitments for a year, (presuming no income in that year), i'd be paying every excess penny out the door right now. If it goes Pete Tong i haven't lost all my cake.

I'm more interested in hearing wether SEPL are getting the onshore assets......on there own one would think to big a chunk to buy (although immediatelyearnings accretive), but when one considers the dshareholder base, there are both bigger pockets and localised interests to do such. Just surprised at the no news on this.

Be interested to hear investors views on whether this would be good/bad/ugly/nutural if they were to get it.

Either way, still thinking it's throwing off cash, still think fluctuations aside, this will buy a few bottles of prossecco...

repression: i don't agree with your point:

"Well, it’s fallen below 1st possible support, 208 around 50 ema, I suppose 200p would be next most obvious support it being a round number. Maybe they need to come up with some other strategy other offering massive dividends if the price is just going to fall disproportionately to it and negate any gains. Seems a joke really."

Whilst some very very long term holders are still sitting on loses, anyone invested in the last 2years wil be on a 25%+ SP gain, irrespective of fluctuations around divis, AND disregarding of divvis.

In the absence of a stable supportive govt environment (do they have that?) why would you pursue a 'different' strategy, say of growth rather than getting every profit out at every opportunity. In paying out these wonderful dividends, holders can either reinvest or use to diversify; as the SP is already undervalued compared to what pursuing no further/different strategy, what doing nothing except carrying on to depletion offers, there is no negating, over than temporary, only appreciation.

rbeekeeper; FAIR is not that unsual although not common; if you are diverting to income, and not withstanding concentrating/overweighting your portfolio, similar considerations might be TORO, BGLF, MPLS.

But i do highlight they are all in that same specialised arena, so if FAIR was to see a detriment they would all follow; my personal opinion is, despite the very specialised/technical arena they operate in, all of these are very well, and to me, slightly conservatively, run. Hope this helps, no advice and all that guff etc!

rkbeekeeper/temple of doom;

couldn't agree more - one of those boringly enriching investments; i don't think there is many pi's here but glad to see i'm not alone!

Some good posts below. My penny's worth....

This share price does get very affected by traders especially around divis; the last couple of years, it has risen 15%ish into the divy and dropped 20% after, taking 6 months to equalise; frankly you can trade it, and make a margin, but if you are here for a sustainable decent dividend, ignore the traders impact - the price ultimately stays the same, whilst throwing off a healthy divvy.

As has been said, the rule changes on treating old/new customers the same in reality have a neutral effect, as all insurers are subject to the same rules; personally i don't think it has had a negative impact on DLG (or competitors) judging by the consumer bodies observations that in actuality this requirement has raised the baseline price for ALL rather than reduced for new.

Fundamentally this is a boringly secure decent divvy provider, which will move up and down 15% without never really lighting the firework. It will however continue to provide a decent steak, and a nice single malt twice yearly for your BBQ. A special dividend might provide champagne.

As for being 7.2% of your portfolio (suggesting overweight - poster comment/financial 'experts' generally saying a max of 5), i say well done; wish i was overweight in DLG - if you ignore the fluctuations, focus on it's solidity and divvis, best nights sleep you are going to get this....

johhny gee; i use ajbell and lose nothing in my SIPP

gavster NBC; yes good question, what came from coal? In the demerger doc it states that 10% of $9.8 bill revenue, 18% of EBITDA of $2.2 bill and 5% debt from $3.3 bill related to coal - not sure how this crunches out to profit/divvy contribution.....

golden temple: Respect to you for your response.

What you have missed, in say not researching yourself more, you more than make up for in honesty. Whilst this may not be the quick buck you expected/hoped for Evraz IS undervalued, IS profitable, IS a great dividend payer, IS a great investment - you'll just have to be patient. And that might be a year or 18 months.

You've learnt a lot very quickly through your purchase of EVR - a lesson reading your response which bodes well for your investing in the long term, your future.

Many people, myself included, do what you did. Saw what appeared an undervalued high yielding share mentioned somewhere (it's what drew me to EVR 4 years ago); if you see such again, as an absolute minimum, before investing ANY money, go to the companies latest market updates/annual accounts/quarterly results, and go back a few to get an understanding of where the company has been/is going; if your good with figures you can work out whether the Co is really profitable sustainably and just unloved/undervalued/missed or just being punted in the wind by someone who has no better insight than you or me.

Yes be patient - you'll do reet.

davidspecally; I don't think various posters have suggested SP drop due to demerger - i have. To give some examples, when Tesco sold it's Asian business, and returned a large chunk to investors, the share dropped almost identically the day after; FGP returned capital recently, and the price barely changed. In both these instances people knew how much they were getting and crucially in a month. Here, that lack of transparency/timeline especially having to wait 6 months + has, in MY opinion, made investors assess the certainty of the money in the bank NOW against 6 months, thus precipitating early the usual post dividend/demerger adjustment. Also some investors (like me) liked the coal assets of EVR, and the inability to share in them going forward will have caused some to reassess the whole of EVR; yes the Ukraine has unbdoubtedly impacted this downwards but that has merely added to/confused the drop rather than being the primary cause.

"With regard to the value of the RASP shares......" I think you are being a bit pedantic here. The £1.90 is a guideline so we don't get bogged down in detail; as you say a number of factors (coal price/demand for RASP shares/currency rates/taxes etc) could affect it, but £1.90 wont be far away.

golden templeread your last post with some concern; this site is about shares/companies/investing, but had to respond.
I'm sorry your investment in EVR has made you depressed. Truly. But i don't think you should be, and i think you should put this in context.

Firstly with regard to your 'investment'. Why did you choose Evraz? Why did you choose to put your entire life savings into just Evraz? What 'experts' did you follow? What knowledge of EVR, what research did you do before your investment? I note you have only ever commented, from recently joining, on this one share, which suggests to me, you only have this share, and put your life savings in, frankly allured by what seemed like free money (the RASP coal spin off), without realising little is truly free. That free money was already imbedded in the EVR share price - if i have a cake and give a quarter away, then the cake i still have is smaller. But as the cake is just being cut up, you still have the whole cake, just now 75% of it is in EVR and 25% of it will come back (at some point before October) as cash cake from the coal sale. You still have the same cake, just cut up differently. I don't want to appear harsh, but frankly you are not going to die for the loss of £12,000 - mainly because £12,000 is hardly going to give you a life worth living. That you put all your money in one share suggests either naivety/stupidity or greed. If i had £12,000 ONLY but wanted to chase a winner/free money, i'd of only put a £1,000 in, grateful for a bonus, whilst mindful it doesn't work out, i've not lost my shirt, affected my wellbeing as i still have most of my money. I don't intend to appear harsh but your actions have precipitated your situation.

Secondly, the loss your stating is really a loss of that level; as other useful posts have suggested here, if one takes you bought at £6 and it settles at £4, you've lost £4,000. your 2000 shares are going to give about £3,800 cash once RASP coal is listed/sold. Usually when a dividend is paid (lets call the RASP coal split a dividend for ease), the share price will drop in one day, the day after. So if your share is a £1 paying a 10p dividned, the day after it will drop to 90p; in Evraz's case, the drop has not happened on one day but over a month, as UK investors have sold, unhappy at having to wait possibly up to 6 months for the divvy (money) believing money NOW is better. For me this is quite unusual, but in this case understandable. Personally i think this is the main driver in the share price dropping, not helped by Ukraine concerns. But to give you hope, and aid your wellbeing, in the last 4 years my holding in Evraz has halved and doubled twice - it just does that as do other resource companies (Ferrexpo was rightly mentioned in a previous post). i never sold, because i did my research on the company and market, and believed in it's profit generation, and enjoyed dividend returns averaging 15% along the way.

Yes your down, but your not

johhnygee; some great observations/thoughts there. Thanks.

I think your thoughts on ARO liability are valid ones, and thoughts that REQUIRE serious consideration by anyone (including me) that believes in DEC, in context of its progress and prospects. The number you suggest does indeed sound scary, but the most recent co announcement on well ARO said they were done at $19k which makes it slightly less scary!

The boss man did recently discuss the market/opportunity for taking on new wells, and his view was actually purchase opportunities weren't drying up but opening up, as originators move on to new ground post optimum (but not depleted) output. From the majors, we are seeing a dwindling of new projects on ESG grounds, and personally i am for a more green energy but within that desire is the reality that at an absolute minimum we are going to need the dirty stuff for 20 years, and i agree more likely 50 years to bridge that transition. So from a historical perspective new production will dwindle, but there will still be sufficient to supply DEC with offcasts for 20+ years.

Yes, astute point that they need to continue to acquire to maintain the divvy, as is your suggestion that if they don't do so, the divvys and the market cap will diminish/disappear. I also agree that the sp won't deviate much outwith your 100-110 range.

Aside, i'm a big fan of DEC, the boss man, the niche it is in, it's steady but sure way. Whilst i have long been quite green, I'm sceptical of the current ESG preponderance of pension funds/institutional investors purely because i believe we need to use the dirty to enable the transition to clean, and we cant do that in a day or a decade. I actually find DEC a positive in that ESG space, because, if they were not milking less than prime wells and then capping them, someone else would without capping, or noone would with no capping- a sort of best evil if you like.

My runout is 10 years, i think the production/divvys will be safe for then; thereafter i think there will be diminishing returns.

there is more chance of seeing 198 than 98 this year......

goldentemple: optimism undimmed! And i feel your pain - i added 500 on Xmas Eve at 610 so you id 'better' than me.

I've been here before - about 18 months ago it drifted down incessantly, and at one point was on a£5 grand loss; never sold a share then, and won't be now. The manner of the split is a **** up from a UK investor perspective, and the Ukraine is a camel's straw at the moment, but the world needs EVR steel.

Whilst i must confess surprise at the depth of the drop, my undented optimism is based on the long term economics of EVR's product, not transient short term political posturing.*

*(The Ukraine situation greatly concerns me societally but not fiscally with regard to EVR).