P2p Global Investments Share Discussion Threads

[n3tleylucas] 01/6/2014 10:03

Clearly the 15% performance fee is a big negative, as is the current 8.6% premium (current ask of 1070p)) to the IPO 985p NAV. If 6% is paid on 985p on an annual basis then 5.5% is the yield @1070. That's not much above TSCO, SBRY and GSK.

Hardly enticing with base rates due to rise.

[jimbo55] 01/6/2014 07:12

Does anybody think it's a bit of a cheek for this trust to be levying a performance fee at 15% of any gains?



As somebody who has been an active investor in Funding Circle loans pretty much since inception, I certainly do. Anybody can create a Ratesetter account aswell, and the management of this is pretty much a hands-off affair. What is this trust doing that makes them think it's special enough to levy 15% of any gains?!

[wirralowl] 31/5/2014 15:33

Was thinking similar, VHM.

In addition to the premium to NAV, presumably the payment of dividends will only take place once the funds are deployed? In the meantime we may well see the start of interest rate rises, and how that affects the P2P market is a bit of an unknown.

[verymaryhinge] 30/5/2014 18:47

someone explain why this won't go to a discount to NAV, especially as it will talk time to get the cash deployed.

interested, but not at a premium to NAV

[jaws6] 30/5/2014 12:46

1040 to 1070 now

[jaws6] 30/5/2014 11:01

auction cross at 1050 for 90019 still they want to buy 22381 at 1050
and 25000 at 1040 p in auction

[skinny] 30/5/2014 10:45

P2P Global Investments PLC is pleased to announce that its ordinary share capital consisting of 20,000,000 ordinary shares are expected to be admitted to the premium listing segment of the Official List of the UK Listing Authority, and to trading on the London Stock Exchange's main market for listed securities, at 8.00am today under the ticker "P2P".

[davebowler] 29/5/2014 18:06

P2P's £200m funds will be invested via U.K.European and U.S. Peer to Peer lenders and about 5% in equity and warrants in its favoured lending platforms
Here is Midas Stockbrokers slant;
........................................................................

"retail banks are dinosaurs" Bill Gates

"Banking is very digitisable... Lending Club's peer to peer model is changing personal lending" Peter Sands, CEO of Standard Chartered.

P2P Global Investments ("P has announced its intention to apply for admission of its ordinary shares ("Shares") to the premium listing segment of the Official List of the UK Listing Authority and to trading on the main market for listed securities of the LoP")ndon Stock Exchange (together, "Admission").

I am sure you are all aware that banks are valued at multiples of book value (roe –g/coe-g). Most banks earn a return on equity of between 10 per cent and 15 per cent and trade on 1.2x to 1.8x book value. So imagine you were offered a peer to peer fund with a forecast return on equity of >10 per cent at 1x book... with a forecast dividend yield of over 8 per cent. Beyond the aforementioned, the fund is being managed by the blue chip house Marshall Wace.

We are pleased to announce that Midas Investment Management Limited have been appointed as an intermediary for the forthcoming of P2P Global Investments which we think is an attractive offer for the following reasons:

· Compelling economics - floating at ~1x book with a forecast ROE of ~10 per cent on modest leverage ratios.

· Structure - expected to be ISA & SIPP eligible, expected 0 per cent corporation tax, diversified by platform, geography and loan type.

· Attractive yield - potential dividend yield of ~8 per cent in 2015, superior to listed comparable debt investment funds (average of debt fund group ~5 per cent yield).

· Strong historical performance of P2P lending - historic low volatility of returns, strong risk/reward metrics (Sharpe ratio), average industry yields of >8 per cent net of loan losses.

· Potential for alpha generation - based on beneficial fee agreements with platforms and proprietary loan selection technology.

· Low volatility of loans - expected annual loans losses of ~3.2 per cent.

· Precedent - these type of funds have done very well in the USA especially the Eaglewood fund which returned 16.2 per cent last year.

· Access to Lending Club for non USA citizens - arguably Lending Club is the platform providing the best returns yet only USA citizens can access it.

Banking sector implications

The lending function of developed market retail banking is going to change and the peer to peer platforms and vehicles are the players that should benefit. Please re-read what Peter Sands has said above. We advise clients to consider selling all their banking shares (excluding Standard Chartered and HSBC) and repositioning into these industry changing catalyst. There are two reasons the banks are in trouble:

1. P2P platforms have a cost base ~60 per cent lower than banks; and

2. The interest spread banks charge is ~4.2 per cent whereas P2P's has a spread of ~2.0 per cent.

People will start to understand that depositing money with banks and borrowing from the banks is not the best value for money route. Liberum estimate that by 2024 US and UK P2P platforms will increase to £292bn which is roughly 20 per cent of all lending. How will the banks then cover their fixed costs?

Our conclusion

This is a game changing, sector smashing investment. We think this investment is a far superior, risk adjusted investment proposition to buying life insurance or bank shares and we also see it as a very compelling alternative to depositing your money at the bank. After all, how are the risks dissimilar? Yet the returns are stratospherically different.