The share buybacks don't seem to be having much effect on the shareprice ? |
@makinbucks There are different kinds of PE strategies. Not all of them require "significantly grow revenue and EBITDA" or indeed high levels of debt.
What shouldn't be a debate is that an investment trust is required to distribute a high % of the income it declares - I believe it's 85%. So if Apax is making capital gains and receiving dividends, then these must be mostly distributed to shareholders. That doesn't preclude an IT from having uncovered dividends, but even then that's a sign of confidence as no company or IT wants to reduce dividends.
And for a fund targetting mid-teens returns, a 8% "natural yield" is certainly the minimum to be expected from a mature, cash-generating portfolio. |
@SKYSHIP - Have replied to your DM |
craigso, I think that is misguided. PE investors look for companies that can significantly grow revenue and EBITA. To allow that to happen they gear the investee companies. Cash flow generated services the debt and funds the growth, dividends restrict the growth opportunity. After a period of growth the PE investor sells the asset for a capital gain. If a PE IT is paying a dividend it is doing so to smooth the distribution of the capital gains. Whether this is good practice or not is a debate.
Apax is different, unique in fact, in that alongside the PE it has the debt and equity
derivatives portfolio which is there to provide liquidity and income. That gives it a natural yield which other PE IT's don't have but lets not kid ourselves that there is an 8% natural yield |
Message for speedsgh.
--------------------
Hi there - a request. Would you mind updating the Header of your ASLI thread.
You seem to have moved on; and perhaps now have no interest.
If so, I will start a new thread with updated Header info re the wind-up and showing 27/09 Interims.
Would prefer you update; or provide permission for me to proceed. |
Another I've been watching for a while and bought in today. Think we will see quite a move once we break the downtrend and happy to receive the very attractive dividend in the meantime :) |
There are many private equity type investment trusts trading on these sorts of discounts. Sooner or later the discounts will narrow.
I'm not really able to judge which PE ITs are better than others - I'm certainly not going to chase recent winners under the assumption that they are "better" - but the one confident enough to give me an 8% yield (+ more via buyback) is certainly worth holding. |
speedsgh, same as yourself. I have it as a diversifier within a balanced portfolio. With the share buybacks, the discount should narrow and an 11p fixed dividend provides a good yield. Personally, I can't fully explain why the share price has been sliding over the past 3 years but am happy to have had the opportunity to buy at current levels. |
Performance the last 3 years has been disappointing but prior to that performance since listing wasn't bad. I'm inclined to think the share price is nearer the bottom and am therefore happy to stick with them and collect the dividends until their performance & rating have improved. |
Very interesting, thanks. They could be sat on it for a long time tho, APAX been a serial underperformer. |
"That’s left them [APAX] on a 33% discount to their net asset value of 213p in June, which has ‘disappointed’ long-standing backer James Hart. As the former investment director of Witan Investment Trust, Hart admired Apax Partners and took a cornerstone stake when the investment company floated.
Following Witan’s merger this month with rival Alliance Trust, Hart has joined its fund manager Willis Towers Watson. The 5% stake in Apax has transferred to the now £5bn Alliance Witan (ALW) and although it does not fit its investment strategy, Hart said it ‘will not be sold until we have realised full value for Alliance Witan shareholders.’
That’s good for Apax. If Alliance Witan is not a forced seller, it should remove any ‘overhang̵7; weighing on the shares." |
Private equity is picking up: Buy this ‘hidden gem’ -
This is a version of an article published today in the Telegraph’s Questor column... |
Tipped by Questor in the Telegraph today. |
24m shares could only be sold off via a placing, even if the combined group wanted to do so, which is unlikely IMO. |
Doing some research today... Picked up that Witan Investment Trust owns more than 5% of Apax Global Alpha.
Now that Witan is merging with Alliance Trust, there may be some concern that Witan's Investment Trust holdings will be sold off. |
Looking at the chart, there has been an almost continuous slide over the last 3 years. When the rest of the market has been growing, that suggests deep issues. I can't spot anything significant. What am I missing? |
Nice dividend received today at least ... |
Like an ingenu, waiting to be fleeced, I took a few at just under 136p. Looks reasonable value assuming there's no nasties in the offing that we're unaware of(imagine that!)) |
Frustrating to see this trickle downwards...
But we're still getting our 8% yield and the cheaper the share price, the more NAV accretive the share buybacks. It's just one of those ITs we need to be patient with and ignore the day-to-day... |
Well it's divi day tomorrow so may rise a bit on reinvestments? |
Cheap at 135'ish pence? Cheap-but there's a good reason for it? Or, don't be so daft CWA1, it's not cheap at all, what are you havering about?!
Any views welcomed :-) |
Thanks for your feedback - I'm planning to double my holding here to get some more private equity exposure (I like the dividend payouts too) but must say I don't fully understand the business ... |
Can't explain though a rising tide should lift all boats eventually. That's my hope. BPT has had upgrades recently whilst Apax took a small hit on one of its holdings. Looks a real bargain to me in the 140s ..but who knows. |
Why has Bridgepoint virtually doubled from the lows but shareprice here remains in the doldrums ? |
XD this morning in case anyone was wondering. Pay day is 3/10 |
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