Best market for specialist insurance in decades and MGAs with capacity behind them are in prime position for the upside; taking a % of premium, taking no underwriting risk, is a great business model to have when prices are rising. Plus more and more new capital turning up in the market who will need distribution.
Lots of upside here; the stake in Nexus alone could be worth close to the current market cap. Kicking myself I didn't get in sub 200p but sub 300p is still good value I believe. Might be a 3-5 year time horizon for realisation however so only for the patient. |
That's right they are mostly MGAs/brokers so they won't be taking insurance risk on to their balance sheets. I personally prefer an investment company to focus on the sectors they know really well, rather than a more generalist approach, so fine with the heavy insurance weighting. |
Thank you for the comments.
Insurance is an exciting business but I don’t think any of the investees are underwriters. So is quite safe although all in insurance. So yes concentrated in what they know best.
Surely if Marsh died, (God bless him) and the management twiddled their thumbs the investments would continue to grow. However, they have many future investments prospects which is an additional compounding growth factor.
I think growth is compounding starting at 5% and now up to 12%
I hope the dividend will be restored.
With any luck, if there is sufficient buying at this level, Marsh can unload some of his shares then the company can buy back shares? |
The update itself sounded very promising. Nexus in particular seeing rapid growth and very much the jewel in the crown. From memory this makes up 30% of the portfolio. Would expect this to IPO at some point at a potentially good uplift. The rest of the portfolio is mostly in other MGAs and insurance brokers so really well placed to benefit from the hardening insurance market, which many say is the best they've seen in 2 decades. |
They could do a buy back if he sold some shares to maintain his %. I believe there are also AIM restrictions relating to the T/O of minimally traded shares which then restricts the number of shares which can be repurchased. ie danger of a false market or ramping the price. Don't forget that the law was changed comparatively recently to allow companies to buy their own shares. It used to be illegal. |
Maybe they want it out there that they would if they could! Or they see advantage in indicating that BPM could take it private. Bait for Private Equity investors?
What is certain is that the RNS has a purpose.... |
 Incidentally, can anyone make any sense of this extract from today's RNS?
If they can't buyback, why have the strategy to do so? If they can't buyback, how did they manage to do so in 2019?
================================
Share Buy-Backs
As has been stated previously, the Group has a strategy for undertaking small market buy-backs of its shares at times when the discount to Net Asset Value ("NAV"), based upon the most recently announced NAV, is greater than 15%.
For the avoidance of doubt, notwithstanding that the discount to NAV at which the Group's shares are currently trading is greater than 15%, the Group repeats that it is currently restricted in its ability to buy back shares since, given that Brian Marsh, together with persons acting in concert with Brian Marsh for the purposes of the City Code on Takeovers and Mergers (the "City Code"), has an interest in approximately 41.85% of the Group's voting rights, any such purchase of shares would result in an obligation for Brian Marsh to make a general offer for the Group in accordance with Rule 9 of the City Code. |
On balance I feel more comfortable with ocl for value/spread of risk |
riverman - agreed - 31%. Sorry, I was just quoting back the figure tresham had stated. Should have checked the figure in his statement first. Mea Culpa. |
The other problem is that because of the worldwide nature of the investments which require more time to log their results together with the lag in insurance returns, all the information they provide is typically six months old. BPM confirmed this to me at an AGM some years ago. |
This is on a 30% discount, versus a typical discount of 15-20% so looks good value in my view. The previous posters should check their maths. |
tresham - where to begin?
# Brian Marsh is the controlling shareholder with over 50% of the equity; and has no interest in paying out dividends to outside shareholders, therefore:
# The yield is a paltry 0.8%; and still only 1.7% on a fully restored dividend
# A 20% discount is about the average for PE trusts
# The long-term growth back to 2005 is c7.4%pa compound. Only in the recent 3yrs have they managed to get up to the average PE trust levels
# Without Simon Thompson's constant tipping in the Investors Chronicle, these would likely be 15% lower |
Maybe some nervousness about all eggs in insurance basket, and surely 20% discount not abnormal for a private equity portfolio. Plus age of the eponymous Mr Marsh. |
I think I must be the only buyer! This company's investments on average are growing at 20% and there is an over 20% discount to net asset value. It is well diversified and seems safe. I invite anyone to explain why it is so unloved. |
305030
Pardon my ignorance.
What is NFC financial planning? |
nice to see the rise today, though IMHO a little odd correlation to the RNS
ATC was last valued at c.7m so even a 50% increase is only 3m (c.2%) onto BPM NAV.
Still it is the latest of 'information' RNS where they dont say much other than highlight the good performance with their underlying investments.
the 2 most material investments are Nexus 40m + NFC financial planning 35m.
an interesting presentation yesterday from TAT and also TU from QLT today,
as well as other recent sector news bodes very well for NFC.
and BPM couldn't have been more positive about the profit forecasts for Nexus last time.
current NAV is 396p and i think a >5% uplift can be expected,
added to this that the company has publically stated that it wants to buy back its own shares and i agree that we';; soon see the price start with a 3 handle.
ALl IMHO, DYOR + BoL
BPM is in my top 5 hldgs |
Usually it's a 10p spread which you can trade inside of by a penny or two so not too bad most of the time. Sometimes goes tighter or wider for short periods. |
spread is 12p.
Horrendous share to trade, but one to hold long term.
R. |
More good news with their investment in ATC. A great share if you can buy them. Perhaps they should be 300p? |
Break of 300p looming large. |
As I've said before it needs some sort of rebrand to make it more exciting. Augmentum fintech fund is on big premium, as it markets itself as an exciting start up fund. I personally think BPM has a better portfolio, but completely under the radar. |
Agree. One day nexus may also be listed giving bpm an out and realising some very significant value. |
a good RNS with further positive developments at Nexus.
What does poor BPM have to do for investors to notice the valued added in its portfolio?
time will tell
All IMHO, DYOR + BoL
BPM is in my portfolio |
Still looking for a break of 300p myself, given next revised nav should sail through 400p. |
Looks left behind , 10% catch up move could easily occur here. |
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