Canadian General Investm... Share Discussion Threads

[quepassa] 05/4/2024 06:24

Yesterday's RNS details a stunning benchmark-beating performance over the last year by CGI.


Outperformance against Benchmark:-

+13.4% performance vs +6.6% benchmark (NAV)

+22.2% performance vs +14% benchmark (NAV plus dividends reinvested)


"TORONTO, CANADA - Canadian General Investments, Limited (CGI) reports on an unaudited basis that its net asset value per share (NAV) at March 31, 2024 was $62.80, resulting in year-to-date and 12-month NAV returns, with dividends reinvested, of 13.4% and 22.2%, respectively. These compare with the 6.6% and 14.0% returns of the benchmark S&P/TSX Composite Index on a total return basis for the same periods."


See RNS for full details including up-to-date composition of Top-Ten holdings.


With such exceptional performance, this is another strong reason in my view why the unusually large current Discount-to-NAV is an anomaly , overdue for compression and for reversion to mean.

all imo. dyor.
qp

[quepassa] 02/4/2024 09:52

They are not . They are very much aligned in my view.

I have seen this comment before that it's a family run thing but wholly disagree.

Look at the heritage and time-line of the Trust and the Managers:-

hXXps://www.mmainvestments.com/who-we-are/our-heritage

Look at the track record of CGI:-

hXXps://www.mmainvestments.com/closed-end-funds/overview


I see nothing there which in any way suggests it's a personal vehicle.

Deeply undervalued in my view at the abnormally large Discount-to-NAV.

ALL IMO. DYOR.
QP

[bagpuss67] 02/4/2024 08:33

Morning. How are the interests of the family misaligned with smaller holders? Genuine question....

[irb2] 02/4/2024 06:45

Dr Biotech summarised the issues well.

Seems to be a personal vehicle managed by the largest shareholders family office effectively.

Canadian law precludesshare buy backs as a discount management measure - does anyone know if they can do a tender offer? Even letting holders out at 5% discount to NAV implies a big uplift currently.

[davebowler] 25/3/2024 15:02

Irresistible Discount to NAV and a good backdoor way into the US.If I could only bring myself to plunge in!My focus on Value has led me here.Its not served me that well over the last few years but I assume we have been through such extreme times that the recently ineffective strategy will start to come good any time soon!

[skyship] 11/3/2024 13:39

Now at 40.2%

Under Canadian regs they can't undertake buybacks without being forced into a full bid. They can however make a large Special dividend.

[skyship] 07/3/2024 16:13

NAV marches on and the discount now officially at 40%!

[weatherman] 06/3/2024 08:40

NVIDIA is their largest holding.

[skyship] 25/2/2024 13:28

Personally I feel they are right to take some Nvidia money off the table whenever the holding approaches 10%

[1c3479z] 25/2/2024 13:00

relatively costly trust in terms of annual management charges,
had to cut back the Nvidia position in late 2023 at the Board's instigation to manage the exposure that was getting near to 10%. In retrospect, it would have been much better to let it run,
at a very wide Hansa-like and Private Equity Trust discount,
should be good value but what is the dividend situation for a uk holder?

[skyship] 23/2/2024 10:36

Indeed - Nvidia up 16% last night - so bought back in for a few this morning. 2103p = C$35.94 v. the Canadian share price of C$36.69.

[tiltonboy] 22/2/2024 15:35

Discount out at 39% now.

NVidia position should help the NAV

[skyship] 10/1/2024 11:44

Simon Thompson (IC) also tipped it last year - I recall posting on the fact when he did so.

[dr biotech] 10/1/2024 10:19

I've watched this fund on and off for the last several years. Performance is decent enough and its currently a big discount, even by their wide standards. The problem appears to be that

1) This fund seems to be run for benefit of the Morgans (private individuals) who own more than 50%

2) Under Canadian law they can not buy their own shares, so no obvious way to tighten the discount to NAV

3) Its a fairly large buy/sell spread. Unless you can buy directly on the Toronto exchange which may not be so good.

Searching google news brings up a few positive articles about it - seem to recall it was tipped in the telegraph some time back too. Decent long term hold, but not one for short timelines.

[quepassa] 10/1/2024 07:48

Well-structured top ten portfolio:-

The top ten investments which comprised 36.6% of the investment portfolio at market as of December 31, 2023 were as follows:


NVIDIA Corporation 4.7%
TFI International Inc. 4.7%
Canadian Pacific Kansas City Limited 4.5%
Apple Inc. 3.7%
West Fraser Timber Co. Ltd. 3.5%
The Descartes Systems Group Inc. 3.3%
WSP Global Inc. 3.3%
Franco-Nevada Corporation 3.2%
Mastercard Incorporated 3.0%
Bank of Montreal 2.7%

[quepassa] 10/1/2024 07:23

Very good point.

There is no simple answer.

It's easy to understand why funds which are invested in illiquid assets -which are hard to value and to realise- rightly deserve to trade at a significant discount to NAV(the so-called illiquidity premium).

But when you have a big fund like this in liquid assets with a strong manager and reasonable fees, the gaping discount is a conundrum - especially when the discount has blown out to levels wider than historical mean.

On the bright side, when the discount has blown out, as an investor/buyer you stand the chance of benefiting not just from the underlying performance of the portfolio but also hopefully/likely from the tightening of the disproportionate discount as it reverts to mean.

all imo. dyor.
qp

[bagpuss67] 10/1/2024 07:06

I don't underatand how trusts with a large listed holding trade at such a discount. Sorry naive question but why can't they recycle their listed holdings? I suppose the discount is attributed to other holdings or something in the structure?

[quepassa] 10/1/2024 06:53

Given the

-track-record,
-pedigree of management company,
-undoubted dividend history,
-size and liquidity,


the Discount-to-NAV has always seemed a bit of an anomaly to me.

all imo. dyor.
qp

[bagpuss67] 09/1/2024 20:53

Thanks...Think I will have a bit of a top up...

[tiltonboy] 09/1/2024 20:46

Indeed, but there is a perpetually wide discount on this trust despite impressive long term performance. Admittedly this is the widest it’s been for a long time. Normally trades in a range of 28-33

[bagpuss67] 09/1/2024 19:53

Is that correct 38% discount??

[wmb194] 06/12/2023 18:41

You should have quoted it, it was probably just plain incorrect. Will Barclays allow you to buy it again?

[weatherman] 06/12/2023 17:16

Barclays now removed the note after budget statement.

[weatherman] 02/11/2023 19:03

There is a note on Barclays to this effect - maybe anticipating changes.