Carador Income Share Discussion Threads

[solarno lopez] 21/3/2013 15:44

So, does one buy at these levels for the yield

[jonwig] 21/3/2013 07:13

I see the NAV has fallen to USD 1.0268, which may have leaked out yesterday.
But income is holding up well and should mean 3.5c is paid.

[dendria] 20/3/2013 19:27

CIFU seems to have drifted back to a more realistic premium to NAV. Feb NAV should be out this Thu/Fri so we should see then.

[dendria] 22/2/2013 18:55

Article in WhatInvestment 22/02/13 (based mainly on Edison update):

[solarno lopez] 22/2/2013 10:51

Jonwig there are a couple of very sensible posters here of which you are one.

I listen carefully to their comments and act accordingly.Their comments are much appreciated.

Thank you

[jonwig] 22/2/2013 10:09

The next dividend should be declared in March, covering the period from 01/01 to 31/03.
The N+1 Singer note above suggests dividends should continue in the range 3.5c to 4.0c.
All the notes above point out that it will become harder to get future returns as strong as those in the past year.
However, on the positive side, they've salted part of their cashflow away to cover cases of default.

The thing to watch out for is rising interest rates, either Fed tightening or USD Libor. This will put more stress on companies who will need to borrow at higher rates and pay more on existing loans.
Paradoxically, strong US economic recovery will have the same effect.
That's unlikely in the near future, but my strategy is to use a trailing stoploss.

You shouldn't really be asking BB posters questions like that, as you're only likely to get the wildly optimistic answer (or, maybe, a wildly pessimistic one from somebody who's sold or is short).
However, I can always be relied on to find a cloud in every silver lining ... whether I'm a "Carador specialist" is a different matter!

[solarno lopez] 22/2/2013 09:21

Can one of you CARADOR specialist please break this information down and give us a simpl,e version...is it a good share to hold and will it maintain its dividend....THANKS

[dendria] 22/2/2013 09:02

New items on the Carador News Page today.



N+1 Singer, 21 February 2013, "Success Brings its Own Issues"
The payment of CLO manager incentive fees and the high rate of loan repricings/repayments have introduced new variables into the CLO equity portfolio income stream. In this note we have adjusted the qualitative assessment of our dividend forecast (no change to actual forecasts) from conservative to central in a relative narrow range of US$3.5¢ to US$4.0¢ per quarter through 2013. The new feature - loan repricings - needs careful monitoring. Loan and CLO markets have started 2013 in the same shape as H2 2012 and the continued rerating drove the Carador NAV up 3.24% underlying in January.
Please contact Ian Wild at N+1 Singer ([phone], [e-mail]) for a copy of this report.


Dexion Capital, Carador Income, 21 February 2013 - January performance, Dexion Comment
The relentless NAV performance has been matched only by share price strength (the share price total return is 7.1% year-to-date). The shares closed yesterday on a premium of 7.6% to the 31 January 2013 NAV. In our opinion, this is high relative to the potential NAV performance following the re-rating of many parts of the portfolio.
Please contact Tom Skinner ([phone], [e-mail]) for a copy of this report.


Liberum Capital, Carador Income Fund, 21 February 2013, January NAV - Liberum View
CIFU has delivered impressive NAV total return since the start of 2012 of c54% driven by the re-rating of CLO income notes and debt tranches. We would not expect this rate of growth to be maintained going forward as many of the investments are now priced closer to par. Strong cashflow generation and an appealing 13.5% dividend yield should continue to support the share price at current levels (7.6% premium). We will keep a close watching brief on future updates for any evidence of lower cashflows from leveraged loan repricing.
Please contact Connor Finn ([phone], [e-mail]) for a copy of this report.

[jonwig] 21/2/2013 09:08

The share price is falling this morning because, I think, the NAV and income statement lacks some explanation (not the first time).

It states net income per USD share in Q4 to 31/10 2012 to be $0.0176, whereas, going back to the 21/11 statement, the 31/10 net income was $0.0226.
The reason is in the small print: the first statement referred to the USD shares alone, not the C shares. These are now consolidated, hence the revision.

This week's Edison note didn't warn of the rebasing. Nor does it anywhere suggest that the dividend may not be maintained, owing to the larger shares base.

[dendria] 18/2/2013 08:52

The Edison research note is out on their website this morning (18 Feb 2013):

[dendria] 17/2/2013 09:46

Edison have published a 12 page updated research note on CIFU (15 Feb 2013). It seems to be only available at Stockopedia (subscription only):



I assume it will appear on the Edison website at a later date.

[atholl91] 14/2/2013 17:13

excellent investment for an ISA with divs re-invested quarterly. Also managed by one of the best CLO teams around who have not delivered bankrupt $7b funds like Cheyne.

[jonwig] 14/2/2013 08:07

'Normal' investment trusts offering a good yield are now generally trading at a premium wherever they are ungeared, and this asset class is beginning to look like a 'new normal', with so-called cautious funds making investments in CIFU!

As pointed out, if you don't suffer currency conversion with every dividend, the forex aspect is currently profitable.

Personally, I'd hold but not add, but that's just me.

[pejaten] 14/2/2013 01:30

rford788, I very much doubt that it will be 12% premium to current net asset value. January was probably a very good month so probably find that it is still 3-4% premium when January net asset value is announced.

[rat attack] 13/2/2013 21:41

watch GBP:USD

[rford788] 13/2/2013 20:00

At 12% premium or so, is this still a buy ? Been thinking of topping up this week but holding back until I have done enough due diligence.

Cheers

[solarno lopez] 13/2/2013 08:11

But still nice to have the support of an Institution

[jonwig] 12/2/2013 18:18

Well, BlackRock Cautious Fund has just announced a holding of 21,450,000 shares (3.94%).

LOL - I suppose we should be ecstatic ... "cautious fund"!

[rat attack] 10/2/2013 17:45

jonwig - thats a very good point.

[jonwig] 10/2/2013 12:07

Of course, ideally you buy when the discount is wide, knowing that it will narrow.
(Except you don't know, you hope.)

And if it narrows do you sell and forego a historic yield on cost of 15%?

In any case, it's a bit misleading to compare an investment company with gearing of 81% (RECI) with one of -4% (CIFU)

rat attack - re. GLIF, it will be interesting to see the way BMS's assets are consolidated into the next set of accounts (goodwill treatment). We haven't been given any hint of this - one of my gripes against GLIF.

[ibarty] 08/2/2013 20:32

12% premium to Dec net asset value but this is likely to reduce significantly when January net asset value announced.

[skyship] 08/2/2013 11:03

....& still c10% discount @ RECI after yet further rises recently!

[rat attack] 08/2/2013 10:30

Also notice that offer price is at a 12% premium to NAV!! Contrasts with a 9% premium at GLIF.

[rat attack] 08/2/2013 10:18

Just received dividend in TD account so only 2 days late this time!! However, when I go to convert to GBP the USD is not recognised:

....You do not have enough funds in the currency you want to convert from...

TD are really poor, quite pathetic really.

[yieldsearch] 07/2/2013 22:11

Fyi, got it today with iweb, converted into gbp at 1.58, ie close to spot fx.Not yet received with tdw