City Of London Investment Share Discussion Threads

[luderitz] 16/1/2020 15:55

Always has had a big spread for some time of the day, be patient and await your time or set a limit order.

[frazboy] 16/1/2020 15:50

Been watching it for the last couple of days, it rarely narrows MRF, you could try a limit order?

[mach100] 15/1/2020 22:44

Thansk Masurenguy. As Mae West used to say "A hard man is good to find."

[masurenguy] 15/1/2020 16:01

Perky markets support dividend hike
15 January 2020: Hardman Corporate Research

City of London has announced a trading update for 2Q’20. At the end of December, FUM had grown to $6.01bn, a 13% increase over the September 2019 figure of $5.34bn. This was driven by healthy market growth and more inflows into the Developed World strategy. A rebound in the exchange rate means a smaller increase in FUM of 5% in sterling terms. The highlight for many investors will be in the increase in the interim dividend of 1p to 10p. While nothing has been said about the full-year dividend, increasing that at the same rate would still leave the five-year rolling dividend cover, on our estimates, above the 1.2x target.

Operations: The increased FUM in the diversifying strategies did not affect the revenue margin, which stayed at 75bps. The strong market performance and good inflows led to an estimated pre-tax profit of £6.3m, which was a little ahead of our forecast.

Performance: Each of the Emerging Market, Developed Market and Opportunistic Value strategies outperformed, with NAV performance and discount narrowing being a factor in each. Frontier underperformed, with country allocation and discount widening both being factors.

Valuation: The 2020E P/E of 10.5x is at a significant discount to the peer group. The underlying 2020E yield of 6.6% is attractive, in our view, and should, at the very least, provide support for the shares in the current markets.

Risks: Although emerging markets can be volatile, City of London has proved to be more robust than some other EM fund managers, aided by its good performance and strong client servicing. Further EM volatility could raise the risk of such outflows, although increasing diversification is also mitigating this.

Investment summary: Having shown robust performance in challenging market conditions, City of London is now reaping the benefits in a more supportive environment. The valuation remains reasonable. FY’17 and FY’18 both saw dividend increases and, unless there is significant market disruption, more should follow in the next few years.

[skinny] 15/1/2020 13:24

It IS worth listening to the interview.

[riverman77] 15/1/2020 13:21

This could be due a re-rating in my view. It has previously been quite lowly rated, reflecting the fact that it was pretty much a single EM strategy which was at full capacity. We are now seeing strong performance and inflows to the DM strategy, and they have also launched a REIT strategy. Better diversification and fewer capacity constraints should attract an higher multiple.

[skinny] 15/1/2020 13:00

Or in Masurenguy's link in post 2347.

[stun12] 15/1/2020 12:58

monty, looks lie it was an interview and is available at

[montyhedge] 15/1/2020 12:39

Can any one post the write up from Zeus?

[skinny] 15/1/2020 11:28

I refer you to post 2342. :-)

[my retirement fund] 15/1/2020 11:27

Def a new high

[skinny] 15/1/2020 10:59

Thanks for the link.

Another few pence and I'll have doubled my purchase price - not a consideration at the time!

[masurenguy] 15/1/2020 10:42

City of London Investment Group ‘a 12% annual return for many years’ says Zeus Analyst

[luderitz] 15/1/2020 00:18

Oh really, I’ll believe that if and when it happens.

[eggbaconandbubble] 14/1/2020 11:59

Retirement Fund. Just between you and me. Brexit has been sorted. we're 'Brexiting' in two weeks!!!! lol!

[nobbyx] 14/1/2020 11:51

CLIG is probably one of the LSE companies least likely to be affected by Brexit.

[my retirement fund] 14/1/2020 11:04

I'd love to load up here but a decent valuation is never likely to occur with a listing on the British stock exchange with the never ending brexit saga

[skinny] 14/1/2020 11:00

465 the high on 16/12/2010 and 470 on 15/12/2020!

All looking healthy though.

[masurenguy] 14/1/2020 10:57

Two trades went through @464p earlier this morning !

[skinny] 14/1/2020 10:51

I hate to be pedantic, but the price has been higher (just) :-

15/12/2010 455.25 470.00 455.25 460.00
16/12/2010 465.00 465.00 460.00 461.50
17/12/2010 463.00 463.00 448.25 455.00



Hence my post 2335 :-)

[masurenguy] 14/1/2020 10:47

Shares just hit an ATH this morning ! :o)
Could see Barry Olliff dispose of a further 500,000 shares as we've hit his next threshold of 450p.

[2wild] 14/1/2020 10:22

Profits up 21% interim div up 11.11% to 10p. Assuming 20p final Dividend, share price of 500p would give a solid well covered 6% yield and 600p 5%. Although Barry Olliff is looking to offload 750,000 shares in 3 tranches at 450, 475 and 500, i think it will be quite easy to place these. Got a few at 457p this morning.

[topvest] 14/1/2020 10:15

I suspect Barry will be selling a few more now that 450p has been reached.

[davebowler] 14/1/2020 09:05

Zeus;
FuM leaps to over $6bn
What’s new: The trading update for the 6 months to 31 December 2019 released this morning reveals:

§ CLIG’s Funds Under Management (“FUM”) rose 11.6% to US$6,014m; Sterling strengthened 3.9% against the US dollar to £1 = US$1.32 and
Emerging Market Index (MXEF) rose 5.7% to 1,115.

§ CLIG’s Emerging Market, International Developed and Opportunistic Value strategies outperformed with good NAV performance and narrowing discounts.

§ US$182m of net inflows in the past 6 months: US$272m net inflows to Developed strategies, US$20m to Opportunistic Value funds and US$118m net outflows from Emerging Market funds: notifications of circa US$200m of net inflows expected to fund over the next quarter.

§ Estimate of 1H PBT of £6.3m (21.2% up on 6m to Dec 2018: £5.2m).

§ Interim DPS will be increased by 1p to 10p.

Interim results will be published on Monday 17 February.

Zeus View: These interims show the success of CLIG’s Diversification strategies (i.e. non-Emerging Market funds). Over the past two years, its Diversification FUM increased 150% and its contribution to group FUM risen from 13% to 26%.

We take this opportunity to refine our forecasts using the following assumptions:

§ Financial markets and exchange rates remain at December 2019 levels.

§ The 5% EIP charge assumed for FY20E is not repeated in FY21E.

§ DPS nudged up 1p reflecting the interim DPS and strong net cash position.

Consequently, we leave our FY(Jun)20E profit, and EPS forecasts unchanged and nudge up our FY(Jun)21E profit, and EPS forecasts by c 8%.

Valuation: Over the past decade CLIG has delivered its shareholders over 12% pa total return, split 50:50 into capital return and dividend income. Diversification is creating shareholder value, delivering stability and growth in FUM, earnings and in turn valuation multiples.

At 504p (14.5% above its current price), CLIG’s PER multiple of 13.0x would be less than the equity market and its dividend yield an attractive 5.5%.