Diversified Energy Share Discussion Threads

[skinny] 26/2/2024 15:08

I see the downmarker is on their toes today!

[scrwal] 26/2/2024 15:07

Fordtin - I have never shorted anything in my entire life. I'm not interpreting anything as it is in black and white that the Tender Offer is conditional on several factors one of which is the Tender Price not being less than £9.35 which is a fact.
To imply otherwise is stupid.

[bluemango] 26/2/2024 15:06

People have had days/weeks to buy ahead of ex-div, and at far lower prices than this. FWIW, I think this is something else.

[skinny] 26/2/2024 15:01

Ahead of the ex dividend on Thursday perhaps.

[tsmith2] 26/2/2024 14:59

moving up nicely..

[neilyb675] 26/2/2024 13:46

947.00 - 949.00 (GBX) at 13:43:19
on Market (LSE)

[fordtin] 26/2/2024 13:43

scrwal - re "This is a conditional statement which implies that if the Tender Price were to be lower than £9.35 then the Tender Offer fails"

Yeah, I can see that's how a short-seller might want to interpet it.

[scrwal] 26/2/2024 13:00

Fordtin "e) the Tender Price per Share not being less than £9.35;"

This is a conditional statement which implies that if the Tender Price were to be lower than £9.35 then the Tender Offer fails since " 2.2 The Tender Offer is conditional upon the following (together, the “Tender Conditions”):"

[this_is_me] 26/2/2024 12:32

Buybacks below the NAV per share will increase the NAV further.

Dividends on the shares bought back will not have to be paid leaving more money for further buybacks.

[fordtin] 26/2/2024 09:42

Tag57 - I guess we agree to disagree.
As mentioned earlier, if everyone agreed on everything there wouldn't be a market.

[tag57] 26/2/2024 09:35

Fordtin, no I am just suggesting that cash included in NAV should surely be on a 1:1 basis therefore any change in the cash balance of the business (via payment of divis etc)should have a 1:1 effect on NAV. If this is the case then the discount applicable to the rest of the company assets is probably higher than just comparing NAV to market cap.
Just my opinion

[fordtin] 26/2/2024 09:33

I bought a few extra shares in the 920's this morning with the sole intent of offering them for tender.

"the Tender Price per Share not being less than £9.35".
A one month hold for a >1% return and further upside potential, with zero downside. Seems like a pretty good deal in the current market.

[bluemango] 26/2/2024 09:29

Note, btw, how every one of those reasons for current low valuation may legitimately be seen a temporary.

Whatever your views on him, Trump back in the White House should also work in shareholders' favour. November not so far away in the scheme of things.

[bluemango] 26/2/2024 09:24

I think the confusion here is that you clearly can't view the current situation with any of the 'normal' assumptions. When so many variables are out of kilter (the most obvious one being the current low valuation brought about by a combination of high interest rates, lower energy prices, ESG political correctness & income fund outflows) then analysis that attempts to follow usual conventions is made much more difficult.

[fordtin] 26/2/2024 09:00

Tag57 - not sure I follow. Are you suggesting cash is the only asset worthy of consideration?

[tag57] 26/2/2024 08:53

Fordtin, as the divi is cash leaving the business I would have thought the market cap should drop by the same amount, everything being equal.
This is assuming that as part of the NAV the cash position of the business is included in NAV on a 1:1 basis with the EV of the business just being more heavily discounted than when comparing NaV to share price The opposite would be true if in a negative cash position.
BWDIK.

[fordtin] 26/2/2024 08:37

nigelpm re; “All being equal it will fall by exactly the dividend amount. That's the point.”

The point is actually not that at all.
As the company is trading at such a massive discount to NAV, If the share price fell by exactly the amount of capital returned to shareholders, returning 30% of the NAV to shareholders would reduce the share price to zero but the company would still retain 70% of it’s NAV!

"All things being equal", share price should fall proportionally to the fall in NAV.
As all things are invariably not equal, some people are willing to sell their shares xd at a price which is roughly equal to the pre xd price less the dividend.
I guess the point should be; irrational behaviour is what makes a market.

[fordtin] 26/2/2024 08:11

A couple of points which are probably worth highlighting;

"(e) the Tender Price per Share not being less than £9.35;

(f) the total number of Shares purchased pursuant to the Tender Price being not more than 3,881,238 Shares"

[fordtin] 26/2/2024 07:42

RNS;




Circular;



"YOU SHOULD READ THE WHOLE OF THIS CIRCULAR, WHICH CONTAINS THE
MATERIAL TERMS OF THE RETURN OF CAPITAL, AND NOT JUST THIS SECTION,
WHEN DECIDING WHAT ACTION TO TAKE. IF YOU WISH TO RECEIVE YOUR
ENTITLEMENT TO THE Q323 DIVIDEND, YOU DO NOT HAVE TO TAKE ANY FURTHER
ACTION AND YOU WILL BE PAID YOUR ENTITLEMENT TO THE Q323 DIVIDEND ON
28 MARCH 2024."

[nigelpm] 26/2/2024 07:24

All being equal it will fall by exactly the dividend amount. That's the point.

[justiceforthemany] 26/2/2024 07:15

Nat Gas +5%

[grahamg8] 25/2/2024 18:19

Thanks for the explanation. I agree the share price will fall by less than the divi everything else being equal.

[bountyhunter] 25/2/2024 17:00

Warren Buffett on buybacks recently:

Buffett, who determines the level of buybacks at Berkshire, has repeatedly said he is price conscious, noting in his annual letter: “All stock repurchases should be price-dependent. What is sensible at a discount to business-value becomes stupid if done at a premium.”

We are certainly trading at a heavy discount here.

[grahamg8] 25/2/2024 14:37

Fordtin, if you take assets out of the Company eg as dividends or to pay for share buy backs the NAV goes down. It is wrong to just keep the NAV constant in these circumstances. But the general principle is correct taking shares off the table at a discount will certainly increase the discount, as long as the share price doesn't begin to rise because there is a shortage of stock on offer.