Henderson Diversified In... Share Discussion Threads

[rcturner2] 19/2/2015 14:05

I have binned mine now. I have had a fantastic run with these, but the yield is too low now for the type of fund this is.

[envirovision] 19/2/2015 14:03

Prefer SDV, slightly lower 5% yield but sitting on a 17% discount to NAV

[petewy] 18/2/2015 08:48

I'm in for the 5.40% yield.

Henderson Diversified Income Fund's net asset value per ordinary share increased from 87.92p to 88.82p in the year to the end of October and the share price remained largely unchanged at 91.25p as compared to 91.50p.

The company said demand for its shares was strong and following a successful placing and offer for subscription in February and further tap share issues since that date, net assets have grown 54% over the year from £80.9m to £124.6m.

[davebowler] 04/6/2014 12:13

Liberum;

HDIV's NAV per share at 30 April 2014 was 89.4p reflecting a total return of 4.7% for H1 2014. This follows a strong performance in 2013 with 12% NAV TR.

The portfolio has benefited from credit spread tightening particularly for financial bonds and high yield bonds (where HDIV is relatively overweight). HDIV's relatively high exposure to high yield bonds versus loans is likely to continue in the short term due to the manager's muted rate rise expectations.

Liberum view

We note comments from the manager regarding the possibility of some credit valuations looking stretched given the level of credit spread tightening experienced in the market (ITraxx Crossover 5 year CDS spreads are now at their lowest level since June 2007). The strong total return in 2013 is unlikely to be repeated going forward as income will provide the majority of returns going forward.

We believe HDIV offers an attractive investment proposition with its ability to take advantage of relative value opportunities across the credit spectrum. Floating rate secured loans account for 44% of the portfolio and this should increase over the medium term offering greater protection against eventual interest rate increases. The shares trade on a 5.4% premium to NAV and offer a 5.4% dividend yield.

[losos] 24/1/2014 12:15

topvest - thanks, that's clarified that for me :-)

[topvest] 23/1/2014 21:17

Yes, mine are as well. It's not an open offer it's a placing and offer for subscription. Under an open offer we get an allocation based on the number of shares we hold. Under an offer for subscription we subscribe like everyone else. I'm not sure that I will take up more, but will have a look.

[losos] 23/1/2014 16:54

PHILO124 - "Placing and open offer."
My broker is calling it a 'Subscription Offer' I haven't got a clue what the difference is, assuming there is a difference, does anyone know ???

[philo124] 14/1/2014 07:20

Placing and open offer.

[davebowler] 13/11/2013 10:53

RECI now above NAV but with lower annual management fee.

[davebowler] 04/11/2013 10:10

Still at a premium compared to RECI at NAV ;
1st November 2013

HENDERSON DIVERSIFIED INCOME LIMITED

As at close of business on 31st October 2013, the unaudited net asset value per share, calculated in accordance with the AIC formula (including current financial year revenue items) was 87.3p.

[davebowler] 07/10/2013 10:05

hxxp://www.henderson.com/Sites/Trusts/Diversified-Income/PostDetail.aspx?xpostID=7028

[davebowler] 03/10/2013 09:31

RECI still below NAV;

Liberum;
Real Estate Credit Investments (RECI / BUY) - Bond gains highlight NAV upside potential



n 1.8% NAV uplift: NAV per share grew by 1.8% in the second half of September to 155p (15 September: 152p) due to strong performance in the bond portfolio.



n Bond portfolio +2.6%: The bond portfolio rose 2.6% in the month as a result of material repayments and strong m-t-m gains.



n Loan pipeline: Cheyne, the investment manager, has a £150m pipeline of loan opportunities (of which we would expect approximately 25% to be allocated to RECI) with further investments expected in Q4 2013.

Liberum View:

n RECI's bond portfolio continues to deliver consistent returns with a YTD return of +15.2%. This is partially driven by bond sales / repayments above market value and ahead of management's assumed repayment date. RECI has sold £64m of bonds over the past year at an average uplift of 26% over the acquisition price (weighted average sale price of 0.89 vs. cost of 0.70). The total amount of sales is equivalent to 81% of the portfolio market value at the start of the period. There is an additional £20.6m of embedded value in the bond portfolio which is equivalent to 52p per share.

n The pipeline of loan opportunities is encouraging and highlights the manager's ability to access dealflow in the current lending market. This is in direct contrast to recently-listed peers where the pace of investment has been slower than anticipated resulting in downward revisions to year one dividends.



n RECI trades on a 2.6% discount to NAV and the shares offer a prospective 7.2% dividend yield (assuming the proposed placing completes), This compares to a 3.6% premium and 4.0% dividend yield for peers. We regard the 5 point differential in the share rating as unjustified given RECI's superior track record and the combination of attractive income in addition to NAV upside potential.

[davebowler] 09/7/2013 10:04

Compare to RECI;

[losos] 03/6/2013 10:20

These should go ex-div on Wed. (5th. June) according to company web site but ADVFN are not showing it (No surprise there lol) but my broker also not showing it and their events diary is usually reliable.

[davebowler] 20/3/2013 14:00

https://www.brighttalk.com/webcast/2001/68275
About 3rd minute onwards John Pattullo talks about how secured loans are better risk/reward.

[davebowler] 06/2/2013 09:52

RECI is up by 20% over 3 months versus HDIV's 10% rise and its still at a 14% discount to NAV

[davebowler] 27/11/2012 10:42

I mention RECI as a similar fund to HDIV - admittedly its more geared (by RECP) but I believe both have their merits and HDIV is lower risk. That said I don't think it deserves being at a premium so I pointed out its 4% premium in September.You can see on the graph its fallen back since then to fair value.

[badtime] 25/11/2012 00:33

Given that DB is the only one contributing on HDIV..i think we might let him off sunshine

[tatie] 24/11/2012 11:27

If I want to read about RECI I'll go to their thread. You're obviously long on them. Good luck. But please don't clutter this thread by copying their announcements.

[davebowler] 23/11/2012 15:42

As at close of business on 21st November 2012, the unaudited net asset value per share, calculated in accordance with the AIC formula (including current financial year revenue items) was 83.9.

Meanwhile RECI news;
Real Estate Credit Investments (RECI / BUY / 101.25p) – Interim results to September 2012

n 21.3% NAV total return in H1 – NAV per share rose by 18.2% in the six months to September 2012 with a particularly strong performance in the quarter ended 30 September 2012 driven by bond repayments on the portfolio. In addition dividends of 3.4p (3.1% of starting NAV) were paid in H1. The NAV has been superseded by recent fortnightly factsheet announcements which highlight a further 4.4% NAV increase in the period to 15 November. The NAV total return for 2012 YTD is now +40%.

n Bond portfolio offers upside – Despite strong mark-to market gains in the portfolio valuation in the period, the portfolio is still valued at 66% of par at September 2012. The average effective yield on the portfolio is 13.7%.

n Bond repayments driving NAV performance – Approximately 20% of the value of the bond portfolio was repaid at par in the period. The average purchase price of these bonds was 82% of par. A further loan was sold post-period end which generated a total return of 13%.

Figure 1: Bond repayments post-June 2012

Bond


Date of repayment


Event

TITN 2006-4FS


Jul-12


Full repayment of bond with PIK interest following refinancing

ELOC 26


Jul-12


Full loan repayment (backed by City of London office property)

DECO 2007-E6


Jul-12


Full loan repayment (backed by German shopping centre)

INFIN SOPR


Aug-12


Full loan repayment (backed by German shopping centre)

OMNI Loan


Oct-12 (post-period end)


Full loan repayment (backed by London residential properties)

Source: Company data



n Accretive acquisitions – Part of the cash from disposals has been reinvested with net purchases of £7.1m in the quarter to September. The bonds were purchased at an average price of 78% of par and as at 31 October the price had risen to 81% of par. The acquisitions included a €4.2m commercial loan secured against a portfolio of commercial properties in the Netherlands at an LTV of 64.1% and a life of 3.5 years (yield of 17.6%). More recently, the manager has made a £10m mezzanine loan at a 65% LTV (12% yield) backed by a London office property and has identified another £5m loan that it expects to complete in December on similar terms.

n 17.6% increase in dividend – RECI has declared a 2.0p quarterly dividend which is in line with the company's policy of distributing 6% of NAV.

n Attractive investment pipeline – The manager has identified an attractive pipeline of bond and loan opportunities and it expects to sell down the lower yielding assets in the portfolio to invest further in these assets. 20% to 25% of the gross asset value is expected to be allocated to real estate loans over the next two quarters as RECI seeks to capitalise on the retrenchment of traditional real estate lenders from the market. which should leave the company close to fully invested.

n €1.3m return for ERII shareholders – ERII's NAV rose by 7% in the period driven by cashflow generation. ERII held cash of €5.6m at September 2012 of which €3m is segregated in relation to the Newgate 2006-1 residual cashflows and €1.0m is being held back for litigation costs. A dividend of 3.2 cents per share has been declared which equates to a distribution of €1.3m or 12.5% of the current share price.



Liberum View:

n RECI has delivered a strong set of results for the period to September 2012. The significant level of bond repayments at par in the period demonstrates the robust nature of the company's credit underwriting process.

n We believe the current 25.4% discount to NAV is too wide given the strength of the underlying portfolio and the implied prospective dividend yield is 8.0% (based on the company's policy of paying out 6% of NAV). We think this will ultimately see the shares appeal to a wider set of investors and we expect the discount to narrow as an overhang on the shares has been removed.

n We note the manager's comments regarding the acquisition pipeline which should enable the company to deliver additional NAV growth given the manager's track record of identifying and capitalising on attractive opportunities.

[davebowler] 17/9/2012 11:30

4% Premium to NAV;


As at close of business on 13th September 2012, the unaudited net asset value per share, calculated in accordance with the AIC formula (including current financial year revenue items) was 81.8p.

End July make up;
Secured Loans 51.1%
High Yield Corporate Bonds 29.2%
Investment Grade Bonds 18.0%
Equities 1.6%

[davebowler] 29/8/2012 15:13

As at close of business on 24th August 2012, the unaudited net asset value per share, calculated in accordance with the AIC formula (including current financial year revenue items) was 81.78p.

[davebowler] 07/8/2012 09:37

RECI NAV up again;

www.recreditinvest.com/investmentmanagerreports