Jup Ord. Share Discussion Threads

[hindsight] 30/10/2020 09:52

Sharpshare, tend to agree , on like for like discount no debt is better at present. One can always gear a low debt reit with extra cfds or other borrowing themselves

[skyship] 30/10/2020 09:30

Well of course that is a fact. Gearing = Risk.

Though of course it can be highly beneficial when the Debt costs just 3%, yet can be invested in long lets to secure tenants at 8% rental yields!

[sharpshare] 30/10/2020 09:08

All fair points.
Basically what I was trying to say is that a REIT with a 50% discount and zero debt has a higher margin of safety than a REIT with a 50% discount and 35% loan to value (especially in a falling market).

[skyship] 29/10/2020 14:33

Actually EV = MCap + Debt MINUS Cash & Cash equivalents.

Really don't see just how that package discount definition is going to help much with REIT valuations.

Would you be prepared to offer us an example?

Also never came across it in the delightful days of 2002/5 when many of us were making hay from the Split Caps.

[sharpshare] 29/10/2020 10:16

package discount = (total assets - enterprise value)/total assets
enterprise value = market capitalisation + debt

was a more handy measure for split cap investment trusts
where market cap was sum of capital shares, income shares and ZDPs.

[skyship] 28/10/2020 14:30

Closed out my SUK2 short @ 904 when the FTSE at c5558...

[skyship] 28/10/2020 12:48

Well, I've just bought some outrageously cheap RGL @ 59.6p......they had rallied to 66p just a few days ago!

At 59.6p the discount is 41.9% and the yield 10.07%...

[cc2014] 28/10/2020 09:59

Bouced off 5580 which was pretty close.

It would be foolish to guess where next but I'm trying to keep my powder dry unless I see anything that is outrageously cheap.

It would be helful for Brexit to be resolved.

[skyship] 28/10/2020 08:46

Strewth 5596 already - nearly there!

[alphorn] 27/10/2020 17:43

Could be, sky.

[skyship] 27/10/2020 16:52

The Covid drift back to the 50% FIB retracement level today. Could we see a further quick sell-off to the 61.8% level at c5567:


free stock charts from uk.advfn.com


free stock charts from uk.advfn.com

[skyship] 27/10/2020 16:12

Interesting day in the REIT see AIRE, RGL & SREI.

Havre bought some cheap offers in the last two.

SREI @ 30.75p whilst the buybacks are under closed period lockdown At that price the discount is back up to 46.6%. Sp was up to 34p just a few days ago; and likely to move back up there pretty quickly again when buybacks resume.

[skyship] 26/10/2020 16:05

SS - I too have no knowledge of "package discount". Please do enlighten us...

[sleepy] 22/10/2020 14:49

Sharpshare - what is a package discount please?

[apollocreed1] 22/10/2020 14:25

Re SERE - I'd like to wait a week or so to see what happens to GBP/EUR. If they make a deal, the rising pound will make SERE's NAV take a big hit.

[sharpshare] 22/10/2020 11:19

Another good update at SERE today.
Sep 2020 NAV increases about 13% on June NAV to around 136.7p
Shares still look good value at 77p.
See SERE thread for more details.

SERE LTV to be close to zero after recent sale concludes.
It is important to also compare package discounts of other property companies not just the NAV discounts.

[starpukka] 16/10/2020 15:40

Thank you, Skyship.

[skyship] 16/10/2020 09:18

.... and I look forward to the NAV & Trading Update before the end of the month.



free stock charts from uk.advfn.com

[skyship] 16/10/2020 09:01

sp - no, not at all. At what looks to be the offer price of 50.7p the discount = 43.8% and the yield on a very well covered 4p annual dividend = 7.89%.

This lowly valuation in spite of much evidence that Retail Warehouse footfall is highly encouraging; and that regional offices could be beneficiaries of moves away from the cities.

Definitely oversold and excellent value.

[starpukka] 15/10/2020 23:22

Hi Skyship,

I am holding EPIC.

As Covid restrictions are kicking in again, are you more concerned for this stock ?

[skyship] 15/10/2020 09:27

A series of lower highs normally viewed as a bearish indicator:


free stock charts from uk.advfn.com

[skyship] 06/10/2020 09:57

Yes, a bizarre drop. Missed it, saw it, assumed they were sales, now cheapest offer 48.75p! Well done you - good trade.

[gary1966] 06/10/2020 09:49

Did my bit to support EPIC this morning and added a reasonable amount at 46.69 incl SD. Not sure why the price suddenly dropped 3p but was in the right place at the right time and a happy recipient. Assume they will be XD next Thursday.

[hindsight] 06/10/2020 08:53

Can hedge fx cheaply these days, in fact get paid to short euro, so wouldnt let that hold SERE back but whether its a good investment is another issue

[skyship] 06/10/2020 07:54

Sharpshare

Below is an extract from my spreadsheet on 16 secondary propcos.

# Extracted to show those on 40%+ discounts

# AIRE & RGL included because of the great yields

# All NAV stats are to Jun'20, exc. MCKS still to Mar'20

EPIC share price ...NAV...Disc...Divi..Yield
---------------------------------------------
AIRE 51.00 83.60. 39.00 5.00 9.80
BCPT 67.20 120.70 44.30 3.00 4.46
BREI 52.00 96.60. 46.20 2.50 4.81
EPIC 49.50 90.24. 45.10 4.00 8.08
MCKS 190.00 329.00 42.20 7.20 3.79
RGL 66.00 102.60. 35.70 6.00 9.09
SLI 46.80 79.60.. 41.20 2.86 6.10
SREI 32.85 57.70. 43.10 1.54 4.70

"You pays your money you takes your choice"....but sure looks to be
some great value out there, especially those showing good rent collections.

So those high discounts are now commonplace, without the need & the benefit of a sale contract to be completed in 18months time.

Also a very possible risk is a £ bounce after a Trade Deal with the EU. If that happens the GBP/EUR rate will be back up to 1.20 v. the current 1.10.

So SERE not one for me; though others will differ...