Picton Property Income Ld Share Discussion Threads

[davep4] 08/1/2014 00:42

physical market -v- collective vehicle

I guess it depends if the investor has the time, capital and skill to invest in a portfolio of properties Kavinish!

If needs be, you can always sell equities which is not always the case with physical assets.

[kavnish] 30/12/2013 17:59

Hi redsonning

My rationale is simple all investors have the option of private or public markets, issues is timing and also as you point out there are costs to doing this.

The argument over assets and enterprise value difference is a simple one, I put little value to the " managers skill" , they are rewarded on the way down as well as on the way up.

The mkt holds better value elsewhere , good solid growth cos selling for 10 times earnings.

The time for listed prop cos will come back until then the private mkt is a better bet , I have been doing this for 20 years the cycles never change , but the " it's different this time , gets louder

[redsonning] 26/12/2013 18:08

The story is not as simple as you make it sound Kavnish. Essentially you are simply saying set up the kind of debt PCTN has set up and buy the right kind of commercial properties privately, then manage it and keep all the money yourself. If anyone thinks this is really simple then go ahead and try it - but I don't think you will find many that want that kind of risk and commitment! If commercial property assets are going to attain significantly higher values in say 2-3 years time than they are now, then it is still rational to hold well managed propcos.
And by the way most kinds of businesses sell at a premium to their underlying assets because the management of those businesses itself has (intangible) value. Using your investment logic almost the whole market is a sell almost all of the time! Whilst there are many listed companies whose businesses are not well backed by tangible assets, commercial property is an example of a sector which is at least very largely so backed.

[bscuit] 24/12/2013 21:46

I'm now primarily a "buy and hold" investor and have had a number of Property shares in a wide definition and have done well. My number one gainer in the last year has been GPOR [+109%] but also DLN, PCTN, NRR, QED, GFRD] I reckon one just needs to watch the market for an exit. Happy to let PCTN run--
up 50% since February.

[kavnish] 23/12/2013 19:22

Guys a simple story, when the public market prices assets above the private market. You sell the public and buy the private.

A bit like the mgmt team are doing by issuing equity.

It's just not that complex

[carterit] 23/12/2013 14:16

My thoughts exactly redsonning

[redsonning] 18/12/2013 14:28

Apologies - I missed this discussion about the relative merits of holding or getting out of the property investment companies, but I will add my comments anyway.
Those who have followed my views in the past will not be surprised to hear that I agree with the sentiments expressed by Lord Gnome. As it happens I also like buying assets at a discount to underlying value, but this does not mean that is the only parameter to note. The last few years have seen generally falling NAVs as the propcos have struggled to get their overall finance situation in balance. Despite this, the levels of discount available meant judiciously choosing where to invest has paid significant returns to the brave.
However, the position is only recently turning to a more encouraging environment where there is expectation of rising NAVs into the future, and in a sector which still pays attractive dividends. Indeed it is those rising expectations which have pulled in other buyers and pushed prices above NAV - it has simply taken the wider market much longer to see the merits of this sector. The upward momentum in NAV could well be much more significant over time than the NAV discounters give credit for, and my view is therefore that this remains a sector to hold for a lot longer yet.
The issuing of modest amounts of new equity at a premium to NAV is logical in providing further balance sheet flexibility and lowering gearing. The only reason one should be against that, would be if one expected a near term decline in commercial property values. My view is that this will not happen - the market is now going in the other direction, and the share prices and the quarterly published NAVs are continuing to tell me that.
There is money to be made.

[nickg2] 29/11/2013 09:35

Picton Property Income Limited Director/PDMR ShareholdingTIDMPCTNRNS Number : 2748UPicton Property Income Limited29 November 201329 November 2013PICTON PROPERTY INCOME LIMITED("Picton" or the "Company")Director/PDMR ShareholdingPursuant to Listing Rule DTR3.1, Picton Property Income Limited announces that the following beneficial holding of ordinary shares was acquired by Mr Roger Lewis, Director of the Company, on 28 November 2013.50,000 ordinary shares at 54.42p representing 0.014% of the Company's issued share capital. The shares are registered under Hulton Pensions.100,000 ordinary shares at 54.37p representing 0.028% of the Company's issued share capital. The shares are registered in the name of Mr R St J H Lewis.Mr Lewis is the beneficial holder of a total of 400,000 ordinary shares representing 0.112% of the Company's issued share capital.-ENDS-For further information:Northern Trust International Fund Administration Services (Guernsey) LimitedDavid Sauvarin 01481 745529, [e-mail] to EditorsPicton Property Income Limited ('Picton') is an income focused, internally managed Investment Company listed on the London and Channel Islands Stock Exchanges. It was established in 2005 to invest both directly and indirectly in commercial property across the United Kingdom.With Net Assets of GBP180.2 million at 30 September 2012 and approximately 860 investors, the Company's objective is to provide shareholders with an attractive level of income, together with the potential for capital growth by investing in the principal commercial property sectors. www.pictonproperty.co.ukThis information is provided by RNSThe company news service from the London Stock ExchangeENDRDSKKLBLXFFLFBX

[rcturner2] 28/11/2013 09:45

Skyship, thanks for your comments on the thread, very useful for someone like me who does not know the sector.

Could I ask what else you hold in property and why you prefer these other stocks?

[skyship] 28/11/2013 09:23

red army - we appreciate that fact. However many of us were holders a year ago, so by looking at the Header you will appreciate the long and profitable journey.

For the more active investor there comes a time when you cash in and move on - especially as the shares now trade at a premium to NAV and the Board has quite sensibly decided to increase their firepower and start issuing equity.

The point is we've all benefited from riding the propco boom; but I just have a personal antipathy against holding shares at an NAV premium when they spend 90%+ of their time trading at an NAV discount! They are more likely to revert to the median IMO.

That said I'm more than happy to see these make further progress as it would mean a similar or better performance elsewhere in the sector - perhaps where I hold!

[red army] 27/11/2013 20:54

I don't think you guys appreciate that the trend is up and so are the NAV's

[kavnish] 27/11/2013 20:29

Sky ship completely agree with you, when the retail market is willing to pay more than the assets are worth you know which way to go.

The nonsense about valuations is irrelevant , cash in go along to your nearby auction and pick up the real thing with no mgmt fees.

But still who are we to reason why .

[skyship] 27/11/2013 11:46

Well there we have it - not a very wide sample, but as ever it is different views that make a Market. 2 have sold; 2 hold...

[alanji] 27/11/2013 09:36

I am still way overweight in property and agree that prospects for the sector still look encouraging. However there is a fair bit already built in to some of the share prices - quite a few, including PCTN standing at a premium, a sure warning sign that now is the time to consider selling.
I sold PCTN at prices from 48p to 54p at profits of up to 48%, incl divs - there is better value elsewhere. My holdings now, in descending order, are MCKS, ERET, FCRE, LSR, TEIF, CIC and IERE

[colonel a] 27/11/2013 09:21

Can't say I agree on this one Skyship as you are effectively saying that you don't ever want propcos to issue new equity.
PCTN has been a great ride but staying in is a different decision to getting in.
I will stay and am happy to see the company getting a bit bigger.

[skyship] 27/11/2013 08:07

When propcos start issuing equity at a premium to NAV, it is a surefire indicator of time to head for the exit.

It's been a fantastic ride and well done to all holders who have resisted the temptation to move on; but surely on this news the share price will trade back to the 50p level or lower over coming months.

[asmodeus] 13/11/2013 08:15

AUMP - revised assets per share 219p. Share price 57p. (See this morning's report). This seems too good to be true regarding risk if they have to wind up? Is it?

[cerrito] 12/11/2013 19:05

Got a warm feeling from reading today's statement-as of course I would expect as the shares trade at a premium.
The increase in provisions for staff bonuses which are based on the share price reminds us that there is no free lunch.
Neither buying or selling-not sure if I see the share price going much higher but would be surprised to see it below 50p

[asmodeus] 05/11/2013 16:24

Also, see Sky's post 271

[skyship] 05/11/2013 15:56

K - re LSR - the link below shows my original post on the "Liquidations" thread back in August. Admittedly they are now up 23% on that oversold price; however I still believe the Fundamentals and the liquidation strategy merit a BUY @ 31.75p.



Incidentally, well done you if read correctly. 80% of your SIPP in commercial property would ensure a pretty impressive YTD performance...

[kavnish] 05/11/2013 15:00

Hi Skyship

apologies for the delay, I didn't buy in as you had stated , have moved to a long on AGK and WEIR through the SIPP on the property side already heavily invested directly something crazy like 80% plus of portfolio so as said in earlier posts a long term bull.

Will keep an eye on LSR looks interesting anything you can point me to research wise on that one

Thnks

[nickg2] 04/11/2013 20:44

Half Year Results out on the 12th November...

[skyship] 31/10/2013 18:31

Kavnish - I do agree with you - when you lose the cushion of the NAV discount the holding of a propco at a premium is a hostage to fortune - no longer a value play.

I sold lower down; but am certainly happy holding 35% of my SIPP in propcos at good discounts - APT, DSC & LSR - all rising just as well, if not faster. Sold my CIC as they have perhaps now got ahead of events.

IMO Best Buy at the moment - LSR - share price 32p v. 46p NAV, 56p EPRA NAV. Company in voluntary liquidation. Plenty of info on the LSR thread.

Did you buy DSC after my 257 above - hope so - now up 27% since then...