Real Estate Credit Inves... Share Discussion Threads

[loglorry1] 29/3/2024 12:42

"RECI management are quite conservative when it comes to their watch lists and provisions."

I'm not sure if that is true or if they are just better at hiding it. They obviously lost a lot on the bond portfolio but managed to slowly creep NAV down without really making a song and dance of it.

I'd say they are better than most but they are all pretty much overpaid and useless.

[tag57] 29/3/2024 12:25

MWJ1959 - good commentary. The only general comment I would add is that I read somewhere that RECI management are quite conservative when it comes to their watch lists and provisions.
I don’t know the history on their write downs so need to take a look but if the above is true then it maybe a decent entry / investment point.
My average cost is around £1.35, so not great, but I wouldn’t be put off investing further divis here.

[mcunliffe1] 29/3/2024 11:34

I for one couldn't add to your very reasonable interpretation mwj1959. Thanks for that.

I'm holding in here with my £10k which is now down about £500. I've had about £360 in dividends since my first £5k investment in mid-May 2023 at £1.26 and the second £5k on 20 March 2024 at £1.17735.

Not inclined to add further just yet.

[mwj1959] 29/3/2024 11:17

There are number of possible reasons for the share price weakness in my opinion:

1. A forced seller(s) out there, overwhelming demad from the buyback / other investors. I'm going to try and get hold of a Bloomberg shareholder print out to see whether that can shine any light on where any selling might be coming from.
2. Increased writedown / default concerns against a still challenging RE backdrop. We've had a number of modest writedowns in recent months and in the last presentation (as at end Dec 23) there were £44m worth of loans (13% NAV) that were described as "Performing. Watchlist for potential underperformance". The next update on this will likely not be until early May, when they publish their Q4 presentation. While LTVs at 60% for the overall portfolio are relatively conservative (at least in the context of a RE vehicle)we should not forget this is still a leveraged vehicle.
3. Concerns about the sustainability of the dividend. The 12p annual payout has been very stable, even in "difficult" market environments, but is currently only "predominately covered by net interest income", albeit they are targeting it to be fully covered down the line. Clearly, what happens to 2 will be key here.

Does this warrant the share price to be trading at a 20%+ discount? If you believe one or both of 2 and 3 were to be realised such a large discount is probably warranted and would probably see the share price fall further. But for those who don't around current levels should provide an attractive entry point.

Interested to hear other thoughts here.

[skyship] 29/3/2024 06:33

Bought yesterday - No Stamp Duty

[aamhager] 28/3/2024 20:36

Can anyone clarify whether stamp duty is due on RECI? Does not look like it from my simulation on ii

[hindsight] 28/3/2024 18:35

Only reason I can see is sellers want to get out further on the curve

[skyship] 28/3/2024 16:34

Topped up with 10k at just under 115p. 115p = a 10.43% yield.

Sellers surrendering a yield at that level surely rather bizarre!

[loglorry1] 28/3/2024 15:59

£10m to buy back over next 6 months. I estimate that's about 75K shares a day. Probably around 10% of daily volume so should make a bit of difference one hopes.

[spoole5] 28/3/2024 15:57

New buyback, new price fall!

[feuille] 28/3/2024 13:05

You're welcome MRF

[davebowler] 28/3/2024 11:33

LiberumMkt Cap £261.3m | Share price 116.0p | Prem/(disc) -21% | Div yield 10%EventRECI has announced it intends to undertake a further buyback programme which will run to September 2024 with an aggregate price of all shares acquired being no greater than £10m. The successor buyback follows an initial buyback programme announced on 31 August 2023 where 4,095,000 shares were acquired for an aggregate amount of £5m at an average discount to NAV of 16.1%. The maximum price per share must not exceed the higher of (i) 105% of the average middle market quotations for the five preceding business days and (ii) the higher of the last independent trade and the highest current independent bid on the London Stock Exchang

[my retirement fund] 28/3/2024 09:38

Resorting to tail swallowing with large share purchases seems the only way to halt the astonishing fall. The complete opposite of what in a normal economy a debt investment company should be doing. In a healthy economy, it would be raising more money to invest by issuing equity. Just shows what a sick and decrepit stock market London now has. Congratulations Brexiteers!

[wllmherk] 28/3/2024 08:21

Halifax were the same, just stopped allowing purchases around a month ago, I can now buy again. Wondered if it might be something simple like an out of date KID?

wllm :)

[wilwak] 28/3/2024 08:18

CdM.

iWeb stopped allowing buys in RECI about a month ago but now they’re live again.

It’s worth having another look at your platform. Seems to keep changing.

[rimau1] 28/3/2024 07:24

Yes, great news on the new 10m buyback, great example of having liquidity in the short dated portfolio to flex the mandate and take advantage of the discount.

[creme de menthe] 28/3/2024 07:12

Another larger buyback announced. Clearly the management feel disparity between share price and nav. Would love to buy more but my platform no longer allows!

[mcunliffe1] 27/3/2024 10:30

That is also my policy badtime - hence my pm. But on this one, final occasion I thought I'd go public.

[badtime] 27/3/2024 10:01

...how's it go? Don't feed the troll ...filter and/or don't respond then the issue will go away

[alter ego] 27/3/2024 09:53

I had MRF filtered long ago for foul language wherever he posts. Easier than trying to reason with him.

[mcunliffe1] 27/3/2024 09:41

MRF is an armchair warrior masquerading as a moral coward.

I PM'd him yesterday to politely suggest he debates his brexit views on the SHA thread and avoid the RECI thread posters the hassle he/she/it is causing.
Can't handle a bunch of debaters who don't need to resort to foul-mouthed tirades I guess.

[tonysss13] 27/3/2024 09:30

exactly RC if i want to read that nonsense i'll go to twitter

[rcturner2] 27/3/2024 09:24

MRF has brexit derangement syndrome.