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Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
---|---|---|---|---|---|
Vpc Specialty Lending Investments Plc | LSE:VSL | London | Ordinary Share | GB00BVG6X439 | ORD GBP0.01 |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
1.40 | 2.66% | 54.00 | 52.80 | 53.80 | 54.00 | 54.00 | 54.00 | 53,987 | 13:13:05 |
Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
---|---|---|---|---|---|
Trust,ex Ed,religious,charty | -1.29M | -22.12M | -0.0795 | -6.79 | 150.27M |
Date | Subject | Author | Discuss |
---|---|---|---|
05/5/2022 13:00 | Happy to say I'm in the 16% boat, although that's not how I think of it. What was a 5% PF weighting is now closer to 9% and happily tucked into ISA's. (Despite Barclays best efforts!) | waterloo01 | |
05/5/2022 11:13 | Mr. Market is buyers and sellers also mmakers taking avoiding action that's why the market is full of opportunity, as always it's about timing then time in. | ctrader3 | |
05/5/2022 11:08 | Mr. Market panics too. | chucko1 | |
05/5/2022 10:53 | anyone foolish/clever/lucky enough to buy at 50p after the fall is receiving a yield of 16%. Mr. Market is always right even though sometimes he's isn't that clever. | ctrader3 | |
05/5/2022 09:21 | Valid points. | spectoacc | |
05/5/2022 08:59 | "Poor months" only offsetting the extreme increase in the valuation of BKKT. Stripping that out (and the share price has basically done that), then the underlying business seems to be returning a tad over 1% a month. Easily enough to cover the dividend and allow for a useful increase in NAV. Anything additional on BKKT and the other 3 (smaller) SPACs is little more than a smallish special dividend. Considering the 16p in dividends over the past 2 years and roughly 5p increase in NAV on top, everything else is basically noise. I expect much of the same for the NAV over the next 2 years as well. | chucko1 | |
05/5/2022 06:18 | A few poor months, then pow: Performance The Company also announces the cumulative NAV total return performance as at 31 March 2022 as follows: Monthly Return 2.54% | spectoacc | |
04/5/2022 16:38 | Back over 90p ahead of next dividend decoration, due in 2 to 3 weeks time. | 2wild | |
01/5/2022 17:11 | These are usually done by way of a tender offer on a pro-rata basis. Eg if you have 1000 shares on the cut-off date, you will be invited to tender upto 250 shares. I would expect discount to reduce by around an average 1% a month until resolution day. I've been increasing my holding during last 4 weeks to 20% of my portfolio. Expect I'll sell around 10 to 25% of my holding as discount to nav evaporates and will take up tender offer in full, assuming there is one. | 2wild | |
29/4/2022 13:55 | Indeed. You cannot create additional value out of nothing (this buying of shares by VSL from shareholders is a closed system). But my earlier maths is not a closed system in that I am looking at what a shareholder can earn over a period of time (a year or so) where the fuel is supplied by the interest paid by the ultimate loan obligors. I looked at the effective return on an additional purchase where the takeout price was a near-known. The point of looking at this this way is that after the buyback, I assume you are left with a holding that is desirable from a long term risk point of view. Others may wish to view it from a different angle. | chucko1 | |
29/4/2022 12:56 | I'm not aware of any specifics about the buyback. It was more of a heads up proposition more than anything. If the buy back is funded by asset disposals there shouldn't be any effect on the 8p divi going forward as the £s paid has been cut by 25%. Using the simple 104p NAV and share price of 88p then assuming a current holding of 30,000 which the holder wants to retain so purchases 10,000 which is now 25% of the new holding then when the buy back occurs there is a gain of 16pps on the 10,000 but a book loss of 5.3pps on the 30,000 retained ie a neutral effect on the holders wealth which seems bizarre. I am ignoring dividends as presumably the funds used to buy the 10,000 shares would be used on something else also yielding something - probably lower than 9% but not necessarily a lot. If my maths and simple understanding is correct , and all things being equal increasing a current holding by a third doesn't do much for an investors wealth. Just keeping the 30,000 results in a neutral value position after the buy back but there would be the chance to buy the 7,500 holding reduction at 82.7p leaving some spare cash left over. The overall end position is the same as increasing the holding by a third. You have a holding of 30,000 and the same increase in cash held but you haven't tied up funds buying any extra shares. | scrwal | |
29/4/2022 08:24 | Didn't see that detail. Will check | smidge21 | |
29/4/2022 07:54 | They are buying the shares back at no worse than NAV from the shareholders, so an assumption of NAV itself is the most conservative one, I suppose. Or up to 25% of them, at any rate. Did they say in detail how they were doing this operationally? I cannot recall they did. | chucko1 | |
29/4/2022 07:44 | Hmm, thx. will think about that. Dividends are covered by returns from their direct lending activity - so as they hoard cash they arent lending thus weakening their total return. Much depends on how holding cash is accumulated before surrendering shares. I'm confused about the suggestion of buying shares at NAV; shares are bought at the market price and, say the company, at not less than a 5% discount to NAV | smidge21 | |
29/4/2022 07:26 | This is not correct, I think. They have insufficient cash as it stands - thank God, or they could not afford the dividends. It is a question, firstly, of where the cash would come from. They could borrow it via a bond issue. Were that the case, they add leverage and pay a bond coupon instead of dividends. This is a saving, of course, although at the expense of higher risk (to the remaining shareholders) but higher per share dividends, or, they could sell assets to finance the share purchase. Far more likely as all they have to do is to allow short dated investments (there are many) to roll off. There would still be a liquidity issue in this respect, but could be satisfied via a short term credit facility. Again, this would represent a significant saving to remaining shareholders. More importantly, in respect of the fact they they are paying "above market" (104p versus 88p), this is irrelevant as they cancel the shares. They do not exist any more. The equity so far issued is a liability and the purchase of it cancels the liability. And this is the reason why there is no accounting loss - as the share price falls (previously), they do not ever take a gain. And this was the big debate back in 2008/9 for banks - they were allowed (via a sudden change) to mark to market their own issued debt (which was the vast majority of their issued capital) as credit spreads rose from perhaps 70bps to 700bps (for Tier 1 or even 2 debt) and similar multiples for their senior debt. This had the effect of offsetting their vast mark to market credit losses. In my previous day job, I had a mark to market loss of some EUR35bn!! Cash wise, very profitable, I hasten to add for fear of losing any credibility I am trying to project! But this accounting change was only for debt and not equity. It was not necessary as there were no significant equity assets they typically held. In our case (VSL), imagine if they were to buy back 100% of the equity. Then, by extension of the "loss" argument, there would be an infinite loss per share (not that any would exist any more). This cannot be the case as all you would be left with was a bunch of assets financed by a bunch of debt, or a dissolution of the company via selling of all assets. In which case every share at 88p would have been retired at 104p (assuming the assets were realised at that price [the NAV], in fact). Of course, this is not the point of the company and would annoy SpectoAcc beyond the point of mere irritation. | chucko1 | |
29/4/2022 06:32 | and the more cash they accumulate presumably the weaker is their ability to support the current dividend | smidge21 | |
29/4/2022 05:48 | Also affects their "..Looking to address the discount.." comment. Not, presumably, through spending too much cash on buying back shares, when they might need rather a lot in less than 12 months. I'd be inclined to vote against the return. VSL's too good a co to be allowed to wither. £244m current mkt cap & costs already approaching disproportionate. (But generally agree with comments on here, subject to the caveat that Putin isn't backing down, and the world's getting riskier btwn now and 2023). | spectoacc | |
28/4/2022 22:42 | chucko1 You will need to factor in the distortion effect of the discount to NAV. At the time of the buyback the company needs be holding enough cash to buy 25% of the shares. If at this time if the discount has remained the same then 104p per share is paid out but market value is 88p meaning the open market value of the company is hit by a larger value in % terms than the total NAV which is 25% - the share price could drop to 83p as a consequence. eg 100M shares has a NAV of £104M but market value of £88M. The cash paid out will be £26M so NAV will be £78M 104p a share but market value is £62M 82.7p a share. This is a simplistic take and assumes everyone opts for the buyback but does highlight a potential pitfall or possibly a buying opportunity if you reinvest the buyback proceeds into VSL. | scrwal | |
28/4/2022 21:41 | A good read, with many pages of notes to cover off most queries. VSL really is a high class vehicle, but clearly not straightforward enough for Mr Mkt, hence its much too big discount. I remain a very happy holder. | rambutan2 | |
28/4/2022 20:07 | For completeness: | rambutan2 | |
28/4/2022 14:35 | chucko1, your first paragraph expresses my thinking precisely and concisely! In buying more VSL now than I would normally hold has some risk (e.g. NAV and consequently the share price plummeting for some reason) but it's a risk I'm content with in view of the upside. | redhill9 | |
28/4/2022 10:43 | If you hold the additional 33% of shares (so a 25% buyback takes you back go where you were originally) for a year (until buyback completed), you can expect a 26% total return on that portion. Around 9% from the dividend (4 x 2p) plus appreciation from 88p to, say, 104p NAV. This NAV assumes an almost zero valuation on BKKT. If share price rises to 99p, so on the border of the 5% trigger level, then you enjoy a 20% return on everything. Other permutations in between! 20% on something which has already shown its quality in testing circumstances is compelling. But VSL has been compelling ever since they started writing back their conservative loan impairments starting March 2020 (and at an share price of 63p or so, and even as low as 44p). | chucko1 | |
28/4/2022 09:53 | They mention the prospect of buying back 25% of shares next year as being "likely". I've been increasing my holding accordingly to allow for this on the basis the extra shares will be bought back at NAV and in the meantime will pay the 2p quarterly dividend. As I've said before, the prospect of reducing the average discount to 5% by early next year looks to me unlikely, but if they do it's a win:win. As noted in last year's Annual Report, in 2020 as part of the Continuation vote, the Company will offer an exit opportunity where the Company will buy back up to 25% of the shares in the Company should they trade at an average discount greater than 5% over the first quarter of 2023. As things currently stand, that exit opportunity is likely to be offered and all shareholders will be notified in due course should this continue to be the case. In the meantime, taking action to reduce the discount to NAV is a priority for the Company, and various steps are being taken towards achieving that goal. (conts) | redhill9 | |
26/4/2022 20:10 | Last year, finals were issued on the 29th. | rambutan2 |
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