Woodford Patient Capital Share Discussion Threads

[spectoacc] 26/10/2019 16:26

@chucko1 - more about the kudos than the wealth I'm sure. Wanted to be the big swinging d*ck and started to believe his own PR. Could hardly be more different than when he started out!

"The market is full of rags to riches to rags stories".

I don't feel sorry for Neil but I do feel for his investors, the ones who trusted the likes of HL, STJ, the press, and their financial advisors, rather than those who should have known better!

[chucko1] 26/10/2019 15:03

@Specto, he just wanted a bigger yacht. Many succumb. Bernie Ebbers being one of the more famous.

Goes to show that the happiness vs. wealth curve is a complex one. Better just to chill, but Neil simply could not. That alone doesn’t make him a baddie, though.

[spectoacc] 26/10/2019 13:31

@rambutan2 - indeed. Avoided anything impolite about Woody's Atom Bank investment - perhaps the best that can be said is it's a hot sector, and WPCT at least won't be a forced seller. And perhaps sufficient other investors to supply it with cash to keep it going.

@Psychochomper - filter fakes like "Johnwig"! Pity it can't be done at IP level, keeps reappearing under different names. Adds precisely zero to the debate.

@daffy - guessing the explanation is Woody's tens of millions are trapped in WEIF, but do like the notion that he could go t*ts up despite having made such vast sums. Some poetic justice for the financial problems he's causing his investors (remember what we all said about the likelihood of a December ungating - how many were desperate for their cash back?).

Some enjoyable (albeit not 100% accurate) comments in MoneyWeek from MSW:

"Tell the story from scratch to someone not following it and it will sound unbelievable. Tens of thousands of people gave billions of pounds to a man to invest using a style he could produce no track record for in an environment he had no experience of.
That man made every mistake it is possible to make as a money manager. He changed style - leaving value for overpriced healthcare and tech firms. He ignored criticism and compliance. He believed his own hype. He raised too much money. He held too many illiquid assets. He blamded the market every time something went wrong."


[Edit - going back through WIM's last set of accounts reminded me just what a money machine it was. Not only the £36m divi to Craig & Neil, but £12m of wages, the lion's share no doubt to NW. If they could squeeze £50m/yr out, why take risks? Buy the big liquid FTSE100's, lag or beat the market with excuses for the lag years. Even without growing beyond say £10bn under management, in 20 years there's £1bn of pure profit. Double the AUM and get there in nearer 10, or £1bn each in 20 - and that's profit, not including the value of the actual business. Staggering to think Woody wanted more, wanted to shoot the lights out, created an "income" fund that had RUTH, IH, Benevolent, Autolus, Immunocore, & other complete non-divi techs. And is now rightly finished.]

[daffyjones] 26/10/2019 03:38

Daily Fail claiming Woody has had to sell some of his prized horses to raise cash:

Neil Woodford has sold two of his prize horses as he seeks to offload some of his 'luxury items'.

Experts said the sales could recoup as much as £70,000 and save Woodford, 59, around £40,000 a year in running costs.

A source close to the couple confirmed that 'top-class event horse' Carden Earl Grey and 'novice' Ringwood Gold Dust have been sold.

[psychochomper] 26/10/2019 00:07

”I'm no longer particularly cheerleading for this stock (I'm not daft)”. 'No longer' suggests that you admit you once did. Strange, as only a complete fool would have had anything positive to say about it. If I were you, the best thing for you to do would be to reflect on what you got so badly wrong.

You write this the day after crowing about its rise from 30p to 40p, as though people like myself should be embarrassed or somehow fearful. Far from it - I attempted to reestablish the full short once again, but it was not available. Alas. 36p now.

And you give the impression of someone tormented by the bitterness of a terrible loss on your investment in this stock, lashing out at anyone who has intellectually bested you here. You were warned so clearly, but seem unable to separate intellectual standards, as you call them, from uncomfortable truths.

[johnwig] 25/10/2019 22:49

I'm no longer particularly cheerleading for this stock (I'm not daft) nor adoringly supporting the wretched Woodford (I never did). However the two posts supposedly from specto and topvest are proof of the low intellectual standards on this thread. How can they airily dismiss, with no knowledge and no rationale, dozens of stocks of which they are clearly ignorant?

It's pure trollery and for the thousandth time from "both"!

[rambutan2] 25/10/2019 19:04

Yes, bit of a puzzler Schroders wanting to take this on. Will ponder on it over the weekend.

Re Atom Bank. Is not an obvious hidden value/write up candidate:

[topvest] 25/10/2019 18:53

What a hopeless list of sucker stock investments. Personally, I will be surprised to see them clear the overdraft, but haho there may be a bigger fool somewhere? Trouble is even the bigger fool theory doesn’t quite work as the seller is distressed and they know that. Even stupid bubble investors don’t buy popped bubbles if you see what I mean! Just look at the nonsense of Wework.

[jonwig] 25/10/2019 18:41

Porsche - "Schroders are out for the buck, get real."

That's fine, rest is poor form.

[minerve 2] 25/10/2019 15:25

Schroders are not going to put a blot on their reputation just for some good income streams from WPCT. Without doubt they have discussed and scrutinised the portfolio and NAV would have been discussed with the trustees as part of the management selection process. I doubt any trustee would select a manager who is going to just make life easy by kitchen sinking at the expense of their own reputation. For that reason I think those who expect any great kitchen-sinking are going to be disappointed. I actually think that the NAV set for performance fees is a reasonable yardstick that Schroders will want to hit within 18 months/ 2 year period. I also think that the debt situation would have been sounded out and that the Schroder's board would have some conformation that, absent of any major unforeseen circumstances, that debt will not be an issue for rollover.

If the NAV is reasonable, which I think there is more than a good chance that it now is, then there shouldn't be too much problem selling the portion held by WEIF. It now comes with a conservative, prudent manager with quality history.

Looking to perhaps open a new position here soon.

[spectoacc] 25/10/2019 14:54

@jonwig - if Schroders had resolved the OD, they'd have had to RNS it I reckon. So no, that's ahead.

Do they know how little IH and the other unicorns are worth? Most probably. Do they care? Why should they? Forget the red herring of the performance fee, they're in it for c.£5m/year of almost pure profit (they get trading costs etc on top). What's not to like?

OK reputational damage, yes - but all to be blamed on Woody, and still the possibility of a major kitchen-sinking ahead of the name change to let them start from a lower base.

What we know for sure - there's big hits to NAV to come on the WEIF forced sales. Further, there's some holdings to go bust due to lack of further Woodford money.

There's big falls ahead in the c.63p NAV, just as there was in the c.90p NAV.

Do Schroders see some winners that they want in, want to back via other funds, want to own themselves? Maybe, but that's largely irrelevant to managing WPCT, they don't own the holdings. Buy them cheap off WEIF.

Might WPCT be a long when WEIF have sold their 9% overhang, sold off the stocks in common, and the OD is confirmed as renewed? Yes, quite possibly - but a lot lower than here. Realistically, you also want Schroders to be making new investments within (former) WPCT, rather than being lumbered with Neil's picks - but how can that happen? Any issuance, warrants or otherwise, is needed to repay debt.

Not seen a full list of WPCT's holdings for yonks, but doubt it's changed much beyond the sales we know about (no more OSI, sold half Autolus). And I don't remember any potentially great investments. And there haven't been any so far.

And now c.£5m/year to be taken out too.

[jonwig] 25/10/2019 14:47

Spec - wouldn't Schroders have been given access to the books (eg. details on IH) once they were in the bidding circle? My point is that S will expect to make a profit and will know a hell of a lot that we don't. They'll also have sorted out the overdraft extension.

It's obvious that we PIs here have called it right for years, but it's a different game now. Schroders might be able to do things, through City contacts which Woody couldn't. We can be certain that they will be working in their own interests.

As for the market, WEIF is a seller, and a lot will be selling into the rally, so I wouldn't be surprised if the price fell back to 30.

An innovative way to raise cash is via warrants: "Buy one warrant for 20p to exercise for one share at 50p over the next five years."

[spectoacc] 25/10/2019 13:29

Suspect the meltdown in WPCT's NAV will be sooner than that - WEIF will be well advanced with "realising value" (ahem) from the unicorns, held in common with WPCT.

The Oxford Nano float appears to be off (one of the few potentially good ones), Benevolent raised cash at half the previous valuation but - what value for the WEIF stake in it? For Rutherford? For IH?

There's loads to come, and now c.£5m/year going out to Schroders too.

The appointment of Schroders is undoubtedly good for WPCT in the short term as it has removed (hopefully) the withdrawal of the OD in January. But the terms of the new OD will be very interesting, set against a significantly lower NAV and far less liquid holdings (the good stuff, eg OSI, having been sold already).

[porsche1945] 25/10/2019 12:13

Put off your retirement? How much did you have in woodfords Sxxt?!!! Schroders will milk this for all its worth, a pigs trough for fees, they are one of the most expensive greedy managers out there, i should know I own both classes of their shares! Reality will dawn pretty quick and all the expensive failures can be hung on woodford while the fees are extracted, a pig is still a pig regardless of who is putting the lipstick on it. The real meltdown starts January as weif is unwound.

[timnet] 25/10/2019 11:06

Seems to be a lot of sour grapes out there. The involvement of Schroders is quite simply much better than expected news for all patient (long term) holders. At last the hope of achieving some sort of sensible value in 10 years..........just have to put off my retirement for a few more years. Who wants to retire anyway? Probably not Woodford but I guess he hasn't any other option - maybe move to Guernsey?

[schofip] 25/10/2019 10:17

Looks like the captain of the Titanic has been changed but the iceberg is still around.