Marlin Warrants MLNWE

[tim23]

Due to start trading Monday, any guesses at price given all the stocks in Fisher stable are trading at premium to NTA my guess is 25c

[Beagle]

I suspect that you'll be quite close with that guess Tim. Last traded share price was $1.51 and the warrant exercise price is $1.28 so that suggests based on the share price the warrants might start trading about 23 cps.

What are they really "worth" though ?, (that's the real $64,000 question ?), with NTA at ~ $1.22 less any losses this week (US markets down about 1% for the week).

To answer that question one must consider what premium if any is it fair and reasonable that Marlin trade above NTA and that's another really thorny question.

People will arrive at different answers to this last question and much will depend upon how much value each individual ascribes to the PIE investment structure, the 8% annual tax free dividends, the regular warrant issues, the international diversification this fund gives them as well as the peace of mind of having some of their portfolio managed by excellent fund managers and last and by certainly no means least the fact that the investment team have on average beaten the index after all fees expenses and taxes by over 7% per annum over the last 3 years, (no easy feat by any means).

Each person will need to work that out for themselves but I observe that if one accepts that a 15% premium to NTA is okay considering all of the above and any other pertinent factors, (about 2 years managers outperformance) one will still get just on 7% tax free in dividends (= ~11.5% gross for 39% taxpayers) in which case the shares are worth about $1.40 ($1.22 x 1.15) and the warrants about 12 cents.

Two other observations I would like to make is that the price premium to NTA started as a result of once in a generation low interest rates last year BUT has really accelerated since then to an unprecedented level since Cindy and Grant announced their "interesting" moves on rental property investors.

In my opinion it is not unreasonable to conclude that this very recent phenomenon of trading as high as a 38% premium to NTA recently for this and BRM is a reaction to socialist policies and some investors are very, very keen to diversify their investments offshore, especially if a very high yield is on offer.

How long these very high premiums to NTA remain will be interesting to see. While many on here including myself can easily replicate the portfolio of BRM and Marlin and handle the tax matters themselves (or with professional help) I have observed that most attendees at annual meetings for these companies are quite elderly and just want to be "looked after".

Interesting times for BRM and Marlin share and warrant holders.

Above is just food for though, no perfect answers, just what works for you and what you are prepared to pay.

[alokdhir]

Current Nav is 1.22 ...SP is 1.51 ...Expected warrant exercise price is 1.28- 0.10 = 1.18

Keeping the above in picture and seeing how the current BRMWF trading ....my expected warrant price trading range to start with is 15 cents to 20 cents . Anything over it will be overpriced compared to head share .

All previous warrants have always traded below Head shares current SP after deducting divvies . BRM = 1.03 ...BRWF = 0.28 ...2 dividends still pending so appox $1 SP after deducting 2 further dividends before exercise date . Expected exercise price is 0.70 - 0.06 = 0.64 ...so 64 + 28 = 92 cents ...8 cents discount to current SP ...just an example how market prices warrants ...it depends upon current SP of headshare and some discount to it after deducting expected dividends till exercise date from current SP

Premium over NAV is a new phenomenon and it has various reasons going for it ...not easy to figure out how long they will last ...actually quite challenging to grapple with this problem ...as in first downturn they will evaporate very fast thus hitting SP twice as fast as just market movement

[Vee Vee]

Yes the evaporating premium effect is why I sold my BRM and MLN. I don't want to pay over NTA by that much and don't like the exposure to dilution with the new issue.
Shame as I like MLN in particular, good holdings.
The warrant and new issue merry go round makes the whole affair overcomplicated though.

[alokdhir]

Yes the evaporating premium effect is why I sold my BRM and MLN. I don't want to pay over NTA by that much and don't like the exposure to dilution with the new issue.
Shame as I like MLN in particular, good holdings.
The warrant and new issue merry go round makes the whole affair overcomplicated though.

I am still trying to figure out how to keep holding KFL while not letting dilution via warrants hit me ...Maybe holding warrants till the last month will help minimise that risk of dilution if u dont want to exercise all your warrants ...not easy if u have large holdings .

I like KFL and its portfolio is superb ...all winners and NZ market is underperforming others ...so when it catches up then KFL will do well ...also expecting its new warrant issue in next 3 months so that should bring excitement to the SP ...MFT / FPH / RYM results due soon ...should help KFL .

[Beagle]

So...we have a range of as low as 12 cents to as high as 25 cents, mid point 18.5 cents.

It will be interesting to see how the market sees them.

[777]

Above 25. Below 35.

[Sideshow Bob]

Due to start trading Monday, any guesses at price given all the stocks in Fisher stable are trading at premium to NTA my guess is 25c

Looks like it is 'expected' to start trading tomorrow - Quotation Notice - Marlin Global Ltd ("MLNWE") Warrants - NZX, New Zealand’s Exchange

[Beagle]

Awesome...gives me one more day to try and more closely define my theoretical valuation. I'd buy truckloads at 7 cents if they list where Barramundi warrants did, (sigh...oh my goodness that was fun)

[winner69]

Do punters sell their warrants as soon as they get them because they are free and they in for a quick buck?

Or is it they just don’t really understand what’s going on?