KFL - discount to diluted NAV

[Beagle]

It is common for listed investment companies such as Kingfish to have a share price that is different to the NAV per share. Where the share price is lower than the NAV per share, the shares are said to be trading at a discount. Where the share price is higher than the NAV per share, the shares are trading at a premium. There can be many reasons for the shares trading at a value different to the underlying NAV including expectations of future earnings and market sentiment.

From Kingfish Q&A on their website. https://www.kingfish.co.nz/investor-centre/faqs/

[justakiwi]

Yes, I understand that, but how do I as a shareholder know whether the premium to NAV is justified? Some here have said it is not, so they no longer hold. Just trying to understand how one comes to that decision.

From Kingfish Q&A on their website. https://www.kingfish.co.nz/investor-centre/faqs/

[iceman]

Yes, I understand that, but how do I as a shareholder know whether the premium to NAV is justified? Some here have said it is not, so they no longer hold. Just trying to understand how one comes to that decision.

Like Beagle said there can be many reasons for it and different beliefs on future growth. So you will never “know” if it is justified, you will only know what you belief after doing your research and assumptions.


After all, successful trading is like getting pregnant. Everyone congratulates you when you manage it but no one asks how many times you got ****ed first.

[justakiwi]

After all, successful trading is like getting pregnant. Everyone congratulates you when you manage it but no one asks how many times you got ****ed first.

[Beagle]

Like Beagle said there can be many reasons for it and different beliefs on future growth. So you will never “know” if it is justified, you will only know what you belief after doing your research and assumptions.


After all, successful trading is like getting pregnant. Everyone congratulates you when you manage it but no one asks how many times you got ****ed first.

That's got to be the quote of the day

[Beagle]

Yes, I understand that, but how do I as a shareholder know whether the premium to NAV is justified? Some here have said it is not, so they no longer hold. Just trying to understand how one comes to that decision.

Very few managed funds in the world trade at a premium to NTA. Only those that have consistently proven they can outperform their benchmark index can sometimes attract a small premium. You can make a case that the Kingfish group as a whole have performed exceptionally well so could possibly be worth a very modest premium to NTA. I think its better to try and buy at a discount to net tangible asset backing though.

[Beagle]

Can’t keep KFL down for long

Seems market thinks it deserves to trade at a premium to NAV

(Need to change thread title)

It seems that way. Market must think the investment team at KFL are guru's.

[GTM 3442]

Funds should, theoretically, trade at NAV less fees. But sometimes it's tricky o establish NAV. And of course they don't always do so.

Put it down to "star quality" in the management team, especially the manager - you can see this "star manager" cult quite clearly in the UK.

Neil Woodford is probably the best known example (no longer for good reasons), but the Lindsell Train funds certainly command a premium to NAV, as do a number of others.


https://www2.trustnet.com/Managers/A...dDirection=Asc

https://www2.trustnet.com/Managers/M...00287DW&univ=O

[Ggcc]

$1,76 now. I bought a few just under $1.50 and this price seems to wow me what people want to pay for a high dividend stock. I guess with current valuations of FPH, ATM, SUM, PPH IFT and Mainfreight constantly climbing to new heights. This justifies the too high share price. I also believe when the results come out from ATM, the KFL share price will hit $1.80 if all looks good with ATM.

Of course DYOR

[caveman]

Presumably the dramatic sudden price offered for KFL in the last 2 days is due to the record date for allocation of warrants, not just a dividend? However, it doesn't make sense to me to pay such a premium (170c vs 161-162 NTA).... the volumes are relatively high too...