KFL - discount to diluted NAV

[winner69]

The discount to NAV is about $35m

Some might say that’s the present value of future management and performance fees

Those same punters would say that seems about right só discount is warranted

[winner69]

Hey alokdhir

As you master of all things Kingfish you wouldn’t have any historical data as to what the discount has been over the years would you

[Grimy]

I was happy enough to pick up a few this morning.

[Rawz]

Ive got a mate buying $50 of these and BRM each week via sharesies ($3 brokerage cost per month on one of their plans).

If the SP goes to par or above NAV ill tell her to stop.

Good value here and easy peasy investing imo.

[alokdhir]

Hey alokdhir

As you master of all things Kingfish you wouldn’t have any historical data as to what the discount has been over the years would you

I have been invested from April 2010 and SP was average 91 Cents with NAV around $ 1.10 ...thus huge discount ...at that time buy back kicked in after 10% discount ....it took a while for that discount to narrow ...many years I reckon ...but then it became normal for SP to be few cents discount to NAV and discount widened only around warrant exercise time ie around a month before and few after ...ONLY after Covid times we saw huge premium ...very unusual and very unhealthy ...but I reckon money lost total value and anything else was better ...people just wanted to get rid of cash at any price .

Also maybe market in its wisdom sees this as a Bond of some sort thus repricing its discount / premium compared to current rates ...its portfolio of well established blue chips can give some level of security to treat whole portfolio as a Bond !!!

https://kingfish.co.nz/investor-cent...announcements/

From above u can get NAVs and discounts since 2007

[alokdhir]

Still buying own shares

Neighbour asked me if they have spare cash why don’t they buy more FPH or Vulcan shares if they think those companies are so good?

I said ‘financial engineering’

Hecsaid what to benefit the managers by making themselves look good

What do I really tell him …please …in simple words

Buyback is only for OPTICS ...its value is minuscule to alter SP on any day ...its just trying to signal to potential buyers that its good value at current prices ...

I wanted them to control premium during covid fundays when it was trading over 20 cents to NAV ...but being close ended fund ...they can only buyback but not issue new shares as market maker ...thus many got burnt badly but maybe they still better off then buying Bond funds / treasuries at that level !!

[alokdhir]

Ive got a mate buying $50 of these and BRM each week via sharesies ($3 brokerage cost per month on one of their plans).

If the SP goes to par or above NAV ill tell her to stop.

Good value here and easy peasy investing imo.

Great way to invest and great advise mate ...almost certain to succeed without much risk ...

[alokdhir]

The discount to NAV is about $35m

Some might say that’s the present value of future management and performance fees

Those same punters would say that seems about right só discount is warranted

This cud have been true if all 3 ie KFL / BRM / MLN traded at same discount as all have similar fees structure ....at present discounts are 9% / 4% / 5% ....

PS : Also this explanation doesn't fit premiums to NAV which were present for almost 18 months !!!

If u invest funds with ANZ Private kind of wealth managers ...then they upfront charge u portfolio establishment fees ...where as if u buy KFL ...u get great and established portfolio at 9% discount

[winner69]

Friend had some old monthly data and I’ve updated ……..discount/premium to NAV last 10 years. It’s month end data

The red line is the important one …..others are average abd std deviations. These are used to calculate a thing called a Z-score which funds dealing in trusts etc use as buy sell signals.

KFL definitely a buy at current levels based on these numbers.

Is interesting what’s happen over the last 10 years it generally trades at discount to NAV but highlights that like many things over 2020/2022 got out of kilter …..and KFL was no exception and like many reverting to a more normal state.

I also tend to agree with alokdhir in that KFL is seen by many as a ‘bond’ and as such divie yield is a key driver of share price….probably stay that way for a while.

[mshierlaw]

Friend had some old monthly data and I’ve updated ……..discount/premium to NAV last 10 years. It’s month end data

The red line is the important one …..others are average abd std deviations. These are used to calculate a thing called a Z-score which funds dealing in trusts etc use as buy sell signals.

KFL definitely a buy at current levels based on these numbers.

Is interesting what’s happen over the last 10 years it generally trades at discount to NAV but highlights that like many things over 2020/2022 got out of kilter …..and KFL was no exception and like many reverting to a more normal state.

I also tend to agree with alokdhir in that KFL is seen by many as a ‘bond’ and as such divie yield is a key driver of share price….probably stay that way for a while.

A most excellent chart, many thanks for sharing. The picture tells a 1,000 words.