sharetrader
Page 72 of 106 FirstFirst ... 226268697071727374757682 ... LastLast
Results 711 to 720 of 1059
  1. #711
    ShareTrader Legend Beagle's Avatar
    Join Date
    Jul 2010
    Location
    Auckland
    Posts
    21,362

    Default

    Quote Originally Posted by tim23 View Post
    You have to deduct any dividends so the exercise price will be about 65c so you may have to revise your estimates.
    Yeah I mucked that up. I will have another look at assessing fair value for the warrants in due course.
    Ecclesiastes 11:2: “Divide your portion to seven, or even to eight, for you do not know what misfortune may occur on the earth.”
    Ben Graham - In the short run the market is a voting machine but in the long run the market is a weighing machine

  2. #712
    ShareTrader Legend Beagle's Avatar
    Join Date
    Jul 2010
    Location
    Auckland
    Posts
    21,362

    Default

    Reworked everything up to yesterday based on estimated current NTA of BRM @72.6 cps, (last reported NTA last week adjusted for movement in the ASX index since then as a proxy for how their underlying NTA might have moved since the last NTA was announced). Assuming BRM shares perform in the year to late October 2021 at a rate of 8%, enough so their NTA stays static and they pay out 5.76 cps in dividends the exercise price of the warrants with be 64 cents. On a straight arithmetic basis this suggests the warrants have a fair value of 72.6 c - 64 cents = 8.6 cents.

    It should be noted that upon exercise the NTA will be slightly diluted and also noted that the optionality of the warrants has some value, i.e. one doesn't have to exercise them if the market performs very poorly between now and late October 2021 but contemporaneously one has exposure to unlimited upside in the Australian portfolio BRM has.

    All things considered I see fair value of the warrants at 9 cents.
    Disc: I bought some yesterday and am on the bid for more.
    Last edited by Beagle; 07-10-2020 at 09:50 AM.
    Ecclesiastes 11:2: “Divide your portion to seven, or even to eight, for you do not know what misfortune may occur on the earth.”
    Ben Graham - In the short run the market is a voting machine but in the long run the market is a weighing machine

  3. #713
    Member
    Join Date
    Nov 2018
    Posts
    50

    Default

    Quote Originally Posted by Beagle View Post
    Reworked everything up to yesterday based on estimated current NTA of BRM @72.6 cps, (last reported NTA last week adjusted for movement in the ASX index since then as a proxy for how their underlying NTA might have moved since the last NTA was announced). Assuming BRM shares perform in the year to late October 2021 at a rate of 8%, enough so their NTA stays static and they pay out 5.76 cps in dividends the exercise price of the warrants with be 64 cents. On a straight arithmetic basis this suggests the warrants have a fair value of 72.6 c - 64 cents = 8.6 cents.

    It should be noted that upon exercise the NTA will be slightly diluted and also noted that the optionality of the warrants has some value, i.e. one doesn't have to exercise them if the market performs very poorly between now and late October 2021 but contemporaneously one has exposure to unlimited upside in the Australian portfolio BRM has.

    All things considered I see fair value of the warrants at 9 cents.
    Disc: I bought some yesterday and am on the bid for more.
    Mr B how do you buy more warrants?

  4. #714
    ShareTrader Legend Beagle's Avatar
    Join Date
    Jul 2010
    Location
    Auckland
    Posts
    21,362

    Default

    Quote Originally Posted by FatTed View Post
    Mr B how do you buy more warrants?
    BRMWF is the ticker code.
    Ecclesiastes 11:2: “Divide your portion to seven, or even to eight, for you do not know what misfortune may occur on the earth.”
    Ben Graham - In the short run the market is a voting machine but in the long run the market is a weighing machine

  5. #715
    ShareTrader Legend Beagle's Avatar
    Join Date
    Jul 2010
    Location
    Auckland
    Posts
    21,362

    Default

    Updated valuation as of close of business Friday based on last reported NTA of 73.44 cents on 8/10/20 and adjusted for estimated NTA as at close on Friday, index up by ~ 1.4% since then, estimated NTA is thus ~74.5 cps. Estimated exercise price of warrants on 29/10/21 is assumed to be 64 cents, fair value is this thus 10.5 cps.

    I like these warrants because they give good diversification to the Australian market with a good spread of interesting companies in their portfolio. It gives all the potential upside on about 74.5 cps of share value but only on an outlay of around 9 cents so your downside is limited. I think we should (in theory at least) have a better handle on the vaccine situation and recovery prospects by the end of October next year. Barramundi have been significantly outperforming the ASX in recent years as you can see here https://www.barramundi.co.nz/investo...o-performance/

    More on their current portfolio holdings here https://www.barramundi.co.nz/investo...olio-holdings/

    I think there's real value in the optionality these warrants confer, (and also real value to me that they comprehensively beat the index so I don't have to invest truck loads of time doing analysis on Australian companies), so I bought a significant number in this, their first week of being listed.
    Last edited by Beagle; 11-10-2020 at 12:45 PM.
    Ecclesiastes 11:2: “Divide your portion to seven, or even to eight, for you do not know what misfortune may occur on the earth.”
    Ben Graham - In the short run the market is a voting machine but in the long run the market is a weighing machine

  6. #716
    Member
    Join Date
    Nov 2013
    Posts
    75

    Default

    Quote Originally Posted by Beagle View Post
    Estimated exercise price of warrants on 29/10/21 is assumed to be 64 cents, fair value is this thus 10.5 cps.
    But the email from Barramundi says:
    $0.70 NZD per Warrant adjusted down for cash dividends declared on shares with a record date during the period commencing on the date of allotment of the warrants and ending on the last business day before the announcement of the final exercise price.
    I've read that sentence several times, but I cannot for the life of me figure out what it means. Presumably, that's the 6c difference between their 70c and your 64c.
    Can you explain to an amateur investor how this works?

  7. #717
    ShareTrader Legend Beagle's Avatar
    Join Date
    Jul 2010
    Location
    Auckland
    Posts
    21,362

    Default

    In a nutshell, BRM will pay 4 quarterly dividends of 2% of the NTA of the shares during the life of these warrants. With their NTA currently at around 73 cents 4 x 2% x 74 cents = 5.92 cents so my expectation is that the final exercise price of the warrants will be adjusted down for the 4 dividends paid on the shares totaling about 6 cents so my estimate of the final warrant exercise price is 64 cents.

    A very simple way to value the warrants is to take the current share price 78 cents less the expected future exercise price of 64 cents and you get 14 cents but this is too simplistic as the current share price exceeds NTA. Why would the shares trade above NTA one might ask ?

    Three possible explanations are apparent.
    1. The fund has beaten the index so comprehensively in recent years shareholders are prepared to pay a premium over NTA to get the shares. In this case this suggests if this remains then the warrants are indeed worth 14 cents.
    2. The market is yield starved and absolutely loves the 8% tax free PIE yield of these shares = (12% gross for people on a 33% tax rate) and is therefore prepared to pay a premium over NTA to get this yield. If this remains then again, the warrants present as being worth more than 10.5 cps.
    3. Kiwi shareholders are really keen to get some decent and easy diversification into the Australian market.

    I prefer the NTA approach which suggests fair value of 10.5 cents but there is a case to be made that the warrants are worth 14 cents.
    Last edited by Beagle; 12-10-2020 at 09:28 AM.
    Ecclesiastes 11:2: “Divide your portion to seven, or even to eight, for you do not know what misfortune may occur on the earth.”
    Ben Graham - In the short run the market is a voting machine but in the long run the market is a weighing machine

  8. #718
    ShareTrader Legend Beagle's Avatar
    Join Date
    Jul 2010
    Location
    Auckland
    Posts
    21,362

    Default

    http://nzx-prod-s7fsd7f98s.s3-websit...876/333422.pdf

    Since coming on board as the senior portfolio manager a few years ago Robbie and his team have absolutely nailed it and really thrashed the ASX index in terms of BRM's relatively MUCH stronger performance.

    I will be attending he annual meeting tomorrow and will make a point of thanking him for his outstanding performance over the years.
    Its clear to me this guy and his team have real skills in the Australian market I don't have so I am more than comfortable relying on their expertise.
    Disc: Shareholder and I hold a significant number of Barramundi warrants (BRMWF).
    Ecclesiastes 11:2: “Divide your portion to seven, or even to eight, for you do not know what misfortune may occur on the earth.”
    Ben Graham - In the short run the market is a voting machine but in the long run the market is a weighing machine

  9. #719
    ShareTrader Legend Beagle's Avatar
    Join Date
    Jul 2010
    Location
    Auckland
    Posts
    21,362

    Default

    http://nzx-prod-s7fsd7f98s.s3-websit...972/333485.pdf

    I attended the annual meeting today and was very impressed with their presentation and especially impressed with their performance for the year ended 30 June 2020 in which their fund outperformed the ASX index by an incredible 19% ! Had a good chat with their chief investment office Robbie Urquhart afterwards. Nice guy and I think he and his team are right on top of their game. Very happy investor and enjoyed a nice lunch they put on after the meeting too.
    I'm planning on accumulating more warrants from time to time and increasing my stake in Barramundi over the course of the next year or so.
    Last edited by Beagle; 23-10-2020 at 02:31 PM.
    Ecclesiastes 11:2: “Divide your portion to seven, or even to eight, for you do not know what misfortune may occur on the earth.”
    Ben Graham - In the short run the market is a voting machine but in the long run the market is a weighing machine

  10. #720
    Senior Member
    Join Date
    Nov 2009
    Posts
    746

    Default

    Quote Originally Posted by Beagle View Post
    http://nzx-prod-s7fsd7f98s.s3-websit...972/333485.pdf

    I attended the annual meeting today and was very impressed with their presentation and especially impressed with their performance for the year ended 30 June 2020 in which their fund outperformed the ASX index by an incredible 19% ! Had a good chat with their chief investment office Robbie Urquhart afterwards. Nice guy and I think he and his team are right on top of their game. Very happy investor and enjoyed a nice lunch they put on after the meeting too.
    I'm planning on accumulating more warrants from time to time and increasing my stake in Barramundi over the course of the next year or so.
    Fisher funds do a good job although I’m not so sure on ANZ! I used to own kingfish marlin and barramundi

    What’s the advantage of warrants? Dead cost if you don’t exercise them. I must be missing something??? Can you please explain the logic behind warrants rather than purchasing shares directly

Tags for this Thread

Bookmarks

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •