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The idol has clay feet
Have not looked at PTM since my several posts around the time of the float. Am not surprised to see its steady decline ever since. The IPO generated totally unrealistic expectations, Kerr Neilson became a billionaire overnight, the stags did exceptionally well, but the poor unfortunate "believers" have been left holding the baby and wondering why it all went so wrong.
I became disillusioned with Platinum Capital (PMC) some time ago, have since ditched all my holdings, and won't be going near Mr Neilson again. I believe he has had his heyday. (Perhaps Ron Brierley has had his too - I have been steadily unloading GPG).
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PTM now trading at a discount to its peers
I've updated the peer comparison I did six months ago to determine fair value for PTM at the IPO. Average consensus 08PE for the six listed fund managers is 19, PTM trades at 17. I'm not overly surprised PTM has ended up trading at a discount since the performance of its funds has been below par in recent times. Having said that, I still think fair value is $6 - $6.50, trading at a small discount until PTM proves its credentials as a listed fund manager. I also note that the share prices of all the listed fund managers has basically gone nowhere in the past six months.
SEC
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Member
PTM generally has a large short position in its funds, so if we see a market downturn they should outperform. I would see it as being a strong defensive stock.
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Member
Here, for what it's worth, is ASB Securities' take on PTM, as printed in their October newsletter:
"PTM's FUM fell by cA$750m (3.4%) in Setember, including the loss of a $131m institutional mandate that is expected to withdraw a further A$487m in October. PTM's valuation is highly sensitive to FUM growth and the recent collapse and snap-back in markets has been difficult given the company's value focus. The strengthening A$ is further hampering FUM growth. However, while cautious about near-term prospects, we continue to favour PTM for the following reasons:
1. PTM's rigorous and successful investment approach is ingrained in the culture of the organisation.
2. PTM is positioned in one of the fastest growing segments of the Australian fm market (international equities) and should be considered a growth company.
3. PTM has none of the liquidity constraints that hamper growth and performance perceptions of large Australian equity managers.
4. PTM has sufficient scale to support a top quality investment team and the systems to handle FUM growth.
5. PTM has a strong long-term investment track record.
6. PTM's revenue mix has little reliance on volatile relative performance fee income. Rather the bulk of performance fee income is determined by absolute performance (i.e. earning a positive return).
Any wiser?
ASB's recommendation is: Accumulate/ Market Perform
Last edited by Lawso; 31-10-2007 at 02:25 PM.
Reason: Adding extra comment
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FUM at the end of October down over $700m from a month earlier.
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Member
What a disaster
PTM down again today. 508 latest with little buying interest apparent. What a disaster, esp. for those who bought in post-float at $9 or thereabouts.
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There'll be a time to buy PTM but it isn't yet!
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i dunno eh.....
i just dunno.......
the FUM going down is not a good sign at all...
Oil - NZO
REE - ARU
Copper - EQN/OXR/TMR
Iron- AGO/ADY/UMC
Nickel-WSA
PGM/Gold - PLA/VRE
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Member
There'll be a time to buy PTM but it isn't yet!
I'm looking for a time to SELL but it isn't yet!
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A masochist indeed!
Originally Posted by Lawso
I'm looking for a time to SELL but it isn't yet!
Why, oh why, have you kept riding this one down?! The graphs say it all, even to non TA experts like me.
It took me a long time to learn a couple of basic but valuable lessons in equity investing:
1. Buy into strength, and sell into weakness.
2. Cut your losses, let profits run.
I know that these cardinal rules have been stated time and time again, but they need to be repeated ad nauseum.
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