Originally Posted by
Baa_Baa
Well not 'nobody', there's a few who get it.
Unfortunately current accounting principles and practices fail to recognise that the accumulated revenue is only repayable in a lessor percentage (the remains are float), and are repeatable and grow, ad infinitum, and ergo the withholdings or retained revenues are assets (albeit held as liabilities on the balance sheet under current accounting practices), that can be and are leveraged, interest free, into growth of the asset base.
Really, the fundamental value proposition of these RV's seems to be largely misunderstood which imo is surprising as the business model has been in play for decades. It must be imo because accounting practices do not or fail to account, for the value of the withholdings (retained earnings) and put them on the opposite side of the balance sheet ledger than where they in reality belong.
Like you say, there's circa a billion dollar of assets (cash) that is withheld and retained, but perversely, reported as a liability. WTF, it's insane. And people get upset about SP ratio to NTA, without realising NTA is, under current accounting practices devalued by ~a billion $
If they added those withheld/retained earnings, as assets, which they should, then the SP is massively below NTA/NAV, way more than the current 50% discount or thereabouts. Which makes the SP massively underpriced.
Go figure. It makes no sense. The beanies have control of the narrative when reality is far from it.