Discount to NAV has been about current levels for a while .....what's going to change that?
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Discount to NAV has been about current levels for a while .....what's going to change that?
Yeap I "hounded up" a few and appreciate your earlier comments regarding the size of the discount to NTA. Warrants exercise price is 83 cents in April 2019 adjusted for dividends paid on the shares in the period from issue until exercise. The way I read it the adjusted exercise price is just on 81 cents now taking into account the June 2018 dividend paid of nearly 2 cps. 1:4 was the issue ratio so NTA of MLN shares needs to be adjusted for future dilution of the exercise of the warrants in due course. Warrants give a lot of bang for buck if the markets head north but could be worthless if the opposite happens. We should know whether this trade war talk is just that, talk, or something far more serious well before April 2019 so I like the optionality the warrants give in terms of exposure to a significant investment in overseas shares without outlaying much money now. I'm not going to try and value the warrants other than to point out that the exercise price keeps going down every time MLN pays a dividend so you get a free carry in terms of the optionality aspect, i.e. exercise price + current warrant price is slightly less than the current share price. My gut tells me the warrants are cheap and the shares a little bit cheap. Wouldn't mind another 100K but probably have to pay more after this post lol
Should you find yourselves getting excited,the MLN 10 year chart should cool you off a bit..!!...lol.
Take care.
Good points - I have shares in AFI and they trade around NTA so the 16% with MLN seems to be excessive. I got some free warrants and they have recently found a few more buyers which has given them a nice boost.
Just as well you guys Balance is on holiday at the moment
He would be adding to the discussion
A large part of that discount to nav is the future value of those excessive performance fees
Big volume today and nice rise in the warrants - market seems to have woken up to value, next the head shares...