Man you must be desperate to buy more KFL..
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Man you must be desperate to buy more KFL..
Spend some money and get expert advice. In my opinion, if borrowing, I would not bother deducting the interest because it's is a transaction that draws attention by the IRD to to all your share dealings.
All shud be ...many reasons to be desperate ...Markets are depressed as rates high so valuations are low ...but rates wont stay high forever we all know
Secondly its at steep discount to NAV which also will reverse over 2-3 years period
Thirdly it has a great portfolio which will surely do well ahead
Also its a fund and not a single company share so risk is very mitigated
IMHO buying KFL now will bear great returns in next 2-5 years ahead
When it was trading 22 cents premium to NAV I was dead sure its a SELL ....but now I am dead sure it's a BUY ....Rest is DYOR stuff
Alokdhir, i think its good buying at these levels but thats it. imo no way are we close to borrowing money to buy at these levels. Not even close to thinking about it tbh.
Come on we havnt even had the capitulation event yet... the pig farmer isnt buying..
Maybe it depends what sectors you invest in? Most of my NZX shares I hold are at lower prices than they were a year ago. But when I look at my utility category investments, in gentailers and telecommunications companies, are they cheap, in terms of yield? Definitely not. I have been looking very seriously at my holdings in this space with a view to adding, and I just can't find value.
Then I go across to my 'clever exporters' Scott Technology and Skellerup. Both doing well but a PE of 15 is the starting point for getting into those. Definitely not cheap. Then I go across to my PGG Wrightson investment, supporting our farmers. If you forget last years blip upwards, it is still trading near all time highs from a PE ratio perspective. It is much closer to a 'reduce' price rather than an 'accumulate' price IMV.
I go across to Turners which I regard as a well run company. The share price is down a bit, but big ticket items generally do not do well going into a recession.
I have never invested in the retirement sector myself, because frankly I have difficulty understanding it. I cast my eye to offshore markets and don't see a plethora of high flying equivalents to Ryman and Summerset and ask myself, why is that? Why are these businesses rated so much more highly in NZ compared to elsewhere? I have a feeling it is due to the favourable tax treatment of property in NZ fuelled by (up until a year ago) twenty years worth of falling interest rates. Day to day cashflow in these businesses is actually pretty awful. You can judge 'real profit' by how much tax these companies pay.
So yes, lots of companies trading at lesser prices than a year ago. But looked at on a price on taxable earnings basis I don't see 'cheap'. In fact I see the NZX right now, as a collective, as rather overvalued.
SNOOPY
My observation was mainly based on stocks in the KFL portfolio ...ie FPH / IFT / MFT / AIA / SUM ..etc ....Most of them are attractively priced individually too ....then getting them at 8.5% discount to current market prices ...makes them extra attractive to me at least .
History has shown KFL being a retail stock gets into limelight when markets are buoyant and looses its shine in downtrend which adds to further attractiveness at the moment .
KFL was trading at 22 cents premium in Jan 2021 ...market peak ....now it's at almost 13 cents discount ...in itself it's almost 20% gap to close as and when it gets closed in next 2-5 years ...while one waits ....we get dividends or distributions based on NAV and not current SP ...
A bit of self adulation in KFL newsletter with this headlines” We fought for a better outcome in the Pushpay takeover battle”. Good they fought the good fight
But had little faith in Push management so happy taking the money.
KFL must be close to looking at MHJ as an addition to their portfolio.
Currently just fails the T(rack record) and E(arnings history) of STEEPP investment style.
Pass with flying colours S(trength of the business), E(earnings growth forecast), P(eople/management) & P(price/valuation.
Maybe get there in next few years.
Thoughts?
A potential near term Warrant issue is another current attraction for buyers of KFL currently.
Someone earlier in this thread asked if there is any (IRD) concern if Warrants are issued too frequently that impinges on the Managers ability to do so. I didn't see a response to that. Is it only acceptable once every two years, which seems to be pretty much what happens in practice? Does anyone have any insight?