Author Topic: Dumbdee - The Goodmans, The Bad & The Ugly - 30% of NAV bargain?  (Read 97676 times)

obtuse_investor

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Re: Dumbdee - The Goodmans, The Bad & The Ugly - 30% of NAV bargain?
« Reply #210 on: June 07, 2018, 02:47:39 PM »

Of course there's very likely not enough liquidity for them to buy much anyway, and I don't know the costs of maintaining a buyback program. Maybe those are big factors. But my guess is that they overestimate their ability as investors/businessmen and are simply being irrational.

From what I have observed; Canadian listed entities with low liquidity end up doing a tender offer to draw out the impatient motivated sellers.

If the management offers low liquidity as the reason for the lack of buybacks, you can be sure they don't want to buy back shares. Where there is a will, there is a way. 
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SafetyinNumbers

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Re: Dumbdee - The Goodmans, The Bad & The Ugly - 30% of NAV bargain?
« Reply #211 on: June 07, 2018, 03:01:58 PM »
I pushed him on buying back the pref over the common primarily because it reduces future cash outflows and is effectively a risk free after tax return (to them) of over 12%.

The catalyst here could be whatever Delonex ends up reporting. That royalty could be a home run.

Agreed on Delonex.  Apparently they expect a well to be drilled this calendar year, so a reasonably near term potential catalyst.

Do you mind sharing his response to being pushed on the prefs?  I understand the company not buying back the common at this point.  I don't understand insiders staying out of the market -- not even a nibble -- and I really don't understand why the company doesn't at least make an attempt at taking out some of those prefs.  Instead, they're talking about building out a merchant banking business.  Do they seriously think they can outlay capital in any manner that competes with the risk-free return they'd get from buying the prefs?

Of course there's very likely not enough liquidity for them to buy much anyway, and I don't know the costs of maintaining a buyback program. Maybe those are big factors. But my guess is that they overestimate their ability as investors/businessmen and are simply being irrational.

The pushback was mainly that capital is finite and that they need the liquidity for paying off the DC.PR.E (which by the way shows no fear like the rest of the capital structure does) and running the business. I think they are just afraid of spending the capital on enhancing shareholder value in the short term and then having to do something dilutive later on.

He did say that he is considering buying some common and preferred personally but didnít say what he was waiting for.
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Rod

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Re: Dumbdee - The Goodmans, The Bad & The Ugly - 30% of NAV bargain?
« Reply #212 on: June 12, 2018, 05:59:12 AM »
You can hear audio of the AGM at this link:

https://www.youtube.com/watch?v=5xsFtnIBLYI

Commentary and Q/A begin at 10 minute mark.

Sportgamma

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Re: Dumbdee - The Goodmans, The Bad & The Ugly - 30% of NAV bargain?
« Reply #213 on: June 12, 2018, 07:55:59 AM »
You can hear audio of the AGM at this link:

https://www.youtube.com/watch?v=5xsFtnIBLYI

Commentary and Q/A begin at 10 minute mark.

The old guy at the meeting was pretty funny. 

doc75

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Re: Dumbdee - The Goodmans, The Bad & The Ugly - 30% of NAV bargain?
« Reply #214 on: June 12, 2018, 09:12:38 AM »
You can hear audio of the AGM at this link:

https://www.youtube.com/watch?v=5xsFtnIBLYI

Commentary and Q/A begin at 10 minute mark.

The old guy at the meeting was pretty funny.

Yeah that was something.  He's probably been on quite the return trip with his Dundee shares.

Volume has really picked up the past couple days in this $1.65-$1.70 range.  It'll take a while to clear a big holder who wants out.

SafetyinNumbers

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Re: Dumbdee - The Goodmans, The Bad & The Ugly - 30% of NAV bargain?
« Reply #215 on: June 12, 2018, 11:21:05 AM »

Yeah that was something.  He's probably been on quite the return trip with his Dundee shares.

Volume has really picked up the past couple days in this $1.65-$1.70 range.  It'll take a while to clear a big holder who wants out.

Probably the guy who asked about the share buyback.
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petec

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Re: Dumbdee - The Goodmans, The Bad & The Ugly - 30% of NAV bargain?
« Reply #216 on: June 19, 2018, 05:23:26 AM »
DC.PR.E (which by the way shows no fear like the rest of the capital structure does).

That's because they're puttable, which in effect means they rank senior to the other prefs. The YTM would be sky high if they traded much below par!

Interestingly they are also convertible at the company's option into common at the current price, which enhances the value of the other prefs IMHO and is potentially very dilutive to the common given the current market cap.

Rod

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Re: Dumbdee - The Goodmans, The Bad & The Ugly - 30% of NAV bargain?
« Reply #217 on: June 19, 2018, 05:36:41 AM »
DC.PR.E (which by the way shows no fear like the rest of the capital structure does).

That's because they're puttable, which in effect means they rank senior to the other prefs. The YTM would be sky high if they traded much below par!

Interestingly they are also convertible at the company's option into common at the current price, which enhances the value of the other prefs IMHO and is potentially very dilutive to the common given the current market cap.

Actually the E shares are convertible into common at the current price or $2, whichever is greater. You might think the E holders would be a little worried about that with the common currently below $2.

petec

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Re: Dumbdee - The Goodmans, The Bad & The Ugly - 30% of NAV bargain?
« Reply #218 on: June 19, 2018, 05:43:23 AM »
Does anyone know much about TauRx? I am struck by the carrying valuation - both in that it is significant, suggesting real value is present (despite poor trials results) and in that it is discounted by 50%, suggesting rapid potential upside if the discount is removed.

Could be a zero, could be a hero, and I have no idea which. Does anyone?

doc75

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Re: Dumbdee - The Goodmans, The Bad & The Ugly - 30% of NAV bargain?
« Reply #219 on: June 19, 2018, 05:47:12 AM »
DC.PR.E (which by the way shows no fear like the rest of the capital structure does).

That's because they're puttable, which in effect means they rank senior to the other prefs. The YTM would be sky high if they traded much below par!

Interestingly they are also convertible at the company's option into common at the current price, which enhances the value of the other prefs IMHO and is potentially very dilutive to the common given the current market cap.

Actually the E shares are convertible into common at the current price or $2, whichever is greater. You might think the E holders would be a little worried about that with the common currently below $2.

Given that they're sitting on a bunch of liquid investments, I find it hard to believe that they'd dilute their own holdings in the common to pay off the E's.    I'm sure they don't want to sell off much DPM, but if it's a choice between that and diluting the hell out themselves, I think they would sell.   

I haven't read the E prospectus lately: can they do a hybrid thing, part cash part equity?