Author Topic: ELF.TO - E-L Financial Corp. Ltd.  (Read 52222 times)

ColdandRich

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Re: ELF.TO - E-L Financial Corp. Ltd.
« Reply #130 on: September 14, 2019, 08:24:52 AM »
They reported last month, and NAV was up to $1,397.35, with the stock trading as low as $720 in the past couple of weeks. A record discount (?) of 52% of NAV.

Continue to be shocked that they don't buyback some of their shares, would be so accretive at these levels.

I heard a theory that they like the discount because they will avoid a bunch of taxes when Henry Jackman passes away. I think he is 87 now. I assume they already did an estate freeze once when they sold the Dominion back in 2013. The NAV was $872.45 at the end of 2013 and the share price was $725.

I have suggested that they should sell down the equity portfolio to buy back stock. It would reduce risk while being accretive to NAV and increasing our ownership in Empire Life on a per share basis.

Safety, that is an interesting theory and maybe could have some truth.  I guess there are two possible takeaways from it if that is true:

1 - The family has incentives that are different from the average shareholder and that could cause them to act a certain way that furthers their own interests
2 - The share price could potentially be artificially low right now and after Henry passes they will be free to pursue more shareholder friendly moves

Right now I have a chunk of money to deploy and am trying to decide between going with Canadian General Investments (TSE:CGI) or Economic Investment Trust (TSE:EVT).  I think I will go with Economic as I think there are lots of levers for EVT/ELF to pull to unlock value.  I plan to attend the shareholder meeting and add my voice to yours to try and get management to unlock value.


SafetyinNumbers

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Re: ELF.TO - E-L Financial Corp. Ltd.
« Reply #131 on: September 14, 2019, 09:31:38 AM »


Safety, that is an interesting theory and maybe could have some truth.  I guess there are two possible takeaways from it if that is true:

1 - The family has incentives that are different from the average shareholder and that could cause them to act a certain way that furthers their own interests
2 - The share price could potentially be artificially low right now and after Henry passes they will be free to pursue more shareholder friendly moves

Right now I have a chunk of money to deploy and am trying to decide between going with Canadian General Investments (TSE:CGI) or Economic Investment Trust (TSE:EVT).  I think I will go with Economic as I think there are lots of levers for EVT/ELF to pull to unlock value.  I plan to attend the shareholder meeting and add my voice to yours to try and get management to unlock value.

I like EVT as well. There is a good argument that EVT will be the first place they could release some value. I would do it by offering to buy it for NAV, thus buying back a lot of ELF at the current share price. Very accretive and relatively simple.

I also like TII.V right now if you are looking for a company trading at 0.55x book and is actually trying to close the discount but having no success. They have maxed out the NCIB the last two years, introduced a new dividend (4% yield) that goes ex on Sept 27 and grown the business. ROE is trending towards 10% and should go over which might close the discount or perhaps the buyback will begin to have an impact when its resumed in late November.
Top 5 positions: ELF GCM.NT/GCM.WT.B TII.V PIF AZP.PR.A

SafetyinNumbers

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Re: ELF.TO - E-L Financial Corp. Ltd.
« Reply #132 on: October 13, 2019, 09:41:37 PM »
East 72 with a new discussion of ELF in quarterly report

http://east72.com.au/wp-content/uploads/2019/10/E72-Quarterly-Report-Sept-2019.pdf
Top 5 positions: ELF GCM.NT/GCM.WT.B TII.V PIF AZP.PR.A

Stuart D

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Re: ELF.TO - E-L Financial Corp. Ltd.
« Reply #133 on: October 13, 2019, 11:53:09 PM »
East 72 with a new discussion of ELF in quarterly report

http://east72.com.au/wp-content/uploads/2019/10/E72-Quarterly-Report-Sept-2019.pdf

That's great - @SafetyinNumbers thank you for posting!

mjm

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Re: ELF.TO - E-L Financial Corp. Ltd.
« Reply #134 on: October 14, 2019, 04:24:03 AM »
agreed. good stuff

sundin

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Re: ELF.TO - E-L Financial Corp. Ltd.
« Reply #135 on: October 15, 2019, 01:54:07 PM »
East 72 with a new discussion of ELF in quarterly report

http://east72.com.au/wp-content/uploads/2019/10/E72-Quarterly-Report-Sept-2019.pdf

"....the company and its associates stress the fact they do not retire equity and that discounts to net asset value are to be expected however, acquiring EVT outright would make some degree of sense. "

Why would they not retire equity w/ such a glaring discount to book value? Is the IRR of acquiring EVT outright is greater than buy backs?

SafetyinNumbers

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Re: ELF.TO - E-L Financial Corp. Ltd.
« Reply #136 on: October 15, 2019, 08:42:02 PM »
East 72 with a new discussion of ELF in quarterly report

http://east72.com.au/wp-content/uploads/2019/10/E72-Quarterly-Report-Sept-2019.pdf

"....the company and its associates stress the fact they do not retire equity and that discounts to net asset value are to be expected however, acquiring EVT outright would make some degree of sense. "

Why would they not retire equity w/ such a glaring discount to book value? Is the IRR of acquiring EVT outright is greater than buy backs?

Yeah, because EVT owns ~10% of ELF, if they acquire EVT for NAV, they can buy back a lot of shares back without paying a premium.
Top 5 positions: ELF GCM.NT/GCM.WT.B TII.V PIF AZP.PR.A