Author Topic: Dumbdee - The Goodmans, The Bad & The Ugly - 30% of NAV bargain?  (Read 176325 times)

bizaro86

  • Hero Member
  • *****
  • Posts: 1220
Re: Dumbdee - The Goodmans, The Bad & The Ugly - 30% of NAV bargain?
« Reply #580 on: May 17, 2019, 03:21:43 PM »
DUNDEE CORPORATION ANNOUNCES COMPLETION OF CONVERSION OF
FIRST PREFERENCE SHARES, SERIES 5 (May 15, 2019)
http://dundee.financial/dc/-/media/DGC/DC/2019-05-15-Series-5-Conv-Final.pdf


So is Friday May 17th (T+2) "D-day" in terms of the avalanche of new shares hitting the Pref E holders' broker accounts and onto the market?

Down 7.5% on a multiple of the usual volume. I'd expect Monday to be down as well as retail holders notice the new shares on the weekend.


Foreign Tuffett

  • Hero Member
  • *****
  • Posts: 1172
Re: Dumbdee - The Goodmans, The Bad & The Ugly - 30% of NAV bargain?
« Reply #581 on: May 17, 2019, 05:13:01 PM »
Anyone willing to help me get up to speed on this? Is there a bull case at the current price? If so, what is it?

doc75

  • Lifetime Member
  • Hero Member
  • *****
  • Posts: 593
Re: Dumbdee - The Goodmans, The Bad & The Ugly - 30% of NAV bargain?
« Reply #582 on: May 17, 2019, 05:34:32 PM »

The negative for me was the guide to up to $40m of sales in the next six months - previously they were discussing $100m+, IIRC.

I noticed that, too.   At some point they were treating Android Industries as a non-core asset, and now it's not, so things like this might explain some of the difference, but certainly not all.  As expected, they're not getting much for their assets.   I have no idea how they came up with a $100m+ figure in the first place.  That always seemed pie-in-the-sky.  To be frank they really don't seem to know much about many of their holdings.  It's pretty clear they have no visibility into TauRx, Red Leaf, or UHIC, for instance, or Union Group before that.  They're just crossing their fingers like the rest of us.




doc75

  • Lifetime Member
  • Hero Member
  • *****
  • Posts: 593
Re: Dumbdee - The Goodmans, The Bad & The Ugly - 30% of NAV bargain?
« Reply #583 on: May 17, 2019, 05:53:29 PM »
DUNDEE CORPORATION ANNOUNCES COMPLETION OF CONVERSION OF
FIRST PREFERENCE SHARES, SERIES 5 (May 15, 2019)
http://dundee.financial/dc/-/media/DGC/DC/2019-05-15-Series-5-Conv-Final.pdf


So is Friday May 17th (T+2) "D-day" in terms of the avalanche of new shares hitting the Pref E holders' broker accounts and onto the market?

Down 7.5% on a multiple of the usual volume. I'd expect Monday to be down as well as retail holders notice the new shares on the weekend.

With all the unwanted shares now on the market, I think this will just keep drifting down unless/until there is some truly catalytic positive news (UHIC success being the most likely in the near-to-mid term).  A sale of BG or any other remaining noncore assets won't do it, IMO.   

gokou3

  • Lifetime Member
  • Hero Member
  • *****
  • Posts: 541
Re: Dumbdee - The Goodmans, The Bad & The Ugly - 30% of NAV bargain?
« Reply #584 on: May 17, 2019, 07:31:53 PM »
Only 184k shares traded today and it's down 7.5%.  Another 41.8M to go (ok, I have dramatized this somewhat as some of these new shareholders will hold onto theire shares, and some pre-selling in the form of short sales prior to the conversion date have also taken place... still).

Management is making it clear that it will sit on the sideline and let the share price collapse before doing any buybacks when it stated in their press release that "The Corporation also announced that it continues to consider and evaluate the possible implementation of a normal course issuer bid and/or a substantial issuer bid in respect of its Subordinate Voting Shares."

Disclosure: None, but may buy into the common if it drops much more.

Rod

  • Full Member
  • ***
  • Posts: 205
Re: Dumbdee - The Goodmans, The Bad & The Ugly - 30% of NAV bargain?
« Reply #585 on: May 17, 2019, 07:52:11 PM »
Only 184k shares traded today and it's down 7.5%.  Another 41.8M to go (ok, I have dramatized this somewhat as some of these new shareholders will hold onto theire shares, and some pre-selling in the form of short sales prior to the conversion date have also taken place... still).

Management is making it clear that it will sit on the sideline and let the share price collapse before doing any buybacks when it stated in their press release that "The Corporation also announced that it continues to consider and evaluate the possible implementation of a normal course issuer bid and/or a substantial issuer bid in respect of its Subordinate Voting Shares."

Disclosure: None, but may buy into the common if it drops much more.

I agree. I don't think they have enough cash right now to safely put much into a stock buyback. Buying back preferreds would make more sense to me anyway. At least with that they get an immediate large reduction in dividends they have to pay out. I think 70 cents would be a good price to buy the common. Just using the public investments, Android, the loan to Eight Capital, and cash, you get about $1.40 in equity (after subtracting 130M for pref debt). I think I'd be comfortable buying at half this equity number, given the upside optionality on the remaining assets.

petec

  • Hero Member
  • *****
  • Posts: 2205
Re: Dumbdee - The Goodmans, The Bad & The Ugly - 30% of NAV bargain?
« Reply #586 on: May 20, 2019, 09:02:04 AM »
Anyone willing to help me get up to speed on this? Is there a bull case at the current price? If so, what is it?

The bull case is that the NAVPS is slowly hardening at a number above the current share price. This is happening because they're selling assets and giving a little more info on why one should trust the BV in some of the others. It's also helped by their largest equity position, Dundee Precious, seeing its share price rise after a well-executed expansion.

There is also optionality on the Chad oil royalty paying out. If Delonex discover oil there you'll make a multiple of your money regardless of what happens to the other assets.

The issue is there are many assets and not much information on each, but it's relatively easy to go through the FS and MD&A and piece together what they own. Once you've done that you can calculate a range for NAVPS.

My NAVPS ranges between $0.43 (listed equities plus half their cash, with prefs at par) and $7.24 (most but not all of assets are worth BV, with prefs at market). I regard the bear case as unrealistically bearish but I could be wrong.

My base case is around $2.

I think the selling pressure from the pref conversion could create a really good opportunity here.

FFH MSFT BRK BAM ATCO LNG IHG TFG CGT DC/A

bizaro86

  • Hero Member
  • *****
  • Posts: 1220
Re: Dumbdee - The Goodmans, The Bad & The Ugly - 30% of NAV bargain?
« Reply #587 on: May 20, 2019, 12:19:33 PM »
I have as big of a short as I am comfortable with right now, but if it gets down to $0.43 I'll definitely use some of those profits to take a long position.

petec

  • Hero Member
  • *****
  • Posts: 2205
Re: Dumbdee - The Goodmans, The Bad & The Ugly - 30% of NAV bargain?
« Reply #588 on: May 23, 2019, 01:32:08 AM »
Anyone watching DPM closely? Any reason for the recent collapse? I haven't seen anything negative and was hoping the stock would start reflecting something closer to fair value.
FFH MSFT BRK BAM ATCO LNG IHG TFG CGT DC/A

Cardboard

  • Lifetime Member
  • Hero Member
  • *****
  • Posts: 3356
Re: Dumbdee - The Goodmans, The Bad & The Ugly - 30% of NAV bargain?
« Reply #589 on: May 23, 2019, 05:27:58 AM »
Price of gold is down, all precious metals stocks are down.

Cardboard