Discount to NAV

lse:blnd

#1

NAV per share of 939p is 52% higher than the 619p closing share price, but the discount from NAV to the share price I make 34%, which is pretty substantial, and why BLND’s surplus cash should be used to continue buying in its shares.


#2

“and why BLND’s surplus cash should be used to continue buying in its shares.”

Don’t think I’d ever agree with that. It’s wrong in principle.

A company makes profits which should go to the shareholders. This is the reason for existence of the company which sadly gets lost on some investors. A private company is exactly the same. You cannot tell the owners that this year they must sell shares if they want to see their share of the profits. You’d be fired on the spot.

Secondly, the company cannot control who buys and who sells (in the open market) nor can they determine the price. There is no price level that it is an opportunity to buy or to sell. No one can know tomorrow’s price and therefore it is not the company’s business to gamble on the stockmarket with my rightful profits. The company is a retailer for example, and not a hedge fund manager. What do the directors know about stockmarket movements when even the experts (fund managers) get it wrong?


#3

just bought here. Am guessing brexit is over, Ireland, and if I am right BLND will go up - London property.


#4

I think the company has taken the view that the market value is substantially lower than NAV and it is buying share that it can then hold in treasury to reissue at a later date or not.

The affect of buying its own shares can also support the share price but also it importantly increases the dividend yield as share held in treasury do not qualify for dividends.

Personally I support this action. What I object to is companies buying back shares when they are already overvalued.


#5

I think you’ll find that the shares purchased during the buyback are to be cancelled!


#6

g16cos is right.

From the recent update “In the six months ended 30 September 2017, the Company repurchased 10,724,362 ordinary shares, of which 10,671,074 were cancelled. The weighted average share price of repurchases was 607 pence. During the period from 1 October 2017 to 15 November 2017, a further 15,114,663 shares were repurchased, of which 12,842,709 were cancelled. The weighted average share price of these repurchases was 599 pence.”

I suppose cancelling them makes the books look better. But in essence they can reissue shares to raise capital in future at a better issuing price.


#7

the long and the short of the eu negotiations, is that uk will end up in EFTA. This is good for London, London property and BLND. Buy…