Is pacific current group mis-priced?
Looking through their AGM they made reference to a Net asset value of $10.46 as of 17th November.
With shares outstanding of 51,037,552, translates to a market cap of $533,852,793.
4% of GQG is worth ~$208 million or 39% of their NAV at $1.76.
They had investable cash of 26.9m at 30 June 2021, the proceeds from the GQG 1% was 43.5m, obviously dead-money until they put into another FM but adds balance sheet strength and optionality.
I'm not sure if the other investments being private are represented at an updated valuation? Possibly able to unlock more value if listed similar to treatment of GQG investment.
I've watched a interview with Paul Greenwood and he came across quite genuine and switched on.
I'm not sure what numbers to use to value the cash flow from the business, on UNPBT its on a multiple of 11.45x or on Management fee profitability measure its 15.95x.
Obviously if holding GQG as I do, there may present a concentration risk when owning both and I'm acutely aware of this. However if one believes GQG is also undervalued PAC may be at an even greater discount.
I don't yet hold a position in this business, I'm only at a very initial stage of analysis and I'm aware there's a lot of moving parts to the business in terms of the number of different managers which will take time to get my head around. Looking at flows they have been positive in every FUM update i've looked at going back as far as 2018, obviously GQG skews the numbers due to the significant size difference in total FUM compared to other holdings.
What is the market discounting considering this is trading at a 30% discount to NAV? Am I missing something?
Interested to hear others thoughts,
Cheers,
Plague.
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