Sure PTM is fine-ish as an investment at these levels re the dividend yield and lazy capital on the balance sheet.
However, I think it's a cop out to just blame their woes on their investment style being out of favour on cyclical matters.
Over a long-period of time, you've had:
Covid market meltdowns (they should have performed better) Tech-wreck (again, they should have performed better) Dramatic interest rate adjustments
Plus a suite of other excuses that Clifford and co will give to explain away the fundamental issues of importance.
Yet none of the above has translated into sustained market-beating performance.
The issues at hand as I see them are:
1. Performance Has been weak across the board for a long-period of time when compared with the index. Both absolute and relative performance has been poor. You can't just keep blaming external factors, they've had the good and the bad, and performance has been ho-hum. There are always ways to make a reasonably conservative quid. Their execution of ideas has been downright dreadful. They get caught up in down drafts and fail to perform when the market kicks on. The Healthcare fund has been a debacle. When could conditions have ever possibly been better for a healthcare fund, yet what do investors in that fund have to show for it? half their respective indexes returns over a 5 year timeframe.
Just run a simple comparison with the likes of PM Capital. Same style, same style exposure as Platinum, just double the performance over the long haul. And I dare say a fraction of the headcount, fraction of the useless Board, I suspect they pay less for the largely redundant distribution/marketing efforts.
2. Fees They are over-priced for what you get. This is just a simple fact. If one puts themselves in the position of advisor or direct investor, it just doesn't really stack up to pay them the fees PTM are charging for the performance that you are getting.
3. Management This is where they are really letting shareholders down the most. Every year their expenses creep higher. I've recently pointed the absurd payments to Liz Norman for presiding over dwindling FUM. When Clifford was quizzed on this he fobs it off by saying, well it could have been worse had she not been in the role. What a ridiculous response, that was never the question nor the relevant issue.
It's beyond comprehension that there is no alignment in incentives between staff and FUM. Rather the investment team get all the upside when the funds perform well (periodically) and yet carry none of the downside when the funds continue to underperform.
The challenge with PTM is that they are likely just a rich bloated old bureaucracy now. Management shows no real appetite or desire for tackling the issues at hand (Fees, Performance and internal Management). Or maybe they just lack the capacity or ability to do so.
PTM Price at posting:
$1.61 Sentiment: None Disclosure: Held
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