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Senvest Capital Inc. (SEC.TO)

Toronto - Toronto Real Time Price. Currency in CAD
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306.250.00 (0.00%)
As of 10:39AM EDT. Market open.

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  • A
    Anonymous
    Hey, new Senvest Investors.

    This was an ugly Q2 newsprint since it drops the book value from 710 to 584 per share. Since this is an illiquid stock, we can expect some volatility in the days going forward (maybe the stock trade below $300).

    Just wanted to highlight the buying opportunity. The master portfolio has reduced the drop to -13% (vs 24% in June).

    Potential Catalyst (2022-23)

    1. Improved Visibility- The management was open to the idea of audio (only) conference calls to get access to a more retail/institutional investor base.

    2. Value factor Rebound

    3. TSEM Value Unlock- After intel finishes up its acquisition of Tower Semiconductor. This will unlock $500 million [for portfolio redeployment or buybacks]

    4. Potential for increased buybacks- the sense I got from a recent annual meeting was that firm looks at their cash position annually. To decide on how aggressive they need to be in buying back stock. The management highlighted no stock options have been issued since 2005 & was overall quite friendly towards retail investors like me.

    Disclaimer, Senvest is 20% of my personal portfolio. It is my largest position.
  • A
    Anonymous
    @Telcotales Sorry, I missed your reply. Thanks for your detailed estimates. I had the similar weights for the portfolio composition (Masterfund 0.38 and Tech fund 0.62). Seem like they are much more weighted towards the technology fund (maybe because it newer fund?).

    Like you mentioned, even with the ultra-conservative estimates, the NAV discount is wide (if book value is $583 CAD). I didn't even include the 60% percent of the management/incentive fees, they will gain in 2020/21. When Oaktree got sold, KKR bought their fund for 20x projected fee stream. Since asset management is very sticky business, they are a very juicy M&A target. Just rough estimates, if they manage $2 billion in outside capital (1.5% management fee) would translate to $30 million dollars YoY. If you stick a 10-15 multiple on that ($300-450 mil) --> in addition to the NAV. There are companies like Brookfield, Onex listed on the TSX, so we do have local investors who can price asset managers. It seems just a liquidity issue (not enough volume for fund managers).
  • A
    Anonymous
    No one ever sells large number of shares, on the other hand no one ever wants to buy a large number of shares. I fully understand not wanting to sell these shares at this surpassed level. I do not get why no one has discovered this fund. Yes the tax situation is a nightmare in a regular account, and I guess not paying dividend makes it unloved for IRAS. My guess is for US shareholders a dividend would give this a great boost in interest.
  • A
    Anonymous
    Anyone know what to make of SVCTF quarterly report after the bell? I can not get a book value? Noticed it made about the same for the quarter as last year 2nd quarter even though the master fund was up less this time. Any help breaking this down would be appreciated or a link to book value?
  • A
    Anonymous
    Monthly Return (FEB 2021) 15.25% and YTD (2021) return is 59.59% !
  • A
    Anonymous
    @anonyomous This is the outside AUM pulled from the 2021 Q1 report
    Liability for redeemable units 2,580,334 (March 2021) 1,477,779 (December 2020)

    This is very sticky business. Once a brand name is created (i.e KKR, ONEX, Brookfield) the funding flywheel is much easier. The easiest position would be for U.S asset manager to buyout Senvest at slight premium to book, just so that they can buy the historically performance of the funds (18% IRR)

    Example include SkyBridge Capital using acquired fund's performance to market their Flagship funds for the next 10 years.
  • A
    Anonymous
    Based on the last filings

    Liability for redeemable units is $2,580 billion. This is the amount of outside capital being charged AUM fees. If the management fee is 1.5%, then the current Management Expense Ratio (MER) would be 0.28%.

    *The assumption is $25 million base cost for salaries. The current AUM would receive around $22.5 (60%) of the 1.5% management fee. I think it is absolute steal to gain access to management on ETF level MER ratios.
  • A
    Anonymous
    FYI The Senvest overall investment portfolio is up 0.81% (13f filings positions) but the stock is down on low trading. Go figure!

    Estimated Book Value of $680 (CAD)
    Trading 0.51 x Book Value
    95% of the book value is publicly traded equities (Level 1 Quotes)
  • A
    Anonymous
    1,200 shares traded in past 9 trading days between the combined indexes. Shares outstanding 2.6 million. I think at this rate it would take much longer to turnover the shareholder base than the galaxy will last.
  • A
    Anonymous
    Master fund NAV will hit record high with the August update. Also up to start September, the discount on Senvest is amazing. The top holdings are very solid companies with very good valuations. This should be in the low 500s on Canada and low 400s on US exchanges.
  • A
    Anonymous
    My conservatively estimated book value for 2021 Q2 is $692.28 (CAD). If the portfolio's weighted average is similar to the last quarter.

    What's everyone else estimates?
  • A
    Anonymous
    These are my conservative estimates of book value (April 2021)
    $594 (CAD)

    *My estimates have been the lowest so far. So the upside is at least a double from today's stock price ($330 CAD)
  • A
    Anonymous
    People have said the long run discount is around 35% on this fund. If the Nav at end of February is 770 and it compounds at 14.61% for the next 7 years the NAV becomes $2,000 . Discount that 35% percent historical average you have $1,300 a share. The close today was 225.30 grows to 1,300 a share the CAGR for the next 7 years is 28.45% so you get double the NAV return compounding for just a return to normal discount and reasonable 14% Nav compounding.
  • A
    Anonymous
    buyback 1 million shares at price up to 400, shrink the shares outstanding to 1.6 million. NAV would go way way over 1,000 a share.
  • A
    Anonymous
    How long have you been in this fund? Do you have any past access to book value at end of each quarter over the years? Is it your belief book value is in USD?
  • A
    Anonymous
    NAV up 8% this month without knowing GME proceeds. Many of the holdings were at good buy levels when they were selling GME. Could be about to post an incredible 6th straight amazing month of returns. This is without overvalued high flyers with the exception of SI. To review month performances of the master fund NAV October 7.8% November 44.1% December 17.3% January 38.4% February 59.6% why this sells at a 70% discount in a bull market is baffling. Remember they also buy back 3% a year which does not sound like much, but at 70% discount it is a 6.2% kicker to NAV over the course of the year.
  • A
    Anonymous
    The book value increase did not come near matching the Master fund performance? I thought they were much more closely tied together?
  • A
    Anonymous
    Anyone know how many shares are on US exchange and how many are on Toronto? Not the daily trade. I mean shares owned available to trade?
  • A
    Anonymous
    Taking down my NAV target for February to +6%. Brk.A went from Iisting at $290 a share to $22,200 In 15 years from March 17,1980 to Mary 17,1995 CAGR 33.53% to match that Senvest would have to go from $228.00 to $17,442 a share. The NAV would have to grow 23.45% a year and wipeout the discount to NAV. Just laying out some scenarios to give this a nibble or full bite with your investment portfolio and to sit back and be patient. They have averaged 21% returns since 1987. They have a growing income stream of portfolio management, they are buying back shares at gigantic discounts to NAV. They had a bad 6 year stretch from 2014 to 2020 only averaging 6% return (that is the overhang that gives us the amazing discount). The performance the past 5 months will excite people as word gets spread. Buy your own shares first then spread the word about this fund.
  • A
    Anonymous
    Pleasant surprise on the Q1 2021 posting. The book value has jumped to $646 (CAD) per share.

    The stock is trading at 51% discount to book value!!!

    The largest holdings are Ebay (EBAY), Tower Semiconductors (TSEM),
    Marriot Vacations (VAC), Capri Holdings (CPRI), Paramount Resources (POU), Silvergate Capital (SI), and
    Seven Generations Energy (VII), which merged with Arc Resources (ARX) in April 2021.