14/02/24 - I've had a question from Brent: "Do you have any more thoughts on this as the share price continues to fade away which seems crazy !"
Well, VSL's NAV has fallen by 5.1% in December and 1.1% in November while the share price has fallen by 18.3% so the fall is disproportionate. Largely, I think because people get "bored" with these sorts of shares. There's no particular reason for the 6% NAV fall either, the wider macro doesn't point to any kind of wider decline - quite the opposite actually.
But this is now one of the highest dividend yields and that yield is good for 2024 and most or all of 2025 which will be about a third of the current price, or we may see capital returns instead - that's the whole point of the current Tax Query - to find the most tax efficient way to return funds to shareholders.... legally
It will be interesting to see VSL's January report, which is out soon. The basic premise of this article remains valid - and WeFox newsflow remains positive... in fact is there a WeFox IPO in the offing? A new CTO and group CFO, at WeFox are they lining up and ticking the boxes that precede that? See: https://media.wefox.com/archive/press_releases/
"The majority of investors surveyed for this report remain bullish on payments, as well as regtech, insurtech and AI - particularly wherever these sub-verticals offer solutions to, in Volution VC’s words, “streamline process[es], mitigate risks, and reduce costs."
I'm a fan of VSL type stocks, and whilst I agree there is money back minimum, with potential for upside here, I think your 50% haircut on the debt element is excessive. Yes there will become an inflection point in wind down, where admin/mgmt costs will rise proportionally, having lost economy of scale, but even so, I'd suggest a 25% haircut to be more likely. Which for the patient, means even more pay back than you suggest.
Thanks for this analysis, but note the Heyday that VSL has invested in is the Amazon brand aggregator and not the conversational AI biz. Don’t know anything about it, but from Googling I can see the industry is struggling with recent layoffs etc. So possibly this equity stake (and even the related loan) will not be worth anything?
What do you think about the constant high charges as per the monthly annoucements? Is this mostly financing costs and will this fall as they start to pay back capital?
14/02/24 - I've had a question from Brent: "Do you have any more thoughts on this as the share price continues to fade away which seems crazy !"
Well, VSL's NAV has fallen by 5.1% in December and 1.1% in November while the share price has fallen by 18.3% so the fall is disproportionate. Largely, I think because people get "bored" with these sorts of shares. There's no particular reason for the 6% NAV fall either, the wider macro doesn't point to any kind of wider decline - quite the opposite actually.
But this is now one of the highest dividend yields and that yield is good for 2024 and most or all of 2025 which will be about a third of the current price, or we may see capital returns instead - that's the whole point of the current Tax Query - to find the most tax efficient way to return funds to shareholders.... legally
It will be interesting to see VSL's January report, which is out soon. The basic premise of this article remains valid - and WeFox newsflow remains positive... in fact is there a WeFox IPO in the offing? A new CTO and group CFO, at WeFox are they lining up and ticking the boxes that precede that? See: https://media.wefox.com/archive/press_releases/
Also refer to https://theoakbloke.substack.com/p/vsl-och-its-a-wee-fox where I discuss WeFox
This is worth a read too:
https://www.innovatefinance.com/capital/fintech-investment-landscape-2023/
"The majority of investors surveyed for this report remain bullish on payments, as well as regtech, insurtech and AI - particularly wherever these sub-verticals offer solutions to, in Volution VC’s words, “streamline process[es], mitigate risks, and reduce costs."
Hope that helps provide some perspective.
Oak
I'm a fan of VSL type stocks, and whilst I agree there is money back minimum, with potential for upside here, I think your 50% haircut on the debt element is excessive. Yes there will become an inflection point in wind down, where admin/mgmt costs will rise proportionally, having lost economy of scale, but even so, I'd suggest a 25% haircut to be more likely. Which for the patient, means even more pay back than you suggest.
Thanks for this analysis, but note the Heyday that VSL has invested in is the Amazon brand aggregator and not the conversational AI biz. Don’t know anything about it, but from Googling I can see the industry is struggling with recent layoffs etc. So possibly this equity stake (and even the related loan) will not be worth anything?
What do you think about the constant high charges as per the monthly annoucements? Is this mostly financing costs and will this fall as they start to pay back capital?