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tomhagen

74 Posts.

8

27/02/19

17:44

Post #: 37591107
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Originally posted by Madtrader ↑

There is nothing Ponzi scheme about it. Simply a company that buys an asset and extracts value out of it over 5-6 years to pay for the purchase, running costs and profit. In simple terms they buy a debt for, say, 15-18c in the dollar, on average try and collect, say 45-50c, spend, say, 50% of the cash inflow on running the business and pump the surplus cash back into debt purchases. Given the leverage model they use debt as well to accelerate purchases while maintaining limits on gearing. Equity raises will also be done where favourable opportunities identify more capital is required than can be sourced from organic cash flow and debt.

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PNC is running a implicit multiple (liquidations / FV-adjustment of around 4). So a debt purchased at 15c, they’re looking to collect 60c over the lifetime - anything less, would be under-adjusting.

For reference CCP’s Australia/NZ operations is closer to 2.1.

The MD has always maintained that this is due to their “tier 1 only” PDP purchasing.

Hope that helps.

PNC Price at posting: $2.40 Sentiment: None Disclosure: Not Held
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Last 62.0¢		Change -0.010(1.59%)		Mkt cap ! $73.69M

Open	High	Low	Value	Volume
61.0¢	62.0¢	60.0¢	$110.0K	179.5K

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No.	Vol.	Price($)
1	1696	62.0¢

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Price($)	Vol.	No.
62.5¢	1	1

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No.	Vol.	Price($)
1	62500	0.480
1	36200	0.470
1	1816	0.465
1	20000	0.460
1	10000	0.455

Price($)	Vol.	No.
0.490	47333	1
0.500	3000	1
0.505	432	1
0.510	85615	2
0.520	904	1

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