How About Another Catalyst? (Part VII)

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activist investors, Clearance Capital, DCD Media, EIIB, HBG Holdings, Joe Lewis, Laxey, Leo Fund Managers, Max Property, Minco, Net LTV, Nick Leslau, Principle Capital, Quintain Estates, Sirius, stockbrokers selling sandwiches, Taube Hodson Stonex, Terra Catalyst, Timeweave, Weiss

Continued from here:

In my previous post, I highlighted over a dozen listed activist investor vehicles (some at v interesting discounts) you can invest in. Additionally, you might also want to look at individual company situations – as I commented about activists: ‘Use them wisely (and profitably) to cherry pick and/or endorse your conviction stocks.’ Here are some interesting examples:

Timeweave (TMW:LN):   I’ve written here about Timeweave, which has Joe Lewis on board with 29.99%, with another 5% in the hands of Leo Fund Managers. TMW has a steady business, pots of cash, and a whopping 10.4% dividend yield. If you strip out cash, it’s actually on a 4.7 P/E! Despite all this, it can’t seem to get any respect – take a look at the share price. But we all know shares like this, and wonder when we’ll see a decent return…

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Seduction…and Neglect?! How About a Catalyst? (Part II)

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dividend coverage, dividend yield, Event Driven, Expected Value, Interior Services Group, IRR, Joe Lewis, Leo Fund Managers, Magnier & McManus, Margin of Safety, Risk Arbitrage, Timeweave

Continued from here:     OK, so we’ve defined what a stock catalyst is, and also recommended you evaluate catalysts from an IRR perspective.  This is the best way to highlight how they can deliver a dramatically improved return, due to the (potential) acceleration of value realization.

If you really want to complicate your life, you could also layer in an EV approach…the analysis that is, not the blog! Let’s not dig into the math/mechanics here, but it spotlights another attractive feature: A catalyst may prompt you to attach higher probabilities to positive/specific/increased return scenario(s), thereby increasing the Expected Value of your investment return. For example, Risk Arb (and many Event Driven) opportunities offer a specific price ‘target’ and timeline, with a high probability attached to this outcome, so EVs (and, of course, IRRs) can be pretty tasty!