One of the most frustrating things about writing investment research is when you do good work and the stock goes up, but you forgot the bit about buying it.
Thanks Darren. It would be great to see HK get serious about raising shareholder returns like Japan has. You're right that there is a lot of value there.
What do you think Ashmore will look like in 5 years. Now it looks like the net flows are about -2/3% per year & maybe 6/7% market appreciation so you get 4% Aum maybe 3% revenue increase & 5/6% NI increase. Any discussions of buybacks vs. dividends? If they repurchased vs. dividends then you can get mid-teens EPS growth & get some of the cannable investors interested. Any discussion of return of excess capital to shareholders? TIA.
Hi man, the company breaks this number down every six months and judges only a fraction of current reserves to meet their capital requirements. From the latest report:
The Board has determined that the level of capital required to support the Group's activities, including its regulatory requirements, is £96.8 million. As of 31 December 2024, the Group had total capital resources of £646.1 million, equivalent to 91 pence per share, and representing an excess of £549.3 million over the level of required capital.
It's almost impossible to say, but I don't think you can project current trends in a straight line for this biz. I'm hoping we're somewhere close to the cycle bottom and AUM will be considerably higher in 5 years.
Unfortunately buybacks don't seem to be part of the discussion. The company line is that they are committed to a progressive dividend over time, although there will have to be a decision made about this if earnings continue to undershoot the payout level for the near future.
It seems cheap enough, but you never know. This market is very fickle towards international small caps. Just got to stick with a large Margin of Safety.
Thanks Darren. It would be great to see HK get serious about raising shareholder returns like Japan has. You're right that there is a lot of value there.
my crappy vanguard brokerage forbids me to buy any of these listings, but it is a very good thesis even w/out the recent CKH affirmation :
https://www.kopernikglobal.com/wp-content/uploads/2025/02/Kopernik-Perspectives-Conglomerates.pdf
Thanks, that's very interesting!
also interesting is post below...especially if still in CKH.
sad to say, the 'least-worst' option with trump may well be that panama ports go into crony control, and he moves on to some new distraction.
am unclear if both CKH and blackrock both genuinely think they are getting a great deal, and it is a win-win.
https://www.asiasentinel.com/p/trump-xi-decide-li-ka-shing-port-sale
Nice! let's see what happens with CK Hutch
Similar to Ashmore is Vinci partners.
I also did not buy Ashmore because I thought that flows would never reverse :) but it is wrong in hindsight
Well done guy on owning CKH. That was a nice pass.
China centric Asia is trading heavy discount.
What do you think Ashmore will look like in 5 years. Now it looks like the net flows are about -2/3% per year & maybe 6/7% market appreciation so you get 4% Aum maybe 3% revenue increase & 5/6% NI increase. Any discussions of buybacks vs. dividends? If they repurchased vs. dividends then you can get mid-teens EPS growth & get some of the cannable investors interested. Any discussion of return of excess capital to shareholders? TIA.
Moody's just lowered US credit rating. SURELY this moves the needle on ASHM
I'm just not sure anyone's looking at it. In April it got down to net liquidity plus 1x peak earnings. Seems crazy, but probably worth the wait.
"P/E of 3x ex-cash and seed using the longer-term average earnings (21p) I used in my former piece."
what is long term P/E without excluding cash? 7,5 or?
And even better, what are longer term EV multiples?
Yes, it would be 7.5x long-term earnings with the cash.
I don't really think of Ashmore through an EV/EBITDA lens, but it would be around 5x last year's EBITDA which had very depressed margins of 42%.
Which space/stocks do you have in mind?
"Watch this space"?
I just meant to watch the space around the deal. We've already seen the CCP voice it's displeasure.
I usually find it rather tough to distinguish what is ‘excess’ cash with financials. How do you go about this with Ashmore?
Hi man, the company breaks this number down every six months and judges only a fraction of current reserves to meet their capital requirements. From the latest report:
The Board has determined that the level of capital required to support the Group's activities, including its regulatory requirements, is £96.8 million. As of 31 December 2024, the Group had total capital resources of £646.1 million, equivalent to 91 pence per share, and representing an excess of £549.3 million over the level of required capital.
It's almost impossible to say, but I don't think you can project current trends in a straight line for this biz. I'm hoping we're somewhere close to the cycle bottom and AUM will be considerably higher in 5 years.
Unfortunately buybacks don't seem to be part of the discussion. The company line is that they are committed to a progressive dividend over time, although there will have to be a decision made about this if earnings continue to undershoot the payout level for the near future.
It seems cheap enough, but you never know. This market is very fickle towards international small caps. Just got to stick with a large Margin of Safety.