You are reading a single comment by @frank9755 and its replies.
Click here to read the full conversation.
-
Sure, but not sure that helps. The fact is that it is trading now (not always) at a premium to NAV. I was setting out reasons to explain why that might be the case.
Those are reasons why it might not trade at a premium, but given that it is, not sure that they shed a lot of light, do they - reasons why something should not do what it plainly is doing?
Actually, turning it round, one reason could be irrational exuberance on behalf of investors in the face of normal valuation logic - maybe that is what you are saying...?
frank9755
andyfallsoff
Most quoted companies trade at a premium to NAV because they have income streams, so a nav valuation would understate it.
Ones which are more asset based (look at REITs) tend to trade at a discount to NAV, and that's even with revenue creating assets.