Melcor Developments Ltd T.MRD

Nice Q3 - Market Doesn’t Care

[longrun86]

Pretty good Q3 and YTD performance. Community Development looking good, Investment Properties divisin experiencing the headwinds everyone already knows about.

Book value now over $39 and trading at 0.3x book value. Market doesn't care in the slightest with 600 shares traded. 

With insider ownership being so high and no real requirement to access capital markets, the obvious question is why does this even exist as a public company!

It would be nice to receive a special dividend some time next year. I would also be happy to see this be privatized or acquired at a reasonable price. The Board has a responsibility to all shareholders to maximize long term returns. 

We could wake up one day to a very happy announcement. Until then, we just need to be patient.

LR

[babybunny]

Agreed, Q3 performance was solid, particularly considering the softness in commercial property.  Melcor remains a screaming buy.   I am quite happy to continue holding Melcor for the long term.  If they continue peforming as they have in the past, while continuing with opportunistic buybacks, book value could easily surpass $100 a share in 10-15 years.  And all the while,

[longrun86]

It's fun to share thoughts and opinions! SIB: They said at the AGM that the SIB isn't really practical for them due to low volume. I don't know if this is a regulatory approval issue but I think they should try it out.  NCIB: They will continue doing this but the issue will be that due to the lack of volume of shares traded they will find that they can't buy enough.

[babybunny]

Just a few years ago, Melcor was inexplicably not even taking advantage of the NCIB, and a few of us were grumbling about this to management.  It has been great to see them break that habit and repurchase what they can.   I'd like to think they are capable of seeing the wisdom of taking repurchases to the next level through a SIB.  The whole purpose of a SIB is to overcome

[longrun86]

Great to hear that they have taken shareholder feedback regarding capital allocation. I would be all for an SIB. In some cases where liquidity is an issue I think they can obtain a formal valuation prior to undertaking an SIB. Scooping up any shares under $15 is such a no brainer. I am not sure if the 2% share repurchase tax is going to kick in on Jan 1, 2024. It may be a small price to pay.