Dundee Corp.: Steep NAV Discount Despite Asset Rationalization

Jim Roumell of Roumell Asset Management presented his in-depth investment thesis on Dundee Corporation (Canada: DC.A) at Best Ideas 2020.

Thesis summary:

Dundee Corporation offers a large margin of safety to a conservative-case net asset value in a sum-of-the-parts analysis. Dundee is principally a passive investor in a slimmed-down portfolio, with interesting core assets, anchored by ~20% ownership of publicly-traded Dundee Precious Metals (Canada: DPM), the proportional market value of which recently approximated the total enterprise value of Dundee Corporation.

The company has no real capital commitments going forward as a result of monetization and restructuring events executed over the past few years. Moreover, Dundee is in front of more monetization events and likely share buybacks given the company’s commitment to deliver value to shareholders after several years of destroying capital (under previous managements).

Dundee has no funded debt, and leverage is solely via perpetual preferred stock that has no maturity date, allowing the company to control a significant number of assets with the benefit of a permanent capital structure. Dundee enjoys the benefits of leverage without the typical risks, i.e., refinancing.

Read Jim’s in-depth investment thesis on Dundee Corporation.

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About the instructor:

Jim Roumell entered the securities industry in 1986. Before founding the firm in 1998, he was a Registered Principal at Raymond James Financial Services, Inc. Mr. Roumell is a frequent contributor to Manual of Ideas Global and has been featured in such publications as Barron’s, Kiplinger’s, Value Investor Insight, Financial Planning Magazine, and The Washington Post. He is listed and quoted in “The Art of Value Investing: How the World’s Best Investors Beat the Market.” Mr. Roumell was selected to participate in, and won, two consecutive Wall Street Journal stock picking contests in 2001 and 2002. He is a Board Member and Chairman of the Investment Committee of Wayne State University Foundation. He is also a Board Member and serves on the Investment Committee of Amalgamated Casualty Insurance Company. Mr. Roumell is a graduate of Wayne State University in Detroit, Michigan.