REI is a much more interesting company than BTI. They have acquired distressed debt funds as well buying select native debt issues. They have also bought into Europesan asset management setups. As for the management fees - well - I don't mind paying the Ruperts for their efforts. We are happy to pay "no-name-brand" management teams to do "a job" without any real knowledge of either their competence or the job they are doing. Their is also much more upside in a R16 share in a R35 BILLION company vs a R490 share in a R1 TRILLION company. I have been singing this song since R11 and I am sticking to it...
I do watch and then like REI moves in US and lately in Uk . This makes it more attractive for me. The percentage edge in price movement over 6 and 12 months to BTi maybe makes up for missing out on div.
I like getting BTI's cashflow at a discount, plus the upside of the non BTI assets. This could look like a very interesting and asset rich financial share in a few years. Put in your bottom draw and enjoy the compound growth.
BTI is on its way out -its not if its when- and for goodness sake please don't quote the number of cigarettes sold in the World as justification for owning it. Threshold is right. REI is a really interesting proposition And it will get interestinger and interestinger as time goes by. It has cash cows starting to be developed - eg in its pension business - and it will continue to add to the portfolio. Drawdown..little to worry about? (ps never ask anyone who you don't know a lot about to manage money for you or funds....and that includes retail offerings.)
So - it's factored in then - why complain. BTI is a one trick pony (a very neat trick, I'll grant you.) She is in an industry which relies on the unregulated emerging market. Her price factors in the possibility of unrestricted access to CHINA. That is a very big maybe. REI will feast on the cash flow and use it to diversify out of this game into other fields. I am happy to pay the Ruperts for this. Anyway - all of that "swanning around" is about image and that is the name of their game! Again - since that swanning is discounted into the share price - it is free - I get the Ruperts for nothing. Bargain!
Alas,BTI and its ilk have been my downfall healthwise!....Second hand smoker et al!....Feel they owe me....I would never buy their procduct,one thing our government has done correct ,to discourage smoking!
@partridge, I think we all know your views on BTI, just as well as you know mine. Had I bought REI instead of BTI, the former would have to trade at R23.76 for it to match the return I've had from the later, and that's excluding divs. Add the dividends an