I don't know who you are, but your knowledge in this conversion arena is severely lacking. FSEA did not have an IPO "pop" of 14% yesterday. More like 3.5% or 35 cents on a ten dollar share. The old shares were seriously underwater in the $9 range, and each old share is exchanged for 0.83 new shares. So your old shares are worth 0.83 times 10.35 or less than $9... pretty bad for shares they charged $10 for in 2019. Your blog has seriously misinformation in it!
You are correct and I updated the number so thank you for pointing out my error. I can promise I will make more of them, it's part of the territory of writing publicly. I do understand exchange ratios, I was simply going too quickly and took the 1 day return from Google at face value without crossing with the obvious $0.35 change on a $10 offer price. Calling a quick error misinformation is a real stretch though so if a simple blunder is too much for you to handle, the 'unsubscribe' button is available anytime sir.
Just make sure you balance the potential gains of a conversion with the risks. Look at this FSEA conversion...those who bought $10 shares in the 2019 first step have remained underwater for most of the time since, and the second step was so poorly subscribed, the original shares are still below their original IPO. price. And those brave enough to subscribe in the second step have a tiny gain thus far. There are plenty of other recent conversions with dismal performance...CFSB and PDLB to name a couple.
Agree 100%, which is why I do my best to discern between those that are interesting and those that are less so. Obviously, it’s always subjective and price has a large impact on any decision. This Substack has never claimed thrift conversions are a panacea to all of investor’s ills. Specifically to your example, I expressed very little interest in PDLB in my review last year.
More of a general question, do you know how many conversions occurred in 2022, 2021, 2020? Or if you don't have that information, is there a source for such information? Thanks much!
I don't know who you are, but your knowledge in this conversion arena is severely lacking. FSEA did not have an IPO "pop" of 14% yesterday. More like 3.5% or 35 cents on a ten dollar share. The old shares were seriously underwater in the $9 range, and each old share is exchanged for 0.83 new shares. So your old shares are worth 0.83 times 10.35 or less than $9... pretty bad for shares they charged $10 for in 2019. Your blog has seriously misinformation in it!
You are correct and I updated the number so thank you for pointing out my error. I can promise I will make more of them, it's part of the territory of writing publicly. I do understand exchange ratios, I was simply going too quickly and took the 1 day return from Google at face value without crossing with the obvious $0.35 change on a $10 offer price. Calling a quick error misinformation is a real stretch though so if a simple blunder is too much for you to handle, the 'unsubscribe' button is available anytime sir.
Just make sure you balance the potential gains of a conversion with the risks. Look at this FSEA conversion...those who bought $10 shares in the 2019 first step have remained underwater for most of the time since, and the second step was so poorly subscribed, the original shares are still below their original IPO. price. And those brave enough to subscribe in the second step have a tiny gain thus far. There are plenty of other recent conversions with dismal performance...CFSB and PDLB to name a couple.
Agree 100%, which is why I do my best to discern between those that are interesting and those that are less so. Obviously, it’s always subjective and price has a large impact on any decision. This Substack has never claimed thrift conversions are a panacea to all of investor’s ills. Specifically to your example, I expressed very little interest in PDLB in my review last year.
More of a general question, do you know how many conversions occurred in 2022, 2021, 2020? Or if you don't have that information, is there a source for such information? Thanks much!
Hi Dave,
Check out this link, they have a nice graph showing that going a number of years back. https://www.spglobal.com/marketintelligence/en/news-insights/latest-news-headlines/mutual-bank-conversions-slump-to-low-point-in-2022-73796034