Lessons in Liquidity
Pinetree's leaves slowly falling
A short one.
I originally bought Pinetree Capital and wrote it up when it was trading under book value around 4$ CAD per share. I was very fortunate on the timing and it has since grown to a sizeable position in the portfolio. I have even recently added a small amount around 10$ (nothing moving the needle for the allocation). This is in part because it took a steep fall from its highs around 15$ and partly due to the fact that I would like to be a very long term holder, similar to my position in its fatherly figure, Constellation Software. For context, this stock moves like a feather in a hurricane. The dollar-volume of this stock is laughable where a 6 figure day is massive and less common than Mark Leonard paying more than 2x sales for a VMS business.
Its most recent stock price movements have been nothing but nauseating. It was not long ago that the price was at 6,7,8 dollars after being at 3-4 just months prior. Then it continued to shoot up to 15. It appeared to get ahead of itself as the valuation (one version of it anyway) went from something like 0.7x book to closer to 2x. It then came crashing down to earth from 15 to below 10. Its since rebounded towards 12$. The big up then down felt good then bad. If you look at how much this thing trades, its essentially by appointment.
Insiders were selling, notably L6 Holdings which is the Leonard’s family vehicle for