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Patria Investments: An Interesting International Dividend Stock

May 03, 2022 9:00 AM ETPatria Investments Limited (PAX)BX20 Comments
BeanKounter Capital profile picture
BeanKounter Capital


  • Patria is an asset management firm focused on South America that went public in 2021.
  • It is a high margin, asset light business model with the potential to print massive amounts of money at scale.
  • At 16x earnings, Patria is materially undervalued relative to the growth potential.
  • The yield is currently 5.3% but has significant potential for future dividend increases.

Business network concept. Business meeting. Marketing.

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There has been a lot of talk about interest rates, volatile markets, and a recession in the first four months of 2022. We are also starting to see most of the speculative companies in ARKK

This article was written by

BeanKounter Capital profile picture
You can find me on Substack at Kontrarian Korner: CPA and former Big 4 auditor. I break down investments in qualitative and quantitative terms, and I look for investments that will compound my money over the long term.

Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

I plan to buy shares of Patria in the next couple months.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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Comments (20)

Share price keeps falling : 13.01$ as session close on 07/13.
Is there a reason for that?
@Ian Bezek what are your thoughts on PAX?
Ian Bezek profile picture
@hiztiteness Not too familiar with this one. Owning infrastructure assets in Brazil heading into a Lula presidency at first glance seems pretty risky, but if management has good local connections maybe it's alright.
@Ian Bezek thanks for the quick response. I need to dig more deeply into this one.
Seth Yar profile picture
I really like the prospects for this company primarily because of managements past performance results - each of their funds continue to get bigger and bigger. I also like that insiders (and Blackrock) own a very big percentage of the common stock and insiders are locked in for 5 years from the IPO.

Their AUM and earnings have been growing fast and so have their dividend. Would be interesting to see how this company progresses over the years, but I can imagine it should be much better then now.

In the 1Q22 quarterly earnings report, management has said the off-balance sheet current accrued management incentive fee totals about $500 million which makes future earnings and dividend prospects even better.

Really glad to have gotten into a stock close to the ground floor. (I own the stock of PAX).
PAX was purchased by Blackstone over a decade ago and brought public over a year ago. Blackstone will eventually sell its entire interest I suspect. PAX and another Brazil-based alt money manager VINP came public in the same time frame. I own both because each has different mission statements and south America is largely overlooked when it comes to alt asset investing.

Yes there is corruption and crime but both management teams have been around a long time and are involved in south America at a time when governments need/want to sell off government and other infrastructure investments to outside investing groups.

PAX was largely overlooked as its IPO price eroded very quickly. Blackstone's IPO was at the same time they were selling two other investments to two SPACs (PSFE and ALIT) which have been complete bombs. I got in at a much lower price and have enjoyed its dividend growth AND a midyear payout of share of realized gains that most investors are unaware of. The quarterly dividend is paid from earnings from AUM management. This year's midyear realized gain should be significantly smaller than last year.
@Brucejfern do you consider $PAX as a buy,,for passive income / dividends collection?
Dividend increase to $0.202/qtr from $0.16/qtr.

I dare say that is a hefty increase and a function of PAX now performing with $25B of AUM now.
Xav Welsh profile picture
@Brucejfern The stock is down today but the results seem good and new dividend level is great. I’m picking up what the market is putting down….
@Xav Welsh Last quater their revenue grew at a 100% what can.be better? Love this stock!
Not familiar with Cayman Island taxes. If I hold this in a IRA will their be a with holding tax on the dividend? Anyone? thanks in advance.

No, there is no withholding tax on shares held outside an IRA too.
Thank you.
But why did you write : "It will be a while before I start a position in Patria" ?
What are the reasons why you didn't open a position yet ?
BeanKounter Capital profile picture
@Centrino I'm cash poor right now after a fairly big tax bill. Getting paid for a side job I'm working in the next couple months, so I will have some more cash to put to work by the end of June.
@BeanKounter Capital thanks for your openness :-)
@BeanKounter Capital I been watching it and at these prices is like 2 buck below what their usual level is!
Pablo profile picture
I'm flat on PAX, but with a dip, will buy more. May just put a GTC @ $16 for 1000.

I am also flat but taking into account prior year earnings dividend and that large realized gain dividend last year ahead and only went flat yesterday (5/10). Unfortunately I have a very full position and cannot add. Also full on the other Brazilian alt mgr (VINP).
Thanks for the article. I bought them after also being introduced to them from the other article you linked, and I was lucky enough to buy them on Mar. 8, but I think that anywhere in this price range is going to have a high chance of paying off nicely for investors.

Being a smaller company and foreign, it is quite volatile on a day to day basis, but that's OK with me as I only turn over like 5% of my portfolio a year so daily noise doesn't bother me. Been long BAM for 5+ years now, and while it might be too much to hope that PAX turns into another one of those, I'd be happy with anything near the performance
@Chalmus0 One thing is for sure they are making their numbers. They also deal with very rich people in a fiscal paradise, so their prospects look very green! I been buying this since last year no complaints here! They just raised their div.
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