Daniel Webster - Seeking Alpha 'Daniel Webster' Tag RSS Syndication from SeekingAlpha.com SeekingAlpha.com http://seekingalpha.com/author/daniel-webster Following Big Money Pays Off http://seekingalpha.com/article/70000-following-big-money-pays-off?source=feed 70000 The market is in a correction as the economy slides into recession. Jobs are being lost, homes are being lost, and liquidity is disappearing as loans default, budgets tighten, and high prices stifle spending. Strength overseas coupled with a weak dollar, however, should keep corporate profits from sinking too much, and wealthy savvy investors seem to be propping up undervalued companies. Cash-rich companies are also buying the undervalued. There is big money moving in the market, and individual investors should pay attention to it.

Whether the recession will be mild or not, uncertainty reduces the willingness to invest in risk causing the market to fall to lower valuations. The current rally suggests valuations have fallen enough, for the time being.

]]> Wed, 26 Mar 2008 07:11:19 -0400 Daniel Webster The market is in a correction as the economy slides into recession. Jobs are being lost, homes are being lost, and liquidity is disappearing as loans default, budgets tighten, and high prices stifle spending. Strength overseas coupled with a weak dollar, however, should keep corporate profits from sinking too much, and wealthy savvy investors seem to be propping up undervalued companies. Cash-rich companies are also buying the undervalued. There is big money moving in the market, and individual investors should pay attention to it.

Whether the recession will be mild or not, uncertainty reduces the willingness to invest in risk causing the market to fall to lower valuations. The current rally suggests valuations have fallen enough, for the time being.


Complete Story »]]> AAPL ABK AGO ATVI AXP BRK.A DD ERTS GE GOOG IBM INY KO MBI MSFT MUB NIO NYF PZA SCA SNE TFI THQI TTWO Daniel Webster Northstar Realty Finance Corp: Shining Through the Volatility http://seekingalpha.com/article/35264-northstar-realty-finance-corp-shining-through-the-volatility?source=feed 35264 We have seen tightening credit standards throughout the lending industry. Investor appetite for Commercial mortgage back securities [CMBS] and collatoralized debt obligations [CDO] has subsided recently due to fear of a spreading real estate meltdown and widening credit spreads. This has created some volatility in the market for these securities and the stocks of companies originating, managing, and trading them. Take JER Investors Trust (JRT) for example, which rose nearly 50% in the second half of 2006, but has struggled throughout 2007. Their most recently quarterly report sent the shares tumbling 5%. The company cited widening credit spreads and competition as the reasons they did not meet analysts' high expectations.

Another company in the commercial lending business organized as a REIT is Northstar Realty Finance (NRF), and they just reported Adjusted Funds From Operations [AFFO] of $.39 per share for the first quarter 2007. This beats analysts estimates of $.34 per share. They previously reported another increase in their dividend to $.36 per share from $.35. This company has achieved tremendous growth since its IPO two and a half years ago. This report gave the stock a much needed 2.5% boost. The stock has struggled since the February correction, but the revenue continues to grow by triple digits.

Why the difference from JRT? Northstar's management believes their business model allows them to take advantage of widening credit spreads and market volatility. They actively manage their diverse portfolios including their nine CDOs, which allows them to make adjustments as the market changes and manage risk better. Their flexibility and responsiveness, not only to the market but also to customers, gives them an edge over the competition. They are the first among their peers to adjust the prices of their debt obligations in response to interest rate increases.

]]> Fri, 11 May 2007 03:44:48 -0400 Daniel Webster We have seen tightening credit standards throughout the lending industry. Investor appetite for Commercial mortgage back securities [CMBS] and collatoralized debt obligations [CDO] has subsided recently due to fear of a spreading real estate meltdown and widening credit spreads. This has created some volatility in the market for these securities and the stocks of companies originating, managing, and trading them. Take JER Investors Trust (JRT) for example, which rose nearly 50% in the second half of 2006, but has struggled throughout 2007. Their most recently quarterly report sent the shares tumbling 5%. The company cited widening credit spreads and competition as the reasons they did not meet analysts' high expectations.

Another company in the commercial lending business organized as a REIT is Northstar Realty Finance (NRF), and they just reported Adjusted Funds From Operations [AFFO] of $.39 per share for the first quarter 2007. This beats analysts estimates of $.34 per share. They previously reported another increase in their dividend to $.36 per share from $.35. This company has achieved tremendous growth since its IPO two and a half years ago. This report gave the stock a much needed 2.5% boost. The stock has struggled since the February correction, but the revenue continues to grow by triple digits.

Why the difference from JRT? Northstar's management believes their business model allows them to take advantage of widening credit spreads and market volatility. They actively manage their diverse portfolios including their nine CDOs, which allows them to make adjustments as the market changes and manage risk better. Their flexibility and responsiveness, not only to the market but also to customers, gives them an edge over the competition. They are the first among their peers to adjust the prices of their debt obligations in response to interest rate increases.


Complete Story »]]> NRF Daniel Webster