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  • Be Wary Of Prospect Capital [View article]
    I disagree. If the fed starts raising rates sooner than later, it will benefit Prospect. A lot of their portfolio is adjustable on libor. Higher rates will mean higher profits as long as the default rates stay low. Add to the fact that they have issued some debt at good rates that does not mature till 2022, higher rates will most likely help them. Declining rates will most likely hurt them especially now since they have levered up with debt.
    Sep 13 07:01 AM | 9 Likes Like |Link to Comment
  • CommonWealth Management Needs To Go [View article]
    I am thinking of organizing a group of investors to at least send a letter to CWH management that they need to improve shareholder value.
    Oct 30 04:48 PM | 2 Likes Like |Link to Comment
  • Avoid Seadrill Partners IPO [View article]
    Thanks for the comment.

    I never said it was not good for SDRL. Please give me what part of my analysis SDLP you disagree with? And are you participating in the IPO?
    Oct 17 11:15 AM | 2 Likes Like |Link to Comment
  • Avoid Seadrill Partners IPO [View article]
    Thanks for the comment.

    1.) None of the four rigs SDLP is getting have a day rate exceeding $550k.
    2.) Since you are a SDLR holder, I do like this IPO for them since it will give them faster growth. Build and then get cash right away by dumping it to SDLP. Tangible book value for this ipo is below $10.
    3.) If you are a long time bull on the industry, then why not just stick with SDRL.
    4.) The unite are not paid for after 4 years. The rates are essentially guaranteed for 4 years since the first contract expires in 2015.
    5.) A 7% dividend with limited upside for years is not great in my book. There are plenty of preferred that will pay above 7+% with limited risks.
    6.) I understand you are an expert in the industry, but there is no guarantee rates are going to go up.

    As a industry expert, how long do you think these 4 rigs will last on average?
    Oct 16 11:01 AM | 2 Likes Like |Link to Comment
  • AIG Warrants Demystified [View article]
    It does not expire. There are other anti-dilution measure besides just dividend. Here is how the dividend one works out.

    SR1 = SR0 x (SP0 – C) / SP0
    where,
    SR0 = the Exercise Price in effect at the close of business on the record date
    SR1 = the Exercise Price in effect immediately after the record date
    SP0 = the Current Market Price as of the record date
    C = the excess of the amount in cash per share of Common Stock the Company distributes to holders over the Dividend Threshold Amount

    The Dividend Threshold Amount shall equal $0.675 per share of Common Stock in the aggregate in any twelve-month period.

    If you want to read the full anti-dilution measure look at their 8k filed with SEC.

    http://1.usa.gov/Qw3Rzz

    Email me at amitd@hypezero.co if you want to take any of this offline.
    Oct 4 12:59 PM | 2 Likes Like |Link to Comment
  • AIG Warrants Demystified [View article]
    Yes, your analysis is correct. I miswrote and wrote annual growth, when i meant a simpler calculation (1.26/8 years).

    The other thing that is hard to take into account is the anti-dilution measure for dividends because we don't know how much dividends AIG is going to pay. But it favors the stock over the warrants since the dividend has to be over .675c a year for the anti-dilution measure to take effect.

    Please contact me at http://www.hypezero.co if you want to discuss further.
    Oct 3 04:08 PM | 2 Likes Like |Link to Comment
  • CommonWealth Management Needs To Go [View article]
    The only way this is going to happen is if a big investor steps in and makes changes. We can all see this stock is undervalued, but dont have the influence to make changes.
    Oct 31 04:47 PM | 1 Like Like |Link to Comment
  • CommonWealth Management Needs To Go [View article]
    No doubt management fees, but
    1. How do you explain the spin-offs? They make no sense from increasing the shareholder value!
    2. Share dilution.

    I am not arguing that management fees are high, just based on managements actions, they are doing things to increase management fees.
    Oct 30 01:17 PM | 1 Like Like |Link to Comment
  • Dean Foods Spin-Off Offers Healthy Profits [View article]
    Pricing above range at $17. Should see a nice pop on Dean shares tomorrow.
    Oct 25 06:07 PM | 1 Like Like |Link to Comment
  • Dean Foods Spin-Off Offers Healthy Profits [View article]
    Just make sure, it is pretty highly valued. At $15, it will be over 30 times 2011 pro forma earnings and around 26-27 2012 earnings.
    Oct 18 01:36 PM | 1 Like Like |Link to Comment
  • Avoid Seadrill Partners IPO [View article]
    I agree. I think this is good for the parent SDRL.
    Oct 16 12:55 PM | 1 Like Like |Link to Comment
  • AIG Warrants Demystified [View article]
    I thought about doing a more detailed article as you are suggesting, but did not want to over complicate it.
    Sep 27 12:42 PM | 1 Like Like |Link to Comment
  • AIG Warrants Demystified [View article]
    I am not a Black-Scholes expert. But a couple of points, the leaps are priced better if you put in interest rate < 1 and get the volatility from the price of the leaps and then price the warrants based on the same volatility. Also, it is hard to do this because the warrants have anti-dilution adjustment which the leaps do not.
    Sep 27 12:35 PM | 1 Like Like |Link to Comment
  • Be Wary Of Prospect Capital [View article]
    The average salary at Goldman Sachs last year was $225,789 a year.
    Sep 13 10:39 AM | 1 Like Like |Link to Comment
  • Be Wary Of Prospect Capital [View article]
    Last year they made $46 million from management fees. From the Prospect Capital Management website, they list their whole team which is less than 60 people (including administration). So, that comes out to something less than $1 million/an employee. That seems a little high to me.
    Sep 13 10:20 AM | 1 Like Like |Link to Comment
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109 Comments
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