Yes, it has done well over the last year, but that does not mean it will do well in the future. I was just trying to highlight the risks involved with investing in PSEC.
From Prospect Capital Management's site, they list the whole team http://bit.ly/QekcKp. It is a team of less than 60 people. They earned over $46 million from management fees. About $1million/an employee seems a little high, but that is my opinion.
Less than 5% a year over the last 8 years with the risks associated is good enough for some investors.
Not every individual investor is as informed as some of the more sophisticated investors on SeekingAlpha.
Some investors look at the 10.5% dividend yield and want to invest. I was trying to prove two points:
1. Investing in BDCs, like Prospect, is more riskier than investing in any general stock. They should understand how BDCs works. 2. The company has not been returning 10%+ over the last 10 years.
There will be investors, like you, who already know all of these things I mentioned in the article.
I should I have said I am not a fan of any of the BDC companies based on their business model.I mentioned Prospect because that is the one I keep track of and analyze.
To answer your 1 point. I did not say I would not buy Prospect at any price. If the price did go down to $8+ (below n.a.v.), I would possibly consider buying Prospect if I was the CEO and knew exactly what type of investments my portfolio held just like the CEO did. For everyday investors, it hard to know how safe the securities in their portfolio.
I have a small short position on this stock. Yes, they did improve profitability quite a bit in 2012. However, - They are going up against killer competition. - They have a limited number of stores to franchisee. Most of them are already franchised. http://bit.ly/SeeBah - More expenses as a separate public company.
Sears Outlet is maybe something that they can expand. But last quarter they had negative same store sales at Sears Outlet.
Sears Hometown had positive same store sales. However, a lot of that seemed to promotional activities.
I don't know if you followed Orchard Supply Hardware (OSH). The same argument could've made for that Sears spin-off and now they are near bankruptcy.
I feel like if Sears itself cant turnaround its stores and neither could Orchard. I have my doubts that SHOS can.
Cost cuts only go so far. At some point they will have to show real top line growth.
Genie Energy: Small Cap Value Stock With Upside 'Call Option' Attached [View article]
Good opportunity today to buy common shares and exchange for preferred. Preferred is trading at around $7 and this morning GNE was trading around $6. http://www.hypezero.co
Don't Let Analysts Trick You, Western Union Below $13 Is A Rare Investment Opportunity [View article]
Thanks for the reply, Actually an ounce of coke or liter grows with time. WU's tranaction fee (C-to-C) decreasing 5% per year.Agree with you on earning per share due to buybacks. I wish they would have actually just gave it as a dividend rather than buyback.How did you calculate market share? Because their marke share has been steady around 16-17% and this year it is down based on remittance volume.
Don't Let Analysts Trick You, Western Union Below $13 Is A Rare Investment Opportunity [View article]
1. What do you think of the constant decline in C-2-C revenue per transaction? They have premium pricing, however the industry as a whole is going toward lower pricing per transaction. In order to just maintain revenue, they have to do 5%+ transactions per year?
2.) You mentioned revenue growth, but you forgot to mention anything about net income growth. Because there has not been any! In 2005, net income was $900 million. Kind of similar to 2012! There has no growth even though the remittance volume is up 11% CAGR. Again goes back to lower pricing per transaction.
3.) World bank is projecting remittance volume to be lower than what it has been in the past. This does not bode well for Western Union.
Be Wary Of Prospect Capital [View article]
Be Wary Of Prospect Capital [View article]
Less than 5% a year over the last 8 years with the risks associated is good enough for some investors.
Be Wary Of Prospect Capital [View article]
Some investors look at the 10.5% dividend yield and want to invest. I was trying to prove two points:
1. Investing in BDCs, like Prospect, is more riskier than investing in any general stock. They should understand how BDCs works.
2. The company has not been returning 10%+ over the last 10 years.
There will be investors, like you, who already know all of these things I mentioned in the article.
Be Wary Of Prospect Capital [View article]
To answer your 1 point. I did not say I would not buy Prospect at any price. If the price did go down to $8+ (below n.a.v.), I would possibly consider buying Prospect if I was the CEO and knew exactly what type of investments my portfolio held just like the CEO did. For everyday investors, it hard to know how safe the securities in their portfolio.
CommonWealth Management Needs To Go [View article]
CommonWealth Management Needs To Go [View article]
CommonWealth Management Needs To Go [View article]
Avoid Sears Spin-Off [View article]
I have a small short position on this stock. Yes, they did improve profitability quite a bit in 2012. However,
- They are going up against killer competition.
- They have a limited number of stores to franchisee. Most of them are already franchised. http://bit.ly/SeeBah
- More expenses as a separate public company.
Sears Outlet is maybe something that they can expand. But last quarter they had negative same store sales at Sears Outlet.
Sears Hometown had positive same store sales. However, a lot of that seemed to promotional activities.
I don't know if you followed Orchard Supply Hardware (OSH). The same argument could've made for that Sears spin-off and now they are near bankruptcy.
I feel like if Sears itself cant turnaround its stores and neither could Orchard. I have my doubts that SHOS can.
Cost cuts only go so far. At some point they will have to show real top line growth.
Genie Energy: Small Cap Value Stock With Upside 'Call Option' Attached [View article]
Genie Energy: Small Cap Value Stock With Upside 'Call Option' Attached [View article]
CommonWealth Management Needs To Go [View article]
1.) $1.5 Billion of their portfolio is challenged (60% occupancy rate). Management is trying to sell it. Let's see if they actually do.
2.) $300 million of that portfolio is unoccupied i believe. They might have to sell this at a steep discount 25-30% of book value.
3.) Not buying anymore more properties. Let's see if they actually follow through on this.
CommonWealth Management Needs To Go [View article]
Don't Let Analysts Trick You, Western Union Below $13 Is A Rare Investment Opportunity [View article]
Actually an ounce of coke or liter grows with time. WU's tranaction fee (C-to-C) decreasing 5% per year.Agree with you on earning per share due to buybacks. I wish they would have actually just gave it as a dividend rather than buyback.How did you calculate market share? Because their marke share has been steady around 16-17% and this year it is down based on remittance volume.
Don't Let Analysts Trick You, Western Union Below $13 Is A Rare Investment Opportunity [View article]
2.) You mentioned revenue growth, but you forgot to mention anything about net income growth. Because there has not been any! In 2005, net income was $900 million. Kind of similar to 2012! There has no growth even though the remittance volume is up
11% CAGR. Again goes back to lower pricing per transaction.
3.) World bank is projecting remittance volume to be lower than what it has been in the past. This does not bode well for Western Union.
CommonWealth Management Needs To Go [View article]