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  • Impac Mortgage, A Hidden Value? [View article]
    Per the last 10k, you are correct that company has negative equity: "Book value per common share was $(2.59) as of December 31, 2012, as compared to $(2.65) as of December 31, 2011 (inclusive of the remaining $51.8 million of liquidation preference on our preferred stock)." The 10k also discusses the class action lawsuit from the preferred stock holders. I'm not a lawyer either, but common sense suggests management screwed over preferred holders and could be held culpable.
    Jul 23 02:34 PM | Likes Like |Link to Comment
  • Buy Red Hot Spectrum Brands At A Discount Through Harbinger [View article]
    Management's sum-of-parts excludes / backs out SPB's debt. While I find management's sum-of-parts presentation suspect and hard to reconcile, the SPB piece is the most straight forward part. The $7.34 per share valuation is based on a $54.52 per share price in the most recent presentation. At same point in time, HRG had $1.28 billion or $6.21 per share of non-SPG debt and non-VIE debt. The stock is not as cheap as you present above. On another note, as long as the share price remains above the convert price, I find it hard to understand why you wouldn't use the diluted share count (and adjust the valuation for the face value of the converts). Again, good luck.
    Jul 17 04:16 PM | Likes Like |Link to Comment
  • Buy Red Hot Spectrum Brands At A Discount Through Harbinger [View article]
    in response to you comment "I thought your sum of the parts argument unfairly punished them for carrying their share of SPB's debt on their balance sheet without giving them credit for the premium to book value that those same assets get at SPB's actual market price," I did adjust the sum-of-the-parts for SPB's debt and the mkt value fo the shares. I think you are somewhat confused.
    Jul 16 03:56 PM | Likes Like |Link to Comment
  • Buy Red Hot Spectrum Brands At A Discount Through Harbinger [View article]
    #1 You note that the secondary offering in Dec was "perplexing" and "puzzling." However, my article that you linked to above (from nov '12) predicted the hedge fund's ownership was a big risk that was being ignored. This risk is likely more ellevated today than late November given the SEC settlement that requires Falcone to “take all actions reasonably necessary” to satisfy redemption requests from investors. HRG appears to be the only liquid investment at the hedge fund, so shares are likely to trade w/ a massive overhang until Falcone cleans up his redemptions (ie sells HRG shares). #2 I think your sum of the parts is off. Also, I suggest you look at enterprise value, not market cap. Good luck
    Jun 20 03:47 PM | 1 Like Like |Link to Comment
  • The Long Case For Security National Financial [View article]
    Everyone is expanding their distribution networks. Mortgage origination has little barriers to entry and is a commodity business that experienced highly attractive returns for a brief period of time, and as a result, experienced a dramatic rise in capacity.
    Flagstar's book value plus DTA = $22. Stock is at $13.
    Apr 24 02:37 PM | Likes Like |Link to Comment
  • The Long Case For Security National Financial [View article]
    Management's selling appears pretty rational to me. For years the company struggled to make much money, and the stock lingered below $3 per share for most of the past 25 years. The Fed's aggressive purchases of agency MBS produced record, and temporary, spreads that enabled mortgage originators to overearn. If, but more likely when, spreads and volumes normalize, the company's earnings power will be dramatically lower. just my opinion, but this has the makings of a value trap. again, good luck.
    Apr 24 01:24 PM | Likes Like |Link to Comment
  • The Long Case For Security National Financial [View article]
    Thanks for the article, although I think you may want to dig into the sustainability of mortgage gain on sale. The improvement in their results were driven all by this line item. Plenty of other gain on sale players have turned out to be value traps. FBC is one example. you can pick that one up for 3x EPS. good luck.
    Apr 24 12:59 PM | Likes Like |Link to Comment
  • Harbinger Group's Sum-of-Parts Does Not Add Up [View article]
    I did take out the face value of the convert from the liabilities: "convertible preferred stock (so roughly 202 million shares out with a subsequent reduction in debt)"
    I didn't look at your full analysis because I didn't get past the first part. .7x book-aoci / 202 mm shares = $2.65 per share, not $5.
    also, HGIF is deploying funds from the life insurance co I believe (and no outside money). So believe you are double counting the value (your $1). It is like AEL giving its investment department a name and trying to prescribe value do it. worth a shot if investors fall for it.
    Jan 24 06:50 PM | Likes Like |Link to Comment
  • Harbinger Group's Sum-of-Parts Does Not Add Up [View article]
    Not quite. I do argue that it is overvalued (so view of value of assets v. enterprise value). It is best to compare the value of their assets to enterprise value, not market cap. this accounts for the debt they used to acquire their assets (and must be paid off). I do not believe this is controversial point.
    Dec 5 04:37 PM | Likes Like |Link to Comment
  • Harbinger Group's Sum-of-Parts Does Not Add Up [View article]
    Illuminati, I estimate an enterprise value of HRB of just under $2.2 billion ignoring SPB's consolidated debt and adjusting for expo. Fully diluted market cap alone is north of $1.7B. good luck.
    Dec 5 09:51 AM | Likes Like |Link to Comment
  • Harbinger Group's Sum-of-Parts Does Not Add Up [View article]
    Oilmannn, "those who feel" that spb is under valued are better off owning SPB than HRG, in my view. I don't have a strong view on SPB other than it is a low multiple, low growth roll-up that will be riskier with $3.2 billion of debt. I may be "crazy" or "on crack," but I have a hard time reconciling your comments of getting Falcone "out of the way" and the thin trading volume. If Falcone is out of HRG then Harbinger Capital is most likely not viable, which means they would likely distribute or sell their 129 million or so shares, which would likely crush the stock. Best of luck.
    Nov 20 04:42 PM | Likes Like |Link to Comment
  • Harbinger Group's Sum-of-Parts Does Not Add Up [View article]
    Analytics, thanks for the comment but I would appreciate more specific commentary on where or why you disagree with the analysis. Good luck regardless.
    Nov 20 10:50 AM | 1 Like Like |Link to Comment
  • Signature Bank: An Obvious Financial Short [View article]
    Ictus, I would check Etrade again. It is an easy borrow at the lowest rate (millions of shares are available). Either etrade made a mistake or their stock loan is terrible.
    Sep 28 06:12 PM | Likes Like |Link to Comment
  • A Violent Correction Could Be Coming for Hampton Roads Bankshares [View article]
    Kraven, thanks for you comment but I respectfully disagree with your "misinformation" comment. We can argue semantics, but HMPR "failed to perform or pay" (aka default dictionary.reference.c...). I found it ironic that a few months after the bank's management complained about the compensation restrictions of TARP they "failed to perform or pay." As I mentioned in my article, I did a screen of US banks w/ greater than $75 mm market cap (so over 325 banks). I think my characterizations were correct. For example, HMPR was the most expensive on a price to tangible basis (PRSP was #2 at 3.7x), fourth worst for NPAs to tangible capital plus reserves and fifth worst for NPAs to assets.
    Jun 28 04:24 PM | Likes Like |Link to Comment
  • A Violent Correction Could Be Coming for Hampton Roads Bankshares [View article]
    This article was submitted the week of June 17th. Apparently it got misfiled in editorial (why it took so long to publish).
    Jun 27 11:14 AM | Likes Like |Link to Comment
COMMENTS STATS
53 Comments
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