Songa Offshore: A Fallen Angel With The Potential To Deliver Enormous Returns [View article]
Did some work this weekend, Songa needs $2BB in new financings/refinancings to get them to 2016 when the 4 new rigs are built. Not sure this table is readable below, but unclear if they can raise that kind of capital for the new rigs given existing debt, and the old rigs are 1976 to 1989 vintage stuff, not really worth much and mgmt clearly overpaid for the Dee, the Trym and the Delta. I guess there is a reason the CEO quit, they are not paying their vendors, and they just sold their one decent rig (eclipse) for a 90mm loss. Happy to debate any of the #s below as I lost interest kinda quickly.
The Selling In PIMCO's High Income Fund Continues [View article]
PDI is a newer fund, launched in may but the PM has a v impressive track record at pimco income. it has been as high as a 10% premium to NAV, and to me is a free option in the future that PDI could get back to a big premium over time.
The Selling In PIMCO's High Income Fund Continues [View article]
I think PDI is the most interesting Pimco CEF right now. It trades at a discount to NAV, its portfolio manager (dan ivascyn) has personally bought $5mm of PDI over the past 3-4 months (that is a lot for a 42 yr old guy I am sure). Ivanscyn also runs Pimco Income fund, one of the best performing funds at the firm, and outperforming Bill Gross over the past 5 years. Read about him here, he's a star manager there:
They own non-agency mortgages at big discounts to par, which are benefiting directly from lower delinquencies and higher home prices. Not sure I would want to pay even a 10% premium for a HY CEF that is invested in a space with the tightest spreads to treasuries seen in a long time.
Atlas Pipeline: Pullback On Recent Acquisition And Offering Creates Opportunity [View article]
Its a 600mm deal withing their core operating area on a 2.5BB company. This one should be quite reasonably easy to fold in I think. Hard to explain the selloff really exc that many many MLPs are getting beat up. Distributions often are a return of capital, ie reduce your basis so lots of investors may have big capital gains, and locking in a 15% cap gains tax rate pre year end, before it jumps to at least 23% in 2013. Not to mention the stock has had a big run over the past 3 years. I tend to watch AMLP as an index and it seems quite heavy, may remain heavy til year end.
Atlas Pipeline: Pullback On Recent Acquisition And Offering Creates Opportunity [View article]
Good webcast thanks. PXD upping guidance spraberry has been a great play for them for awhile, i actually remember years ago a dinner w/ Scott Sheffield at a conference, that was a stock I sold poorly at 50! Anyway, back to this, so the GP fee I actually included above as the Minority interest, the $8mm which I did bake into the table. My quick math on the IDR was off, 15% up to 52c plus 50% over 60c got me 49c, forgot the 25% betw 52 and 60c, which is 8c. So, I am actually at 57c on a 2.75 dividend in IDRs, seems very close to your 56c (which is your 68c less 12c in GP fees). I think we agree now, yes?
Songa Offshore: A Fallen Angel With The Potential To Deliver Enormous Returns [View article]
Thanks for this detailed write up, nicely done. One quick question on the cash flow. In the quarter, an increase in payables was $231mm which obviously was a large % of the 330mm or so in positive CF from ops. Are there some vendor payments that the company is stretching, or failing to timely pay for equipment that will reverse out in Q4? Thx.
Atlas Pipeline: Pullback On Recent Acquisition And Offering Creates Opportunity [View article]
Jim thanks for the comments and you are exactly right on ethane. I did recall seeing the disclosures of the realized hedging gains and hopefully am conservative on the future figures there. You make a good point on the IDRs which I did not bake into that table, so if the div's get to say $2.75 (20% higher than today), my math gets me to a 49c IDR. That would total $3.24 in required DCF, so perhaps $3 still works, but maybe not $3.20 in dividends which was my high end case, that is unless we get some help from NGL pricing by then. ATLS owns all the IDRs of course, and some like that play, although I am a tad more conservative and havent done the work there. Thinking out loud a $2.80 div in 2014 and a 7% yield would get to a 40 target price pre divs.
Aircastle Limited: Significantly Undervalued At 6x Earnings, Sports A 6.0% Dividend Yield [View article]
I think Ryan really nailed it. The only additional thought I would add is that these names used to trade at fairly decent multiples of book, around 1.2-1.3x back in 2006-2008. Dividend policies were aggressive, with mgmts paying out almost all of operating CF and relying on the capital markets to fund plane purchases (and hence replacement capex). Said differently, they were continuing to leverage up to pay the dividend, and obviously eventually that cannot last.
When the world collapsed in 2008/2009, the "borrowing to pay high dividend" model fallacy was exposed. Perhaps the ensuing pain felt by holders from 2007 to 2009/2010 was enough to keep investors away from the space, even today. I recall looking at AYR back in 2008 at $20 and passing on it. Well, now that Fortress is out, a big technical overhang depressing the AYR shares at least is gone, and perhaps buybacks and a more conservative capital structure/dividend policy will eventually entice investor back, but its a slow process.
To me, there really isnt any rational reason why a well capitalized asset backed lender with 10-14% ROEs and LT contracts in place cannot trade closer to tangible book, or perhaps at worst at a discount that is more reasonable (say 10-15%).
Atlas Pipeline: Pullback On Recent Acquisition And Offering Creates Opportunity [View article]
Thanks for the comments, yes ATLS benefits from ARP and APL's IDRs. Lots of acronyms there but if APL works, then ATLS probably too. I have not looked into ARP to be honest, but seeing lots of opportunity as tax loss selling dominates many MLP names.
Ellington Financial: The Best Mortgage 'REIT' At A Healthy Discount To Book Value [View article]
Ellington Financial: The Best Mortgage 'REIT' At A Healthy Discount To Book Value [View article]
Songa Offshore: A Fallen Angel With The Potential To Deliver Enormous Returns [View article]
Q4 2013 2014 2015 2016
EBITDA $44 $180 $353 $417 $525
Int $(21) $(73) $(67) $(44) $(26)
Capex $(260) $(724) $(724) $(724) $(100)
Taxes $- $- $- $- $-
Asset sales (eclipse) $590 $- $- $- $-
CF Pre Financing $353 $(617) $(439) $(351) $399
Maturities
Bank (93) (114) (240) -
Bonds - - (125)
Cat D payments $- $- $(50) $(222) $-
$(322) (93) (164) (587) -
Cash on books $194 $225 $(486) $(1,088) $(2,026)
Cash Inflow (outflow) $31 $(710) $(603) $(938) $399
Cash end of period $225 $(486) $(1,088) $(2,026) $(1,627)
Debt BOP 1,410 1,088 995 831 244
Debt EOP 1,088 995 831 244 244
Required Financing (and/or refinancings) (486) (1,088) (2,026) (1,627)
The Selling In PIMCO's High Income Fund Continues [View article]
Tronox: This 4.4% Dividend Yield Equity Trades At A Bargain 5x Earnings [View article]
The Selling In PIMCO's High Income Fund Continues [View article]
http://bloom.bg/12uCJGD
They own non-agency mortgages at big discounts to par, which are benefiting directly from lower delinquencies and higher home prices. Not sure I would want to pay even a 10% premium for a HY CEF that is invested in a space with the tightest spreads to treasuries seen in a long time.
Atlas Pipeline: Pullback On Recent Acquisition And Offering Creates Opportunity [View article]
Atlas Pipeline: Pullback On Recent Acquisition And Offering Creates Opportunity [View article]
Songa Offshore: A Fallen Angel With The Potential To Deliver Enormous Returns [View article]
Atlas Pipeline: Pullback On Recent Acquisition And Offering Creates Opportunity [View article]
Atlas Pipeline: Pullback On Recent Acquisition And Offering Creates Opportunity [View article]
Aircastle Limited: Significantly Undervalued At 6x Earnings, Sports A 6.0% Dividend Yield [View article]
When the world collapsed in 2008/2009, the "borrowing to pay high dividend" model fallacy was exposed. Perhaps the ensuing pain felt by holders from 2007 to 2009/2010 was enough to keep investors away from the space, even today. I recall looking at AYR back in 2008 at $20 and passing on it. Well, now that Fortress is out, a big technical overhang depressing the AYR shares at least is gone, and perhaps buybacks and a more conservative capital structure/dividend policy will eventually entice investor back, but its a slow process.
To me, there really isnt any rational reason why a well capitalized asset backed lender with 10-14% ROEs and LT contracts in place cannot trade closer to tangible book, or perhaps at worst at a discount that is more reasonable (say 10-15%).
Atlas Pipeline: Pullback On Recent Acquisition And Offering Creates Opportunity [View article]
Atlas Pipeline: Pullback On Recent Acquisition And Offering Creates Opportunity [View article]
North Atlantic Drilling: Cheapest Offshore Driller With A Huge 9% Yield [View article]