Barron's: Forestar trades at a big discount to NAV


The 20% dip in Forestar (FOR +1.7%) shares since mid-October looks like a buying opportunity, Barron's writes, as FOR sells lots and realizes income from its oil and gas properties over the next year.

FOR, which owns 132K acres of real estate in 10 states including in attractive markets in Texas, is on track to sell ~1,900 residential lots this year, more than double last year's 926 lots, and production in its burgeoning oil and gas unit is up 170% Y/Y.

Proceeds from a recent equity offering, which raised $145M, while dilutive, will further develop FOR's real estate and energy properties in 2014, which could lead to a higher NAV over time.

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Comments (1)
  • King Rat
    , contributor
    Comments (1736) | Send Message
     
    From the data I have seen, they are trading 30% below assets but above NAV. What am I seeing wrong here?
    13 Dec 2013, 01:59 AM Reply Like
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