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dhdhoora

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  • An Intelligent Way To Think About Healthcare Trust Of America's Reverse Stock Split [View article]
    L1329-B -- agree that a bit of head scratching on the R/S but noting to be too alarmed about. The typical use of an R/S is to keep a company in compliance with listing rules on the exchange they are listed on or to raise the value of shares above some minimum level (usually $5) to make the stock acceptable for institutional investors. These situations obviously does not apply to HTA -- so one can only speculate that they wanted to keep the number of shares under control as they go forward in issuing new equity for growth capital. No boogie man here...

    Sometimes R/S do work for downtrodden names -- Flagstar Bank ($FBC) had a successful R/S a couple of years ago that worked out well for me. But, my oh my, many of the holders had hissy fits and failed to understand what was going on and ended up throwing the baby out with the bath water...

    ATVB,
    Don
    Dec 20, 2014. 11:15 AM | Likes Like |Link to Comment
  • American Apparel: Leveraged Buyout Is Imminent [View article]
    Dov "controls" 44% rather than "owns" 44% -- right?
    Dec 18, 2014. 11:55 AM | 1 Like Like |Link to Comment
  • An Intelligent Way To Think About Healthcare Trust Of America's Reverse Stock Split [View article]
    Reaster...

    It would appear that you are not up to speed on the REIT industry. These companies grow (hopefully increasing payouts) by adding a balance between debt and issuance of new equity. This is their lifeblood if they want to grow. Issuing new equity is not a negative when done to provide capital for a well-thought-out acquisition, it is good for shareholders.

    The R/S was simply to not let the number of shares get out of hand. Nothing magic about that or negative either. Just ordinary course action in this industry that is continually issuing new shares for growth capital.

    ATVB,
    Don
    Dec 18, 2014. 10:41 AM | 5 Likes Like |Link to Comment
  • Bakken Crude Trading At $41.75/Bbl Is Continental Resources' Quandary [View article]
    Michael, Darren...
    Good comments. But even if the counter parties hedged their strike price with options -- someone, somewhere is not going to find a seat when the music stops. Maybe the GSes of the world don't get tagged, but someone does and the contagion spreads. And, we're talking real big bucks here -- billions upon billions...

    ATVB,
    Don
    Dec 17, 2014. 10:07 AM | Likes Like |Link to Comment
  • What Is Saudi Arabia Thinking? [View article]
    Michael -- great piece. One thing no one is talking about however, is 'financial contagion'. Yes, some of the highly levered E&Ps might eventually face default on their loans -- setting up fire sales or bankruptcy. But what about the counter parties that hold the notes on the production with strike prices at say $85 in 2015? No one now sees oil returning to that level in the intermediate future. Isn't this the kind of leverage whizmo jamo that set off the last financial meltdown? How are the counter parties going to be able to handle getting crushed?

    I'm way too long on Bakken and Eagle Ford players -- some I will hold and others will go bye bye tax losses with their 80% sell-offs. But, I'm equally worried about financial contagion when all we hear about is that lower pump prices are good for the economy. Hey, 130% loan to value mortgages were good for the housing market until the music stopped. Well, seems to me the music has stopped in the leveraged E&P space. Hope I'm wrong.

    ATVB
    Don
    Dec 16, 2014. 12:57 PM | 4 Likes Like |Link to Comment
  • Bakken Crude Trading At $41.75/Bbl Is Continental Resources' Quandary [View article]
    Thanks Michael... too many 'investors' here that need a primer on commodity pricing and hedging. That said, I'm really wondering about counter party risk -- contagion that spreads to the contract holder. Dozens of Bakken players have hedged 25% to 50% of their production -- probably at prices in the high $80/bbl range. Should the producers execute their contracts -- the counter parties are stuck with buying the oil at possibly $30 over the market. Many then would face catastrophic losses. Problem is that we just don't know who is holding these contracts -- hedge funds, banks, etc. 6 months ago, buying oil @ $85 seemed like a pretty safe and smart play. Hmmm... surprised that the contagion issue has not yet risen to greater awareness. Interesting that a small piece in Barron's identified a bunker oil player that declared bankruptcy after a couple of their traders made absolutely the wrong bet on bunker oil. Of course, we heard very little about the 2008 financial crisis until it was too late...

    ATVB,
    Don
    Dec 15, 2014. 04:25 PM | 2 Likes Like |Link to Comment
  • Lonestar Resources Is Hilariously Undervalued Right Now [View article]
    Where did this come from today?

    Well, IMHO we have a very low priced, thinly traded pink sheet stock. It would simply take one buyer with say $500k to invest to push the price up dramatically. That's probably what happened yesterday -- uh, maybe they read and understood the operational report -- or even possibly the two active posts on S/A. No long term holders would be selling down here so the buyer chased the traders up the ladder. Keep in mind that yesterday's action only generated less than $2m in actual $$ value traded... No exactly a huge breakout. Let's get on with a R/S and get this off of the penny stock nonsense...

    ATVB,
    Don
    Dec 13, 2014. 11:01 AM | 2 Likes Like |Link to Comment
  • Lonestar Resources Is Hilariously Undervalued Right Now [View article]
    Although I'm not a big fan of the YH MBs - silly that Lonestar does not have one. I posted a request on their care section under finance and message boards...
    ATVB,
    Don
    Dec 13, 2014. 10:53 AM | 2 Likes Like |Link to Comment
  • Triangle Petroleum: What Are The Assets Worth? [View article]
    Thanks Richard! I'm not up to your pay grade in E&P analysis, but we all seem be zeroing in a $65/bbl price for any long term going concern for most Bakken players. I have one -- American Eagle ($AMZG) that is my worst performer in several years. I clearly don't think they are going to make it, but others, like TPLM will probably hang through 2016. I hold a bunch of $SN and $LNREF in the Permian -- would love to see your good work on $SN -- and it looks like they are getting better than expected results on the big Catrina play that they made just before the debacle hit. Of the bunch, I find Lonestar ($LNREF) to be in just about the best shape of the lot -- but hey, nobody has heard of them on the pinks...

    Thanks again for all of your good work!
    ATVB,
    Don
    Dec 11, 2014. 08:47 PM | 1 Like Like |Link to Comment
  • Lonestar Resources Is Hilariously Undervalued Right Now [View article]
    So did I. Love these falling knives! But Operations Report too good to ignore and worry about the absolute bottom. I'm in for at least two years -- my average SP is .29 and will continue to accumulate down here.

    ATVB,
    Don
    Dec 10, 2014. 11:05 AM | 2 Likes Like |Link to Comment
  • Lonestar Resources Is A Great Value Long Term For Your Portfolio [View article]
    Very encouraging report. I keep adding $LNREF to the collection of falling knives that are stuck between my toes... Hmmm..

    Anyway, with the market so emotionally charged against oil and trading eveything in tandem, we cannot expect price recovery until this thing washes over and a bottom is declared in oil price. That said, in a 18 month to 36 month horizion, hard to see anything but a 5x bagger. Just wish we had even a tiny bit of liquidity in the US market. Still would be in favor of a significant R/S to get $LNREF out of the backwater. Looks too good to be stuck in penny land...

    ATVB,
    Don
    Dec 10, 2014. 10:39 AM | 2 Likes Like |Link to Comment
  • Two Reasons Why Lawsuit Against Seadrill Is Not Justified [View article]
    Fiduciary responsibility would have developed a contingent plan and would have taken a measured reduction in the dividend earlier -- as had telegraphed by industry wags well before the suspension. IMHO, They set up the scam to get bond holders to convert. Then the music stopped... Then they went into 'panic mode' to save the company as you pointed out. Don't disagree with that. It is their actions, playing fire with Russia etc. well before the suspension that exacerbated this debacle...

    ATVB,
    Don
    Dec 9, 2014. 11:24 AM | 2 Likes Like |Link to Comment
  • Two Reasons Why Lawsuit Against Seadrill Is Not Justified [View article]
    Nice try. IMHO, the action by Fredrickson to purchase shares and the company's statement to sustain dividends was probably part of the program set in place to get bond holders to convert their $650M in bonds to equity in late July, 2014. It is a statement of fact that they indicated the dividend would be sustained through 2015. They will try to hide under their 'forward looking statements' clause and may very well duck any responsibility. But, the company played financial musical chairs with drop downs, pop-ups, head-in-the sand, every things gonna be fine until the music stopped... Reasonable planning would have had some kind of contingent Plan B to deal with a crash in oil prices. The company knew only one strategy -- lever up and petal to the metal. IMHO, their recklessness was taken out on the backs of long term income investors. Yes, $SDRL may be a great buy today, but why would anyone ever trust their management?

    ATVB.
    Don
    Dec 9, 2014. 10:39 AM | 8 Likes Like |Link to Comment
  • Northern Tier Energy: A Small, Cheap Refiner With A Put [View article]
    Thanks Detroit Bear! I appreciate your no nonsense approach to stating your position and thesis behind $NTI. I am a big Northern Tier fan and yes, its SP has been butchered along with anything in the oil patch. That said, I have been impressed with the executives at Northern Tier and the operational people at the refinery. Together, they seem to have a financial sophistication not typically seen in a smaller play. The way they handled the scheduled downtime and outage last year gave me confidence in they knew what they were doing. The switch of the GP to Western was a very smart and timely move. Some additional items that need to be added to your thesis:
    1) The location of the refinery to both Bakken oil and Canadian Sands oil gives them an advantage over many other refineries.
    2) They have invested in logistical resources -- both truck and pipeline to help support their location.
    3) As you pointed out, as a variable dividend MLP, the dividend reflects more short term operational characteristics of the business than traditional dividends. The $1.48 11/19/12 dividend is an outlyer reflecting catch up dividend as the company was going through IPO. The low dividends reflect scheduled turnaround and an operations challenge -- they are also outlyers. What impressed me was the $1.00 dividend on 11/12/14 (you have a typo) which is probably the high water mark for perfect operations and market conditions. But with modest decline in both I think your $3 tag is pretty solid.

    ATVB,
    Don
    Dec 8, 2014. 01:00 PM | 4 Likes Like |Link to Comment
  • Update: Plug Power Executes $20 Million Deal - The Stock Is An Investment Once Again [View article]
    ReliOn never had a $20M order. This business is about getting to scale and, IMHO, these type of orders have to help. Yes, there could be tough logistics costs, but scale will help reduce product costs. So, while your comments about profit are sound, it would seem to me that Plug is plugging along in the right direction. Short term, the market has washed its hands of anything effected by oil. We're suddenly going to stop all oil E&P Capex and pretty soon start brushing our teeth with the stuff - not. Balance and some kind of sanity will eventually return. Green technologies are not going away. When FC really takes hold, let's hope that Plug has enough scale to be a real player.

    ATVB,
    Don
    Dec 4, 2014. 08:08 PM | 5 Likes Like |Link to Comment
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