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gsterling

gsterling
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  • Strong Catalysts And Sum Of The Parts Shows Potential For BBX Capital [View article]
    Daniel,

    I think
    Those charts seem a bit off but I'm going to do a little research. I live in South Florida and actually bought my house in March 2007. I know when I bought prices had already come down quite a bit from their peak and my house is now within 10% of my purchase price on Zillow and I've seen other houses being snapped up around here quickly. In fact when I look at my address on Zillow and it shows the chart for my zip code there it looks way different and shows prices coming down way before 2007. Also your chart look like it ends in the beginning of 2013. Prices have increased quite rapidly since then.

    Try this site: http://econ.st/1fN5Nxf. Makes more sense to me.

    Regarding #1 - BFCF was trading quite a bit lower so BBX would have been acquired at a much lower price. If I owned BBX back then I'd probably be pretty upset too. I'm not sure how those shareholders feel now.
    Jul 21 12:45 PM | Likes Like |Link to Comment
  • Strong Catalysts And Sum Of The Parts Shows Potential For BBX Capital [View article]
    Daniel - Just FYI South Florida real estate prices have actually recovered to about 2007 prices (but not to the very peak of the bubble which was in 2005).

    "4 - Real state is hard to value. Even if the reported value of the real state assets is written-down by hundred of millions of dollars, that doesn't mean it is undervalued regarding its current fair value. Real state was way overvalued at 2007 prices, maybe written-down prices are closer to reality than 2007 prices."
    Jul 21 11:36 AM | Likes Like |Link to Comment
  • BBX Capital Potential Part 2: Overview Of Legacy Assets And Their Potential [View article]
    They are not dumping rapidly. Levan sold about a million shares but still owns 14 million shares. Abdo still owns over 5 million shares. As I've said before they are entitled to take some profits. They are also both about 70 years old.

    BFC did not sell any BBX.
    Jul 20 01:47 PM | 1 Like Like |Link to Comment
  • Micronet Enertec Represents A Potentially Explosive Growth Narrative With Asymmetric Risk Skewed To The Upside [View article]
    Filing out today on the vehicle business they bought from Beijer. The auditors try to carve out the vehicle business even though it never operated as a separate entity.

    The business had gross profit of $1.842M on revenue of $10.732M, but loss from ops was $1.016M after accounting for R&D ($1.437M) , selling and marketing ($745K), and G&A ($676K). I'm assuming they should be able to reduce these expenses by quite a bit after merging with the Micronet business.
    Jul 18 11:32 AM | 1 Like Like |Link to Comment
  • Micronet Enertec Represents A Potentially Explosive Growth Narrative With Asymmetric Risk Skewed To The Upside [View article]
    http://bit.ly/1qhQVCG

    Another follow on order for the A&D side with more to come. Eventually people will figure out that the stock price is not valuing these businesses correctly.
    Jul 17 08:57 AM | Likes Like |Link to Comment
  • Strong Catalysts And Sum Of The Parts Shows Potential For BBX Capital [View article]
    You'll get there :-). BTW in regards to the SEC lawsuit all the research I've done indicates that the monetary penalty BBX can incur is quite minimal (I can send you some info on that if you'd like). It is possible CEO Levan can get barred from running the companies, but in my opinion that wouldn't be a major loss.

    BBX currently trading about 10% under the merger price based on BFCF current price not to mention it is also trading below book value.
    Jul 15 02:43 PM | Likes Like |Link to Comment
  • Strong Catalysts And Sum Of The Parts Shows Potential For BBX Capital [View article]
    Abdullah - I'm not sure where you are getting the $888MM EV. Bluegreen did not have net debt in April 2013. VOI customers finance their purchase through Bluegreen and then Bluegreen securitizes their mortgages and sells them to other financial entities (most are non-recourse). If you look at BXG's last 10K you'll see their Receivable-backed notes payable are more than offset by their notes receivable.

    http://bit.ly/1kUYS8O
    Jul 14 08:54 AM | Likes Like |Link to Comment
  • Strong Catalysts And Sum Of The Parts Shows Potential For BBX Capital [View article]
    Fair questions. I think there are four main reasons they did in fact get such a good deal:

    1) All these companies are controlled by Levan and company. That certainly makes voting a foregone conclusion (although minority voters do have certain rights).
    2) These are fairly small and underfollowed companies.
    3) You have to look at the transformation of Bluegreen. Originally Bluegreen (as well as many other timeshare companies) bought and developed the properties. This was a very capital intensive business and during the financial crisis they got hammered. Their new business model pretty much leaves the development to third parties and instead they make their money from property management fees, sales commissions, securitized mortgages, and title fees.
    4) Timing. By 2009 Bluegreen went as low as 80 cents. They started to really turn things around in 2012. The stock rebounded nicely, but I'm not sure people fully appreciated how well Bluegreen's new business model was doing and how it was a lot less risky. So when they offered $10/share to buy Bluegreen it was only trading around $6. A nice premium which I think most investors were happy with although they did have some lawsuits claiming the price was too low. The reason BBX bought the rest of BXG instead of BFCF was because BFCF couldn't meet the uplisting to a major exchange requirement due to the lawsuit.

    When you look at their earnings from 2012 on I think it's pretty clear they got this at a rock bottom bargain price whether you value it based on earnings, EBIDTA, FCF, whatever.

    I think their RE portfolio is also was undervalued. They did file an investor presentation listing some of their major holdings. I agree it's hard to give a definitive value, but I am quite certain it's worth a lot more than the book value they have listed. The other businesses have minimal value.

    BTW - I believe you are correct with the double counting.

    Regards.
    Jul 13 01:21 PM | 1 Like Like |Link to Comment
  • Strong Catalysts And Sum Of The Parts Shows Potential For BBX Capital [View article]
    I kind of built up a position I realized was above what I was really comfortable with which is why I sold some. But if BBX gets any lower I might get back to an 'uncomfortable position' :-).

    With small cap thinly traded stocks it seems when no news people seem to lose interest quick and any price movement down can turn into a short turn panic. Maybe they forgot why they invested in the first place.
    Jul 11 12:11 PM | Likes Like |Link to Comment
  • UCP, LLC's Lot Portfolio Is Worth 84% Of Its Enterprise Value, Giving Shareholders Homebuilding Exposure At A Discount [View article]
    Stock took a dive the last couple of days. It's a thinly traded stock so I think it was a result of a little panic selling. I picked up a few more shares yesterday.
    Jul 11 10:50 AM | Likes Like |Link to Comment
  • Strong Catalysts And Sum Of The Parts Shows Potential For BBX Capital [View article]
    No love the last few days. It's kind of amazing how much BBX moves around while BFCF has been in the same place for weeks. I had sold some of my trading position when the BFCF/BBX gap narrowed so now I guess I get the chance to buy it back.
    Jul 11 10:43 AM | Likes Like |Link to Comment
  • UCP, LLC's Lot Portfolio Is Worth 84% Of Its Enterprise Value, Giving Shareholders Homebuilding Exposure At A Discount [View article]
    I don't remember calling you elitist or pompous or anything of the sort however right now I'm thinking of some other words for your accusations.
    Jul 9 07:35 AM | 1 Like Like |Link to Comment
  • UCP, LLC's Lot Portfolio Is Worth 84% Of Its Enterprise Value, Giving Shareholders Homebuilding Exposure At A Discount [View article]
    It depends when in 2008 they bought. If they bought towards the last Q they did okay (close to even could be a little above or below where his chart ends depending on the location). 2008 accounts for only about 15% of their land purchases (see chart in the article).
    Jul 7 12:24 PM | Likes Like |Link to Comment
  • UCP, LLC's Lot Portfolio Is Worth 84% Of Its Enterprise Value, Giving Shareholders Homebuilding Exposure At A Discount [View article]
    Mike - I'm sure John will respond with his own opinion, but I wanted to comment on some of your points:

    1) Not sure why you object to PICO owning 57%. It's not like they are some majority owner taking large salaries. They only benefit the same way every other shareholder benefits - by the stock going up.

    2) Nothing wrong with having a lot option if it enabled you to lock in at a low price.

    3&4&5) That's true, they did start as land speculators (not that there is anything wrong with that). They only started as a homebuilder in 2010. They still sell lots to other homebuilders, however they are now concentrating on homebuilding. As John already mentioned they will be doubling their community count this year. Yes they only sold 196 homes in 2013. That's exactly the reason gross margins and profitability are so lumpy. As they sell more homes the margins should get better and start to level out. Management already stated the land cost % is in the low 20's so I think that shows their potential. As I mention in my post below they already did most of their hiring in anticipation of the new communities and that is the main reason G&A. Management stated they will return to profitability this year.

    6) I'm not sure why you believe just because a house isn't in a pricey neighborhood that doesn't make it desirable. All you need to do is look at the charts in John's article to see how home prices have been doing in those areas. That's the important part. Lower and middle class buyers need homes too. Housing inventory in California is generally in tight supply and their communities have been selling quite well (we know how many homes they sell from their filings and they happily discuss the different communities on the calls).
    Jul 6 10:28 AM | 1 Like Like |Link to Comment
  • UCP, LLC's Lot Portfolio Is Worth 84% Of Its Enterprise Value, Giving Shareholders Homebuilding Exposure At A Discount [View article]
    I believe most of this was covered on the last conference call but SA doesn't have the transcript for the last one. I believe they in fact indicated that a lot of the building in fact hasn't been on the lower cost lots. Keep in mind the company is very small and is first starting to ramp up. They are going to be doubling their community count in 2014. UCP has been ramping up G&A in anticipation of the new communities. If I recall they said they've done most of the hiring already so G&A shouldn't increase much once the new communities open. I think I remember them saying incentives are pretty much in line with other homebuilders in their area. I had spot checked a couple of the areas where their communities are and it seem like home prices have been rising nicely in most of them.
    Jul 4 10:47 PM | 1 Like Like |Link to Comment
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