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koleffstephan

koleffstephan
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  • BDCs And The Russell Indices: Part 3, BDC Fees [View article]
    Mr. McCoy: I too, agree with your statement that "I care about what return on get on my investment and not what the people running the company get." Along those lines, I certainly like Prospect Capital for it's 12 percent monthly dividend payment as well as it's management team - which I am highly impressed with. PSEC is externally managed and while I am almost certain that the external management team makes significant money managing PSEC, I also know that the management team has purchased substantial shares of it's own company (PSEC) on the open market at various price points and not ever sold a share and therefore, has substantial "skin in the game." I think that every investor has to do the research and decide for themselves if the individual BDC stock is giving them or earning them as much value ($) for their money as is commensurate with their investment dollars and if they feel that the managers of the BDC (external or internal) are acting as responsible and diligent stewards of the monies that they are entrusted with.
    Apr 14 04:59 AM | 2 Likes Like |Link to Comment
  • BDCs And The Russell Indices: Part 2 [View article]
    BDC Buzz: PSEC has one of the lowest leverage ratios of all of the BDC's trading on the market. They have not had a loan go into "non-accrural basis" in over 6 years. The CEO owns over 40 million dollars worth of stock and has bought shares on the open market at various stock price ranges from as high as $15/share to as low as $8/share - including having purchased 100,000 shares of PSEC stock, last week, at $10.80/share (approx.), with no shares ever having been sold by him or the management team. The fact that PSEC is "pushing" to invest up to 30% of their allowed limit in unqualified assets does not "increase" the riskiness of the investment of holding PSEC stock. It means that the PSEC management team is not going to keep competing with other BDC companies for the same overcrowded regulated investments that will not give PSEC the type of yield that they are looking for and which may require the BDC company to have to "give in" to the demands of the targeted portfolio company versus the BDC setting the terms of the investment. For you to say "PSEC has many black box investments that analysts have no visibility into how they get their returns," infers or implies that unqualified assets are more risky than qualified assets which is simply not accurate or necessarily true. A BDC having the maximum amount of unqualified assets could imply that the BDC management team has located and identified investments (unqualified) that may be higher yielding and just as safe or safer than their qualified equivalent. Therefore, I don't believe it is accurate or necessarily correct to reason that a BDC is more "risky" because they have up to 30% unqualified assets that have no visibility into how they got their returns. If you believe (and I do believe that you "believe") that PSEC has a talented management team - as I too, do believe that - then the fact that they are approaching up to the 30 percent limit in unqualified assets should not sway or change your perspective on the "safeness" or the "riskiness" of the company's financial fundamentals. My thought process is that "they are doing what other BDC companies are not doing," which differentiates them from the BDC crowd and allows them to offer a 12% monthly yield and this "beating to a different BDC drummer/investor," is one of the many reasons - besides the above reasons that I have mentioned - that makes me want to be an investor with them. Otherwise, if I am interested in investing in a BDC "that does what every other BDC is doing," then I am might as well just invest in an ETF index fund that tracks and mimics and holds all of the BDC stocks in the universe that it tracks.
    I do want to say, on balance, that your article is and was informative and that I do read and appreciate all that you write about the BDC space. Also, for complete and full disclosure, I am - obviously - and advocate for PSEC, as I am a long term investor in the company and most probably "have an ax to grind and a cheerleader" for PSEC stock, but I do think that holding unqualified assets does not make a BDC stock any more or any less riskier than a BDC stock that holds nothing but regulated investments in it's portfolio. Thank you again for writing the article.
    Apr 8 10:02 AM | 11 Likes Like |Link to Comment
  • Seeking Alpha And David Einhorn: The Real Story [View article]
    Mr. Kovalchuk:

    I thank you for your "reasoning" as to "how" Mr. Einhorn may have come in contact with the Micron author without having to sue in court. Your conclusion may or may not be accurate and I do appreciate your response. However, Mr. Hoffman - besides touting the alleged fact that SA never divulged the author of the article to Mr. Einhorn - could have included exactly how and where and when the author and Mr. Einhorn communicated with each other and resolved this matter, as it would have given much credibility to Mr. Hoffman's assertion that SA "had nothing to do" with Mr. Einhorn and the author coming to terms and resolving the matter privately. That is just my opinion. In other words, how do we really know that SA had no involvement whatsoever in Mr. Einhorn being able to locate and identify the author of the article?
    Mar 25 11:51 AM | Likes Like |Link to Comment
  • Seeking Alpha And David Einhorn: The Real Story [View article]
    Mr. Eli Hoffman:

    If Greenlight was able to get in touch with the author of the article (as you write and indicated in your article) then why did Greenlight have to file suit against Seeking Alpha to disclose the name of the author in the first place?

    Your response/rebuttal article to Mr. Einhorn's notification that his suit has been dropped does nothing to make "clearer" how Greenlight was able to find out who the author of the article was and moreover, if Seeking Alpha played any part in Mr. Einhorn finding out who it was. Just because Seeking Alpha "says" that they did not disclose the name of the author of the Micron article does not lend much credibility or believability to any reader of your article without, therefore, disclosing how Mr. Einhorn found out his answer - in my opinion.
    Mar 25 06:59 AM | 3 Likes Like |Link to Comment
  • Can Bank Of America Trade At $40 In A Couple Of Years? [View article]
    Achilles Research:

    I too, own Bank of America stock. However, with all due respect, Dick Bove, the analyst you reference, has a rather lousy "predictive forecasting ability" in forecasting bank stock prices. Furthermore, every time you read an article that Dick Bove wrote, you find out he is now working for yet another investment firm, which infers that he has no "stability" in his professional life because the investment community does not give much credence to his professional opinions. I certainly cannot and will not argue with your financial metrics and conclusion (tangible book value, total book value, etc.) about the possibility of Bank of America being able to one day sell for $40/share, however, I am not "banking" on the opinion of Dick Bove as possibility and proof of this stock price assertion.
    Mar 24 07:09 AM | Likes Like |Link to Comment
  • Prospect Capital: Meet NMMB Holdings [View article]
    The bottom line to me is this. The CEO, John Barry, has purchased over 2,300,000 shares of PSEC on the open market (not grants) with his cold, hard cash. He has purchased shares as high as $16.00/share and as low as shares in the mid to high 7's per share. While I am certain that he makes a "nice" living with his salary from PSEC, I am even more certain that he does not want to lose over 30 million dollars of his own money by making risky investments for Prospect Capital. If Warren Buffet is always worried about losing money (and he is the second richest man in the US) you can be assured that a man who has over 30 million dollars of his own money (and is the not the richest man in the US) is going to be very worried about losing his money by running a Ponzi scheme or running his company in less than stellar, above-board, honest management. The CEO, CFO, and COO interests are extremely aligned with shareholders interests as they all have significant share holdings that they have purchased with their own money (not grants) and as such, I can sleep better (never "well" as the stock market is very volatile and can remain irrational longer than I can remain solvent - to quote a famous economist) in knowing that if I lose money on this holding they are going to lose money too. I have personally met the whole management team and been to annual meeting of PSEC. This one is a keeper and the trust factor is there, as far as I am concerned.
    Mar 11 05:56 AM | 2 Likes Like |Link to Comment
  • Prospect Capital: Meet NMMB Holdings [View article]
    martinm7703: I am referring to the independent 3rd party valuation mentioned by Mr. Eliasek in the Aloisi post.
    Mar 9 09:14 AM | Likes Like |Link to Comment
  • Prospect Capital: Meet NMMB Holdings [View article]
    Phil0913: That was one of my main points in a previous post that I wrote. The "market will dictate what a stock is worth in the long run," and therefore, if the author feels that NICK is undervalued and that PSEC is "stealing" NICK at the offering price, than another suitor should be or will be stepping up to the plate with a higher take out offer. Time will tell.
    Mar 7 06:58 PM | 1 Like Like |Link to Comment
  • Prospect Capital: Meet NMMB Holdings [View article]
    In my opinion, the author is concerned or upset about the fact that his holding (NICK) is not getting purchased for what he believes should be a higher stock price. Secondly, the author is concerned that both the management and the business model of PSEC are/is "risky" because they don't report their losses in the "spirit" of the accounting rules even though it is factually proven that they do report their losses by the "letter" of accounting rules. I am of the opinion, that "the market will dictate - in the long run - what the price of an equity will be. Therefore, having said that, if NICK is/was worth more of a share price than what PSEC is offering to pay, you can bet your bottom dollar that another company would be offering to buy out NICK for or at a higher share price. To the best of my knowledge, no one has coming "knocking on NICK's door" offering a higher share price. It is my opinion that NICK is getting a fair and adequate buyout offer because I do trust PSEC management and find them to be very conservative in marking and valuing their portfolio investments and the market is telling us that NICK is receiving a fair price because no other company "has called" looking to make an offer for NICK at a higher price. Secondly, PSEC has over 130 different portfolio companies that is has invested in versus NICK which is only involved in one industry. PSEC is much less "risky" than NICK, therefore, for the reason I just stated and with NICK becoming a portfolio company of PSEC, it brings more diversification to NICK shareholders as as well as a source of cheaper funding than NICK previously had access to. I understand and "get it" that the author wants more money for his NICK shares than what PSEC is offering to pay but the market is telling him (so far, anyway) that it ain't happening - to use some slang - and the buyout offer from PSEC to NICK is priced correctly. As I said in a previous post, as a current PSEC shareholder, I look forward to NICK becoming a new portfolio company of PSEC and I am quite certain that present NICK shareholders will be quite happy (over the long term) with their conversion into becoming PSEC shareholders.
    Mar 7 05:25 AM | 9 Likes Like |Link to Comment
  • Prospect's Growth Hides Bad Underwriting [View article]
    Robin: I have listened to numerous quarterly conference calls given by Mr. Barry (and Mr. Eliasek) as well as met Mr. Barry and Mr. Eliasek in person (at the annual meeting) and have found them to be quite intelligent, conservative in their outlook for the company, and extremely shareholder friendly. Additionally, Mr. Barry has purchased a "ton of PSEC stock," at price points way above the present stock price with no selling of that same stock in his future. Unlike most companies, Mr. Barry allows the "everday Joe," to listen and ask questions on the conference calls, and yet he doesn't know whether this ordinary shareholder asking questions on the conference call holds one share or thousands of shares of PSEC stock - a true advocate of the every day shareholder. In essence, I have not received or seen any negative attribute to Mr. Barry's character - either in person or in the quarterly conference calls. Lastly, my wife was a paralegal at the law firm of Davis, Polk & Wardwell, back in the late 80's and early 90's and she said that the law partners were very hard working and brilliant and super motivated for financial success for themselves and for the firm. Therefore, when performing my due diligence on PSEC stock, back in 2010, and while reading the biography of Mr. Barry having been a partner at Davis, Polk & Wardwell, it instilled a most favorable impression that Prospect was being run by a harworking and super motivated for CEO and providing the fundamentals of the company (PSEC) were sound - I wanted "in" on this investment. So far, neither Prospect Capital nor it's CEO, John Barry, have disappointed me. I hope it stays that way.
    Mar 5 09:59 PM | 4 Likes Like |Link to Comment
  • Prospect's Growth Hides Bad Underwriting [View article]
    Robin Heiderscheit: You commented "having worked with Mr. Barry in the 90's when he was a lawyer at Davis Polk, I have been negative (and more wrong than right) on PSEC since day one," and I was curious as to the reason for your negative assessment of Mr. Barry? The reason? I think and believe that a CEO's character traits are very important distinguishing factors in the ability to run a company (PSEC) and if anyone is going to be a steward of my money (my investment in PSEC stock), I would want to know all positive and negative attributes that characterize the person (CEO) running the company that I am invested in, and for investment reasons and not ad hominem reasons, I would appreciate you giving me/us more "color" on why you have been "negative" on PSEC since your days of working (and I presume "knowing") with John Barry.
    Mar 5 05:44 AM | 1 Like Like |Link to Comment
  • Prospect's Growth Hides Bad Underwriting [View article]
    PSEC has not had a loan/investment go to non-accrual in 6 years and counting. In the year of 2009, "the financial world was coming to an end," which certainly was a "convenient starting point" for the author to begin his analysis on the perils of owning PSEC stock. Of course, since that time, the CEO, COO, and CFO, have done nothing but continually made open purchases of PSEC stock. The market capitalization of PSEC has gone from the millions in 2009 to now trading in the billions (3.1 billion market capitalization), so I can see how the author could be quite "worried and concerned" about the riskiness of holding PSEC stock. Equally important, the CEO of Nicholas Financial is so worried about the riskiness of PSEC that he decided to sell his life's work (Nicholas Financial) to Prospect Capital. Wow, I can totally understand the author's concern and worries about PSEC stock. I only can hope that all of this riskiness and concern makes PSEC's stock price go down so that instead receiving an almost 12% monthly dividend payout, I can receive an even greater monthly dividend payout due to the stock price being temporarily depressed. Unfortunately for me, I don't believe I will have this luck, as the article by the author is not worth the computer it is written insofar as the article is so biased and rift with self-serving intentions that a reader with average to below average intelligence (no disrespect to any SA reader - of course) will "see" and understand the "non-factor" aspect of this article, as it relates to upcoming acquisition of Nicholas Financial by Prospect Capital.
    Mar 3 01:20 PM | 21 Likes Like |Link to Comment
  • Nicholas Financial: A Bad Deal - Vote It Down, Replace Directors, And Profit [View article]
    Mr. Galler:

    The whole economy depends upon "cheap debt and a highly liquid market," - just like Nicholas Financial, so the above statement that you made about BDC's is applicable to practically every company that trades on the stock market exchanges. The next time "instead of taking 10 breaths before you respond to criticism," why don't you take 100 breaths instead, and thereafter, instead of responding to criticisms of your article or writing any "new" articles, please save your energy and spare us from the misinformation that you perpetuate regarding the upcoming acquisition of Nicholas Financial by Prospect Capital. I look forward to having Nicholas Financial become part of the many wonderful portfolio companies that Prospect Capital is an investor in, and I am certain that the present Nicholas Financial shareholders will vote "yes" to the acquisition and be much richer for it. I can't wait to continue to receive the 11.7% monthly dividend payment that Prospect Capital pays out "from it's highly illiquid and leveraged" portfolio companies and Prospect Capital having Nicholas Financial "in it's family" is sure to increase the payout for BOTH present Prospect Capital shareholders and future Prospect Capital shareholders that were former Nicholas Financial shareholders. I will take your advice and "keep my PSEC," and my advice to you is to "keep your misinformation about BDC's generally, and about PSEC specifically, to yourself - where it belongs.
    Feb 23 11:20 AM | 2 Likes Like |Link to Comment
  • Nicholas Financial: A Bad Deal - Vote It Down, Replace Directors, And Profit [View article]
    I really believe that the author of this article "does not know what he is talking about." To say that Prospect Capital is a "highly leveraged company" is practically bordering on outright lying let alone ludicrous. BDC's are allowed - by law - to be levered one for one. PSEC is has .46-.55 for one, which is way below the average BDC's average leverage level. Just this false and inaccurate statement alone should make the readers of this article question all of the "facts" that this author has written about PSEC and about the transaction between PSEC and Nicholas Financial. Nicholas Financial is getting an excellent deal from PSEC and consummation of the deal will allow Nicholas Financial access to lower cost funding from PSEC than it was previously receiving from it's prior lenders. The CEO of PSEC, John Barry, has purchased more than 30 million dollars of PSEC stock with his hard earned money and has not sold a single solitary share. Additionally, the COO, Grier Eliasek, and the CFO also own substantial shares of PSEC purchased with their own hard earned money. Therefore, the management of PSEC and the management of Nicholas Financial has substantial "skin in the game," in their respective companies and with this potential acquisition which will ultimately be a moneymaker for both shareholders of each company (Prospect and Nicholas).
    Feb 22 10:11 PM | 2 Likes Like |Link to Comment
  • AT&T (T) has reportedly been thwarted in a €70B bid to acquire Telefonica (TEF) by Spain's government, which has the power to stop the sale of any company that is deemed strategic. The U.S. carrier told state representatives that it would take on the Spanish operator's €52B of debt as part of any transaction. Telefonica said it hasn't "received any approach or...indication of interest," from AT&T. [View news story]
    Please know your "geography." Spain is not Latin America, it is a European country. Therefore, if you want to talk about "geographical hubris," you would say "typical European hubris," and not "typical Latin hubris."
    Jun 17 05:42 AM | 1 Like Like |Link to Comment
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