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koleffstephan

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  • Prospect Capital: Why A 22% NAV Discount Won't Trigger A Buyback [View article]
    Hi Scott:

    That was an awesome article that you wrote about PSEC. I too, have had telephone conversations with Michael Cimini and Grier Eliasek, head of investor relations and Chief Operating Officer of PSEC, respectively, to discuss Prospect and the investor perceptions (misperceptions) as well as my frustration with the lagging stock price and now - with the recent announcement in December of 2014 - the recent dividend reduction. I have also had email communications with the CEO, Mr. Barry, about Prospect and my investment in the company. Your article "answered" some of the still lagging questions that I had about the business rationale for some of their decisions (I am a health care practitioner not a financial guru) since "financial accounting" does not come easy for me - so to speak. I do think that message poster BigA170 posed a question that many PSEC shareholders have had in their mind as to "how PSEC could give these upcoming rights offerings to it's shareholders at a discount and still remain NAV neutral?" You answered the question (hypothetically) but I think a 5% discount is not going to compel most PSEC shareholders to participate in the rights offering unfortunately, and most will try to sell their rights on the open market (if there is a market for these rights). I was wondering what your thoughts are as to how many rights PSEC will offer it's shareholders per how many PSEC shares the shareholder owns? I know you have no special knowledge or authority but since you hypothesized that PSEC would offer the rights at about 5% discount to the intrinsic value of the upcoming spin-off, I was also wondering what you hypothesize will be the ratio between shares of PSEC stock that a shareholder owns versus how many rights offerings a PSEC shareholder will receive for those same ownership of shares? Secondly, I was wondering what your thoughts are as to the "order" of the upcoming spin-offs, with PSEC deciding to spin-off the CLO business first rather than the real estate business or the online lending business? It would seem that the CLO business is a much "riskier" business than the real estate business coupled with interest rates being so low and therefore bonds (CLO) being priced so high (relatively and mark to market speaking) that I was wondering if PSEC is unloading the CLO business first because they think that the market is ripe to have these CLO's (CLO business spin-off) priced/overvalued right now? If so, a PSEC shareholder might still be overpaying for the new CLO spin-off shares (even with the discount) - no? Thirdly, do you have any educated guess as to how much these newly issued CLO (Prospect Hi Yield) shares will be yielding per month? Lastly, I think the "general theme" of your article and most of PSEC's troubles (lagging stock price) comes down to "general distrust" of PSEC management. Granted, your article articulately and precisely outlines some of the steps that PSEC could/should take to restore shareholder trust but I think that at this juncture, irrespective of the future steps that PSEC management takes or doesn't take to steward the company, investors and shareholders will not "reward" Prospect with a higher share price for a long time. Therefore, I think that PSEC has to simply continue to run the business thoroughly and competently (as I think it does and is the reason that I am a long time shareholder) and look to not only pay it's regular dividend but also look to issue a special dividend or two, throughout the year and in due time, I believe present and potential PSEC shareholder will begin to appreciate the monthly income that this company generates and award with a much share price than it deserves. Total return is great but unless a shareholder is buying and selling shares continually to realize those returns - it means nothing. Monthly dividend income with eventual long term share price appreciation is "where it's at," as far as I am concerned. Thanks for a beautiful article and if you have the time to answer my questions as well as add some additional commentary it would be much appreciated.
    May 15, 2015. 07:25 AM | 9 Likes Like |Link to Comment
  • Prospect Capital's Results For Fiscal Q3 2015 - My Assessment [View article]
    Hi Scott: After I wrote and sent you my question, I "realized" that it probably had to do with fiscal years and fiscal accounting but I appreciate you responding and clarifying for me the reason. I do hope that the spin-offs are done sooner rather than later as I believe the stock price is lagging in part because of the "overhang" of uncertainty regarding the value - if any - of these spinoffs. As always, thank you for your most informative article.
    May 13, 2015. 08:47 AM | 1 Like Like |Link to Comment
  • Prospect Capital's Results For Fiscal Q3 2015 - My Assessment [View article]
    Scott: Why from an organizational and accounting standpoint would it make the most sense for the 3 proposed spin-offs that PSEC is working on be completed by July 1, 2015?

    Also, thank you for your most informative and detailed article on PSEC - fabulous - as usual.
    May 11, 2015. 09:00 AM | 2 Likes Like |Link to Comment
  • Prospect Capital: Continued NAV Declines? [View article]
    sme20: I too, agree with your assessment of the conference call. The last 2 questions that were asked did not seem to be "true analysts" but rather ordinary shareholders asking questions. I have not problem with "ordinary shareholders" as I am one of them, but PSEC management decided a few quarters ago to no longer take questions from ordinary retail shareholders because in doing so, it "pissed off" the "true" analysts that were covering the call because it took too much time and delay from the analysts. I personally think that the analysts were too "uppity" and did not want us peons for shareholders sharing the same forum as them during the conference call. I know this to be true because I spoke to PSEC Investor Relations about it last year, as well as having an email exchange with Mr. John Barry myself. I too, was cut off in queue, last year, waiting to ask my questions. Most if not all public companies DO NOT allow ordinary shareholders to participate in quarterly conference calls so PSEC management is not being an outlier here. Again, I have a hard time believing that the last 2 "analysts" that asked questions on this conference call were true analysts. Having said that, I do agree that it appeared that Mr. Barry "cut off" the remaining analysts - assuming there were analysts still in need of asking questions rather than ordinary shareholders - from being able to ask questions that would have given all listeners a more complete analysis of the quarter. I will say, however, that seeing and hearing that Mr. Jonathan Bock (The Wells Fargo Analyst) was not covering this quarterly conference call was rather conspicuous by his absence and I was wondering the reason for it, since he was rather critical of PSEC management on the last quarterly conference call. Either he could not attend this call or PSEC management did not want him there (not professional on PSEC's part, if the latter is the reason for Mr. Bock not being on this call). I believe that PSEC's stock price lags significantly right now compared to it's NAV because of the uncertainty of the upcoming spin-offs as to those spin-offs representing value to shareholders as well as what will be the potential tax burden to already existing PSEC shareholders. To me, that is the primary reason for PSEC selling off since it's last quarterly conference call. We shall see.
    May 8, 2015. 02:19 PM | 1 Like Like |Link to Comment
  • Prospect Capital: Continued NAV Declines? [View article]
    sme20: I agree with your commentary. Unfortunately for us (long time PSEC shareholders), the general investing community is not trusting of the management team of PSEC. I understand some of the "investing community feelings" about the management team. On the converse, I trust the management and hence, my continued involvement (investment) in PSEC stock. Call me stupid (many message posters most definitely think to themselves or out loud that I am/may be stupid) but I don't care how much money the CEO (John Barry) makes per year in management fees, he has invested probably at least 60 million dollars in PSEC stock (not the present market value of his PSEC stock holdings but his actual cost basis in purchasing PSEC stock) and if many message posters on this SA message post think that Mr. Barry is as greedy as the say he is, there is no way in hell that Mr. Barry is going to let the share price of PSEC continue to lag and there is no way that Mr. Barry is going to "lose" money on his investment. Just my opinion but again, what the hell do I know.
    May 7, 2015. 06:21 AM | 1 Like Like |Link to Comment
  • Prospect Capital: Continued NAV Declines? [View article]
    BDC Buzz: Agreed.
    May 7, 2015. 06:13 AM | 1 Like Like |Link to Comment
  • Prospect Capital: Continued NAV Declines? [View article]
    kenyatta: Respectfully speaking, I have or own more shares of PSEC than the 8000 that you referenced - just for complete and true and full disclosure.
    May 6, 2015. 10:29 PM | Likes Like |Link to Comment
  • Prospect Capital: Continued NAV Declines? [View article]
    sme20 & gawilley: I agree "HYD - Now thats funny!"
    May 6, 2015. 10:26 PM | Likes Like |Link to Comment
  • Prospect Capital: Continued NAV Declines? [View article]
    sme20: I too, am a "significant investor" in PSEC shares and like you, am waiting to see how these rights offering play out as well as waiting to see what kind of special dividend PSEC is going to dish out towards the end of the year (my belief is that the rights offering is NOT going to be PSEC's management idea of having issued existing shareholders a "special dividend). As I said in a previous post, I purchased another 3000 shares of PSEC at $8/10 per share 2 days ago and another 2000 shares of PSEC yesterday at $7.87/share, so I am putting my money where my mouth is but it still is frustrating to see the share price at these levels despite the 12.7% monthly dividend payout. What are your thoughts?
    May 6, 2015. 08:57 AM | 1 Like Like |Link to Comment
  • Prospect Capital: Continued NAV Declines? [View article]
    BDC Buzz: As you know, I have not been a fervent "fan" of your articles on PSEC, but I do believe that some of the measures that you have noted that PSEC management can or should take to increase NAV and by inference stock price and shareholder value (such as successful rights offering whereby shareholders make money on either selling their rights or being able to obtain the spin off CLO stock at a reduced price from market value; buying back some stock at these low levels; declaring a substantial special dividend) are most definitely needed for the investing community to re-gain confidence in the management team. I don't believe that PSEC management will reduce fees but that is just my opinion. I have had a recent telephone conversation with the Head of Investor Relations (about a month ago) and already conveyed some of the same suggestions that you wrote in this article about improving investor confidence in PSEC stock. I do believe that at these prices, PSEC does represent an excellent investing proposition which is why I purchased 3000 more shares 2 days ago at $8.10/share and I purchased another 2000 shares of PSEC yesterday at the price of $7.87/share. I do not know whether the information that you posted in this article is "already priced into the stock," as you suggest, but I think from a longer term perspective, the prices that I am buying PSEC at represent value. We shall see. In any event, your article listing in part, the measures that PSEC management could take or should take to restore investor confidence are agreed upon by myself and many of the PSEC shareholders that I have spoken to.
    May 6, 2015. 08:00 AM | 9 Likes Like |Link to Comment
  • Prospect Capital: What Comes Next? [View article]
    Hi Yield: I am surprised that you have time to read and post on the PSEC SA message board after reading all of the MAIN message posts and the Buzzard's offline premium content. Keep purchasing MAIN at a 50 percent premium from it's NAV and in your spare time, keep reading and paying for the Buzzard's subscription service. Let's see where that gets you. Also, please keep "taunting" me as PSEC's stock price goes down - to quote your own words. I have no worries or fears about PSEC stock price in the long run.
    Apr 29, 2015. 06:32 AM | Likes Like |Link to Comment
  • Prospect Capital: What Comes Next? [View article]
    Hi John Wayne: Nice article. I agree with our commentary. Also, I guess your message post is "biased" and somehow, someway, message poster, Hi Yield Drip, is not biased? Yea right. As Shakespeare said, "Me thinks he doth protest too much."

    Unless a shareholder is buying and selling MAIN stock on a regular basis for total return, you can't beat the PSEC dividend payout compared to MAIN. Keep shootin partner - as Hi Yield said.
    Apr 29, 2015. 06:22 AM | Likes Like |Link to Comment
  • Prospect Capital: What Comes Next? [View article]
    Hi Yield Drip:

    Good luck with paying for the offline content that BDC Buzz offers.
    Apr 29, 2015. 06:12 AM | Likes Like |Link to Comment
  • Prospect Capital's Fiscal Q3 2015 NII And NAV Projection [View article]
    Hi Scott:
    As always, I really enjoyed your article on PSEC. It's always comprehensive, objective, balanced,and well-researched. I have a question about the upcoming Rights Offering of Prospect Yield Corp (CLO Business). I understand that you cannot give "specifics" because PSEC management has been opaque with their discussion about this topic ( I guess we all hope that PSEC will be more specific about this topic in their next conference call). My understanding is that usually, the company issuing the Rights Offering offers those rights at a substantial discount to their shareholders as a "bonus" and and inducement to get the existing shareholders (in this instance, the existing shareholders of PSEC stock) to exercise their rights and purchase the stock (Hi Yield). Therefore, if PSEC does issues rights, so that we can exercise these rights and purchase Hi Yield at a substantial discount price than what the share price would be worth once it starts trading in the open market, then I would assume that this cannot be NAV neutral to Prospect Capital, as PSEC is saying and attempting to do? Correct? In other words, how can PSEC do a Rights Offering and give it's shareholders the opportunity to purchase stock at a substantial discount from what they feel is the true market worth of the company and yet keep this whole transaction/event NAV neutral to PSEC?
    My last question as to do with the tax situation for the individual shareholder on the issuance of the Rights Offering? I know that you cannot give specifics as each shareholder is different but I am asking for some generalities. Could you state what the tax implications would be/are for the shareholder under various scenarios? For example, if we don't exercise our Rights what the tax implications are? If we do exercise our rights, what the tax implications are? Again, this would all be under the assumption that the shares are held in a non-retirement account and not in a IRA or other qualified retirement account that most probably would not have these tax issues to "worry" about?
    Thanks again for your time and professionalism.
    Apr 29, 2015. 06:10 AM | 1 Like Like |Link to Comment
  • Prospect Capital: What Comes Next? [View article]
    sme20: When MAIN decided to issue dividend payment based on taxable income versus NII everything is "fine" with the "author" of various BDC articles but when PSEC management also decided to issue dividend payments based on taxable income versus NII, somehow and somewhere, PSEC management is "not covering their dividend payment." Kinda funny and a joke as to the hypocrisy of it all. PSEC trading below NAV with a close to 12 percent monthly dividend payment is kind of a no brainer.
    Apr 27, 2015. 09:34 PM | 2 Likes Like |Link to Comment
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