Stephen Ryan
Special situations, value, long/short equity

Hannon Armstrong: Transition To Balance Sheet Financing Should Provide 20% Upside, 7.3% Yield

Investment Thesis

I view Hannon Armstrong (NYSE:HASI) as a strong fundamental growth play with a risk adjusted yield comparable to that of an AAA (or equivalent) bond. Over the next four quarters (ending in Q2 2014) I believe Hannon Armstrong will grow its book 27%, and add $455 million to "investments in financing receivables" as a direct result of its post-IPO business plan. My BV forecast estimates that HASI has the ability to add $1.30 to its balance sheet for every $1.00 of equity/debt, which should increase the company's book to $550-$575 in tangible assets, and around $745-$752 in; "investments in financing receivables, and; on-balance sheet "securitization assets."

Second quarter results exhibited the origination and accretive...

Join Seeking Alpha PRO to read this archived article and 11,574 other archived articles
FREESA PRO MEMBERS
IDEA GENERATORXExclusive access to 10 PRO ideas every day
INVESTING IDEAS LIBRARYXExclusive access to PRO library of more than 15,000 ideas
SECTOR EXPERT NETWORKXExclusive access to all sector experts for direct consultation
PERFORMANCE TRACKINGXTrack performance of all PRO stock ideas
PROFESSIONAL TOOLSXProfessional Idea Filters to zero-in based on industry, market cap and more
PRO Top long ideas returned 21.7% in 2016**
"As a PRO member, we get uniquely valuable perspective that go beyond our quantiative analysis... We rely on PRO to get beyond the numbers quickly and add much needed perspective. It keeps me ahead of the next big thing. - Mark Choate, Malaga Cove Capital"
Mark Choate, Malaga Cove Capital
"Contributors (writers and commentators), often have a long history in the secuirities they opine on and some are clearly well positioned industry participants with detailed industry views that can help provide color on where the skeletons are buried in a particular secuirity and/or industry."
Jim Roumell, Roumell Asset Management
You may cancel at any time for any reason, and receive a prompt refund for membership on months paid and not used (max. 6 months). Details