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Strategies & Market Trends : Value Investing

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To: E_K_S who wrote (43009)	6/14/2011 1:05:38 PM
From: MCsweet	1 Recommendation of 78652

TTT, I still own some TTT at a 5.05 (spin-off adjusted) cost basis from a rights offering situation I recommended here last year. I have one comment on management that may or may not be helpful. Michael Smith is a smart CEO, but his companies often have complex ownership structures and transactions. I think he and his top investors make out well, but you have to be careful to look out for your own interests. (I have joked that Smith seems to me to be a mixture of Warren Buffet and Jeff Skilling.) For example, TTT had a rights offering and a couple spin-offs of KHDHF shares, then a merger with MFCA (I think that is the ticker), apparently to the detriment of MFCA. What's more, KHDHF shares then had their own rights offering. Participating in all these worked out, but those not paying attention got heavily diluted. And then in Q1 this year management had 7.3 million of share expense for newly issued stock options. On the other hand I like being able to own smart managers at a reasonable price. A commodity sell off is not necessarily bad for them, as it might allow them to buy a company/royalty on the cheap. MC

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