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Strategies & Market Trends : Value Investing

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From: MikeS97707	3/26/2009 11:32:38 AM
	1 Recommendation Read Replies (3) of 78753

I picked up some WLFCP this morning which looks like a great deal in the $6.20s. This is a preferred stock with a preference value of $10 and an interest rate of 9% at par. At the current price of the preferred the yield is 14.4%. Interest is paid monthly. Last night the company came out with their Q4 report which was very good (look under WLFC for the report). They made $0.41 per share on an 8% increase in revenue. EPS would have been even higher if it weren't for a somewhat higher equipment writedown this year. Book value is $17.66 per common share and the common shares trade at $9.72. They also indicated that there is strength in their business during the economic downturn. IMO the discount in the preferred shares is not justified. The company is on very solid footing and the 9% interest rate and yield of 14.4% is very nice. I think the preferred stock should be trading in the $9-$10 range right now and expect it to move up as people notice.

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