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Strategies & Market Trends : Technical analysis for shorts & longs
SPY 691.66-0.1%Jan 16 4:00 PM EST
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To: gizwick who wrote (54451)11/30/2021 6:53:46 PM
From: E_K_S3 Recommendations

Recommended By
Fast Eddie
FL_Guy
gizwick

   of 69859
 
I own both and I believe there are 5 quarters in the rears ; SOHON $2.06/year and SOHOB $2.00/year

So about $2.50/share in suspended dividends for each preferred.



What I learned from the filing today is they grossed $22 Million on this sale. Remember that their balance sheet reflects cost not market price for their real estate holdings. They also run many of their properties in separate holding companies as operating partner along w/ other partners so it is a bit convoluted in identifying true ownership of the asset, what is owed (in the case of this property there was an outstanding loan which may have also incumbered other hotel property assets) and the portion of income earned from each partnership/operator.

The big surprise is their stated BV may be understated by as much as 2x if you use the $21 million cost vs $43 Million sale as the more accurate 'retail' price of all their real estate fair market value.

Stated BV is $1.99/share but may/could be near $4/share.

That said, the preferreds are undervalued and really could be paid off easily if/when they sell other properties and/or are just bought out. Remember there is a change of control provision that says all preferreds must be paid off at PAR on any change of control. Perhaps it's possible to get around this because of the way they hold title to the different hotel assets (as evidenced by this transaction).

It still proves that this micro-cap (market Cap of $36 million) may be undervalued but the real value is in their preferreds as well as the debt holders.
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