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Strategies & Market Trends : Value Investing
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To: Paul Senior who wrote (72849)6/15/2023 3:49:39 PM
From: Harshu Vyas  Read Replies (2) of 78749
 
Dear Paul Sr,

The problem with DLR is the unsustainable capex shown on the cash flow statement. The negative free cash flow of close to $400m in Q1 is worrying. Further, the fact that they were forced to borrow over $1b in the quarter to sustain this cash burn makes the sustainability of the dividend questionable (interest is getting far more expensive and refinancing will be interesting, for sure).

Net debt stands at $19b with OCF not growing for the past half-decade.
To make matters worse, the share count is increasing making your investment worth less.

Further - I wouldn't like someone like Chanos against me (though, that's probably my lack of experience talking).

I think this is a very risky position with no real upside. Would like to hear more from your side.

I hope this doesn't come across as disrespectful - I do appreciate your investment experience and investment success. After all, you've been doing this from before I was even born!

Best,
Harshu Vyas
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