Jim: Well, looks like you got a quick profit in PAH. Seems like a lot of REITS are up today and looks like on higher vol. than yesterday (per Yahoo). You've mentioned LHO a couple of times, and each time I've tried to reason myself into taking a small position. But I get overwhelmed. Market cap is small - they seem to have about 12 upscale properties - maybe too small to be reliable or to get a following to generate potential stock buyer interest. On the other hand, HOT was tiny once too. Plus the dividend for LHO 12%. That seems too good to be true. That's better than the long run record of the market (if LHO can sustain the dividend). Plus they have insider buys and are rated #13 in the Yahoo REIT category. (There're over 100 REITs in there -- overwhelming the number and the different sectors - industrial, shopping centers, Class A, Class B, health, etc. etc.) I don't really like to rely on Yahoo's analyst recommendations, but it's really hard for me to get a feel for these RE businesses, so maybe I will have to rely on 'professionals'.
LHO has a management arm that controls or manages the REIT. This management arm is, of course, the same people (I think) who are in the REIT. Plus this management does foreign investing also. If they are deal makers and not business people, that's generally been a clue for me that I might have trouble with the investment. I see there's another company, MHX, which seems similar (but much more aggressive perhaps). It has separated its management and REIT into two stock classes and it has a 12% dividend rate also. (Div. rate was 14%+ at one point). Also, both companies are similar in that they are new (under 3 years).
I'll think some more on LHO. The dividend is very attractive, and I can buy below what the insiders just recently purchased. (Cripes, there are a ton of REITs like that now it seems) One very strong point for me though, is that you recommend it. (Well maybe not recommend it to me exactly, but you are buying or have bought it for yourself.). And you don't make that many different buys (compared to me -ggg-), so I want to make sure I give some effort to see what you are suggesting.
I'm not really sure what your expectation is for the stock (I know you want it to recover to at least your buy points); for me, I think I will expect that profits I get will be more dividend than capital appreciation, and that I will need to hold this stock a while. Paul |
