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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Michael Burry who wrote (8184)	9/9/1999 2:09:00 PM
From: Wallace Rivers	Read Replies (1) \| Respond to of 78842

Anyone interested in CMO at 4 bucks? Assuming NAV will take a slight haircut to about $7/share, you get the assets at about 57% of what they are worth in the market. Last Q's dividend was .18 on earnings of .19. I, and many others estimate the dividend will be .14-.15 this Q. At the .14 figure, assuming the dividend holds (a big assumption), the stock is pegged to yield 14%. Let's say the div. drops to .12, yield drops to a mere 12%. Huge share buyback is in place, and probably ongoing. Comments anyone? The above, of course, is my opinion only, and, as has happened many times in the past, I could very well be wrong!

To: Michael Burry who wrote (8184)	9/9/1999 3:59:00 PM
From: Paul Senior	Read Replies (2) \| Respond to of 78842

Mike, re: FTL. Yes, taking it in the shorts with FTL. Have all my Fruit of the Loom shares, buying more today. Well, this situation is scary. Difficult to see how it might end favorably. I've been in situations like this before- averaging down and down, only to see the company drop into bankruptcy. Not pleasant. I'd guess for people here who didn't see value at higher price, if they see value now, it ought to be totally obscured by the rapid and precipitous decline in FTL stock price. FTL has a number of problems. The stated problem (i.e. the problem they say) is that they're having difficulty meeting customer demand. Imo, if true, whatever the reason - they moved plants off shore, customers suddenly increased orders, customers unexpectedly changed the types of orders -- these problems should all be temporary. There is also some problem with Mr. Farley, the head guy, who is now going to be replaced. Per Yahoo, this guy might have been self-serving in some of the deals he's done with the company and/or he terribly hurt the business in the way he has run the company. My concern is that I don't know how much damage the man has done, but I assume (without having any facts though) a lot of damage since we're seeing the stock crater. That FTL is/or might be in violation of loan covenants is not worrisome to me. (FTL has too much debt and that is a problem though.) FTL has been around a long time. People are still wearing underwear. (Uh- that would be an assumption by me. I defer to you, the physician, who has more of an opportunity to see people in various stages of (un)dress -g-.) FTL's got a good market share and in past, has been able to make a profit. I don't see why they can not get their business act together again. I'll assume that the FTL bond holders will try to allow FTL a little space to do so, or maybe require that FTL sell some assets, just so that they don't have to fight FTL in bankruptcy court. I just hope FTL suppliers will not panic and somehow throw FTL into bankruptcy. I am increasing my bet that FTL will muddle through. There is a business here. I don't know what the value is, but the stock seems to be at a decade low. For many years the business was valued between $20-30/share by the market. I think the reward is there. But clearly, the risk is most definitely there, and most predominant now. Since the stock seems to be experiencing a two-day half-life, I think the wisest course for others right now might be to wait a bit to see what happens -until the situation at least stabilizes anyway. Paul