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

To: TimbaBear who wrote (13603)	1/5/2002 3:49:41 PM
From: Night Trader	Read Replies (2) \| Respond to of 78704

TimbaBear, I wonder if you (or anyone else) could take a look at the following company. International Aircraft investors (IAIS), trading at around $1.60, owns and leases a fleet of 15 airliners to smaller airlines. It has fallen hugely over the past few months due to fears of contraction in the industry. It has been profitable over the past 5 years with an average income of 30 cents a share. Moreover, as I understand it the planes are depreciated at 7% while the real world rate is closer to 5%. This difference of 2 percentage points equals 4.5 million, almost the market cap of the company. Tangible book is about $10 a share but that may be understated for the same reason as above. There has also been insider buying (post 9/11) by 3 different people at 2-3 times todays prices (and already 66% insider owned): biz.yahoo.com Risks are the continuance of demand for used airliners and the very high amount of debt, though that is being paid off by 5 million a quarter. The book value is highly leveraged to the value of their fleet, so that if that value was reduced greatly the book value would vanish. Being so small now it is also fairly illiquid, so much so that with some moderate buying in late December I now hold close to 1% of the float. I would not invest any money you could not afford to lose - the stock is basically a call option with no expiration. Still the risk/reward looks favorable to me.

To: TimbaBear who wrote (13603)	1/6/2002 2:01:15 PM
From: isopatch	Respond to of 78704

Timba. Yes Capex has to be included. It's one of the most important considerations with energy stocks. Oil and Gas is one of the most capital intensive industries. Only have a partial position in CRED myself due, in part, to the low volume. In fact, that's what prompted me to shy away from PHOC. Although it's somewhat interesting, vol is so low, it's an easy target for a small group of traders to manipulate. Have seen that happen many times in companies with illiquid markets for their shares. Have you looked at HOFF. Some good value parameters there and it's making money due to the fundamentals driving energy markets in the current environment. Cheers, Isopatch