Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: pcyhuang who wrote (28091)	9/17/2007 9:09:55 AM
From: Area51	Respond to of 78702

So value investors should invest in highly volatile speculative high fliers and pretend that they are "value" investors? NFI has been very volatile, but that is basically their business plan: to thrive when liquidity is loose and property values are rising and then try an survive when property values decline. NFI is worthy of consideration based on price to book. Especially if one expects a soft-landing in the current real estate debacle (because without a soft landing they are toast IMO). Or as a short term play on a 50 bp fed cut. Otherwise it is likely more of a value-trap than a value investment. A51

To: pcyhuang who wrote (28091)	9/17/2007 10:11:21 AM
From: MCsweet	Read Replies (3) \| Respond to of 78702

Value Investment Selection Criterion, Pcyhuang, a large short position is an indication of a value trap to me instead of a true value stock. Yes, sometimes the shorts are wrong and you do have potential for a short squeeze, but I'd rather buy something with good long term fundamentals and a large short interest is not indicative of that. Further, I have found my best returns have occurred with stocks that are unknown or not followed closely, not ones that are widely followed by professional investors (and hated enough that they would short it --- do they know something I don't, often the answer is yes). I don't have any comments with respect to NFI, except that it is too risky for me to consider either being long or short that one. MC

To: pcyhuang who wrote (28091)	9/17/2007 6:50:31 PM
From: E_K_S	Read Replies (1) \| Respond to of 78702

4:01PM Novastar Fin will not distribute REIT dividend after market changes make new issue of preferred securities not possible (NFI) 8.20 +0.10 : Co announces it will not proceed with declaring a dividend dividend on its common stock, as previously planned. NovaStar announced on July 16 that it intended to declare a dividend on its common stock, in the form of convertible preferred securities, to satisfy requirements to distribute approximately $157 million in 2006 taxable income to preserve its status as a Real Estate Investment Trust under the Internal Revenue Code of 1986. NovaStar said the decision not to declare a dividend related to 2006 taxable income will cause the Company's REIT status to be terminated, retroactive to January 1, 2006. As a result, NovaStar said it will file a consolidated tax return for the 2006 tax year today, in a timely manner, as a general C Corporation rather than as a REIT. The Company also will file a request for extension of time to pay its 2006 C Corporation tax liability, which is statutorily allowed under the Code. NovaStar said it expects that the termination of its REIT status for the 2006 tax year will have a significant adverse impact on its financial statements for the third quarter of 2007, which will include a period expense in the third quarter for the 2006 tax provision. As a result of NovaStar's change in corporate structure, the Company is currently reviewing the applicable New York Stock Exchange listing requirements and is engaged in continuing discussions with the NYSE. NovaStar Dropping REIT Designation biz.yahoo.com Stock down over 16% in AH after this announcement. Maybe the shorts were right or just knew about the news. EKS

To: pcyhuang who wrote (28091)	9/17/2007 11:32:32 PM
From: Mark Marcellus	Read Replies (1) \| Respond to of 78702

Since many value stocks are trading near their 52-wk lows, we need to add certain matrices, other than the traditional value ones, in finding the right candidates. pcyhuang, you remind me of the old story about the fellow whose friends found him one night combing frantically on the ground under a streetlight. "What are you looking for?" they ask. "My car keys." he says. "Where exactly did you lose them?" He points up the street. "Over there by my car." After a pause one of them asks, "So why are you looking here?". The reply: "Because the light is better here." There are many roads to investing success, but I would humbly suggest that if the goal is to find value stocks, "traditional value matrices" would be the way to go.