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

To: Paul Senior who wrote (30863)	5/7/2008 12:01:57 PM
From: Jurgis Bekepuris	Read Replies (1) \| Respond to of 78627

ACAS - I am not sure why so much rejoicing at the announcement. I looked at it and all I see is that the company is becoming even more impossible to value for an outsider. It's now totally "faith" based investment based on management claims. Well, most of BDCs are such investments, so it's not really a surprise, but why should I be happy about it? In short: there is no ROE since we have writedowns, P/Book is also not "clean" due to the management claims that the "GAAP" prices of the assets are way lower than "real" prices. I am considering selling. The only reason I hold it is that it's pretty obvious that macro-wise financials are cheap. Even Munger said something to that extent which is like Buffett commented is the most optimistic he has heard Munger to be for ages. ;) I wonder though why I should not swap ACAS into Buffett's WFC/USB...

To: Paul Senior who wrote (30863)	5/7/2008 1:20:30 PM
From: Grommit	Read Replies (1) \| Respond to of 78627

ACAS-- I listened to the cc/slides. They are very comfortable with this year and next year's dividend. They took the hit and wrote everything down to mkt, because ratios dropped in this qtr, they claim. I am not so sure they shouldn't have taken some of the hit last qtr, but I think they really did write it all down. With that cloud lifted, and a better understanding of GAPP and "non-GAPP NAV" (my words), I can wait it out while the value of the shares appreciate to better levels. I agree that the company is a bitch to understand, but I have been studying it for years. I trust these clowns. :o) The shares that I recently purchased in the $30 range will go into my long term pile. That pile was shares from 2002 and 2003 and under $20 average basis. But I still have some other shares from last year and this year (avg basis $35) to sell when they get above water. americancapital.com