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

To: Spekulatius who wrote (43742)	8/6/2011 10:45:50 AM
From: E_K_S	Read Replies (1) \| Respond to of 78731

I generally agree with you Clownbuck. I have been selling down my REIT preferred shares booking my gains from when I purchased them in the 2009 debt crash at a significant discount. I would rather hold the cash earning a negative rate of return than riding down these shares back to my original cost basis. Any new equities I have been buying must follow my general LT debt guidelines where annual net income must cover the long term debt w/i four years or less. I also only buy equities that own hard assets like oil and/or own a franchise that generate tons of free cash flow (ie pipe line companies w/ low debt) and/or significantly undervalued companies w/ very low PE and selling below book (definitely No financial companies). I was lucky to sell my only top 10 holding in a financial community bank (NYB)recently and I own only a stub position that has a very low cost basis. In fact I have been a net seller of stocks since March 2011 building up my cash reserves. I do not anticipate the extreme credit implosion like we experienced in 2008/2009 but those companies that have not deleveraged their balance sheet will be negatively impacted by higher interest rates and a slowing economy. I do think there will be some unique opportunities to pick up some undervalued assets as long as you have the cash and are willing to wait 18-24 months for values to begin to move higher. ------------------------------------------------------------------------------------------------------- How do you see the S&P downgrade in the U.S. credit rating playing out Monday and into the week/months ahead? Do you think Congress will get the message that they need to do something more substantial on the budget? After a brief negative reaction (this is the time you place your low ball GTC Willy bids in), I expect the Fed to announce a new QE3 program that should stabilize the markets. Eventually the survivors will be those company's will little or no debt that deliver "must have" products or services (food falls into that category). During the next several months/years, we will probably see more bankruptcies, fire side asset sales and a forced deleveraging by Mr. Market. Ironically, Treasuries will probably still be the save haven for idle cash. EKS

To: Spekulatius who wrote (43742)	9/28/2011 12:33:01 PM
From: Grommit	Respond to of 78731

AHT -- you might want to look at this one again. There is risk if the economy crashes, but that is true of everything. EKS and Clown: mentioned AHT's debt maturities: "...a new $105 million senior credit facility which replaces the Company's previous credit line that was scheduled to mature in April 2012. The new credit facility provides for a three-year revolving line of credit at 275 to 350 basis points over LIBOR, which is the same as the Company's previous credit line...The new credit facility includes the opportunity to expand the borrowing capacity by up to $45 million to an aggregate size of $150 million." finance.yahoo.com With the stock crashing over the past 2 months, they announced a buyback yesterday, which might be the reason for today's price increase. finance.yahoo.com finance.yahoo.com I am fairly comfortable with the stock under $10, especially under $8. finance.yahoo.com (HPT is another hotel. It has lower debt, but higher PE. HPT's PE is <7, vs AHT's PE <4) outlook from NYT (sept 26): nytimes.com ...hotel prices in major markets are way up. In fact, hotel rates are up across the board in the United States, as growing demand improves fortunes for the lodgings industry. PKF Hospitality Research recently revised its 2011 forecast for domestic revenue growth for the industry, saying that “it’s tough not to be optimistic” about future growth, despite a stalled economy. PKF Hospitality Research says that it now expects average room rates in the country to rise 3.2 percent this year. Last year, the other two top industry measures, occupancy rates and revenue per available room, also increased after declines in 2008 and 2009. In Manhattan, the news has been especially good for the industry, if not for those of us booking a room. In the second quarter, for example, the average daily rate for rooms increased 9.2 percent, PricewaterhouseCoopers, the research firm, found. The upscale hotel segment, by the way, had the biggest increase in revenue per room, up 9.1 percent. ........... I owned some $4 shares from 2009, bought more during this year at $11+, and recently bought more in early august at $8 to $10, after they dropped from $13. Over the past month I made up for it by buying more at $6.20 to $7.00. (My avg price is now around $8.) AHT sold fresh shares at $12.50 last July: 06/29/2011. Ashford Hospitality Trust, Inc. (NYSE: AHT) today announced that it has priced its underwritten public offering of 7.0 million shares of its common stock at $12.50 per share. Ashford granted the underwriters a 30-day option to purchase up to an additional 1,050,000 shares to cover over-allotments, if any. Settlement of the offering is expected to occur on July 5, 2011. Stock moved from $6.20 when I posted 2 days ago, near $7.40 now.