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

To: Jurgis Bekepuris who wrote (55728)	7/23/2015 11:04:12 AM
From: E_K_S	Respond to of 78704

Re: SFY Debt Yes I saw that. The initial pricing was North of 10.5% and the company said they had other options. There was some internet chatter of a JV deal in the works for new well development on the Eagle Ford property. If/when they do a Debt for equity offer/exchange, a fair value exchange offer/price might be $0.67/100. Therefore, my exit strategy is: 1) if an exchange for debt is offered, then I would take it as long as the debt exchange value is $0.67/100 or higher AND I can sell the new shares immediately; 2) continue to hold debt and receive semiannual interest until it defaults; and/or 3) understand liquidity for the bonds is soft and watch. My exposure not too much so it will be interesting to see how the asset value(s) play out. In all cases, better than holding the common shares. EKS

To: Jurgis Bekepuris who wrote (55728)	7/23/2015 4:55:54 PM
From: Brian Sullivan	Respond to of 78704

United Rentals, Inc Stock Down 13% After Mixed Earnings: Here's What You Should Know fool.com What: Shares of heavy-duty equipment and tools rental company United Rentals, ( NYSE:URI) are down more than 13% so far today. If the decline holds, the company will have lost one-third of its market value this year: So what: The company reported better than projected adjusted second quarter earnings on July 22, but GAAP (generally accepted accounting principles) earnings came up a little short, and declined from the year-ago period. But the big news was a downward revision on the company's guidance for the remainder of the year: United Rentals sales are up from last year, and management says demand should be strong in the future especially as nonresidential construction picks up, but the company cut its outlook for the rest of 2015, largely on continuing weakness in locations that serve the energy industry, specifically oil and gas exploration & production, and oilfield services. This is leading to cuts in pricing, which will bring down what the company had been expecting a year where it was able to increase rental rates 3%, to relatively flat pricing, and will also cut the company's time utilization metric, which measures the percentage of available time the company's equipment fleet is under rental contract. In response, the company is slightly reducing its planned investment in its equipment inventory, and will instead accelerate its share buyback program. Now what: Management clearly thinks this sell-off is creating a buying opportunity. As of June 30, it had $197 million remaining on its existing $750 million buyback approval, and said it will complete that program by year-end. But that's just the start, as the board approved another round of buybacks, this time for $1 billion which will be completed within 18 months of initiation. In other words, the company plans to spend $1.2 billion in share buybacks over the next two years. At current market value, that's almost 20% of the company's shares. All things considered, this could be an opportunity to buy. If the market is indeed overselling on the weakness in demand in the energy industry, and nonresidential construction continues to recover, the share buyback program alone could make this a market-beating stock over the next few years. However, there remains some uncertainty around the energy sector, so it's worth doing a little more research on your own before pulling the trigger. After all, it still has to come up with that billion bucks for the share buybacks, and already carries more than $8 billion in debt. I'd want to know how the company plans to pay for those shares before pulling the trigger.

To: Jurgis Bekepuris who wrote (55728)	7/28/2015 9:30:21 PM
From: E_K_S	Read Replies (1) \| Respond to of 78704

Swift Energy hires firm to weigh financial options SFY says it is exploring alternatives to realigning its balance sheet and senior notes, which it contends are trading at levels significantly below face value. Lazard was hired to advise on what options they have for re-capitalizing debt and/or monetizing some of their hard assets. The firm advises on alternatives to a sale such as recapitalizations, spin-offs, carve-outs and split-offs. -------------------------------------- After finding that their credit facility refinance was too expensive, management is now looking to Lazard for other options. They can probably structure a debt for equity exchange (hopefully w/ low fees) as one of their options. XCO is taking a different route a reverse split on their common and then issuing more shares. SFY does have their Louisiana asset that is on the block w/ no offers. Maybe they can do some type of "carve-out" and sell to a private equity fund/buyer. That option for SFY is a good option but does not generate fees for Lazard. EKS

To: Jurgis Bekepuris who wrote (55728)	8/2/2015 4:19:58 PM
From: E_K_S	Read Replies (1) \| Respond to of 78704

Re: Distressed Senior Debt (The Value play) Marc Lasry was this week's host on Wall Street week. goo.gl It was a timely interview as he discussed the distressed Senior Debt opportunities in the Oil & Gas sector. At about 20 min into the interview he explains his strategy at buying debt at the right price ($0.40-$0.50 on the dollar) and if/when a per-structured bankruptcy may/should occur, bond holders typically will receive $0.60-$0.70 on the dollar. Lasry has a lot of experience working in the BK industry before starting his hedge fund. He is also finding distressed debt 'values' in Europe specifically w/ banks that carry too much leverage and are being "forced sellers of debt" by the ECB in order to reduce leverage amounts. His fund is on the other side of this trade, buying the debt for $0.70 on the dollar and if/when the banks restructure their loans get paid off at PAR (usually 3 years or less). He did state that if/when the restructure terms are announced, they will sell at $0.90 on the dollar for a quick return on their investment. What was interesting is his successes (70% annual return for past 6 years: 2009 & 2011 best years) were in those cases where their was panic selling (typically in the common shares). He was buying the distressed debt issues at 50% below PAR and collecting the semi annual interest payments waiting for management's pre-packaged BK offer(s). -------------------------------------------------------------------------- Mr. Lasry follows my general investment theme; Buy assets for $0.60 cents on the dollar and sell them for $0.90 cents on the dollar. In all cases (for him) there were better returns buying the distressed debt than the common shares. Buyer beware, it's still loaded w/ a lot of risk. He also talked about distressed debt for China State owned companies but to me, that sounded way to risky. EKS