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

To: E_K_S who wrote (66425)	2/5/2021 7:07:07 PM
From: Paul Senior	1 Recommendation Recommended By E_K_S Read Replies (2) \| Respond to of 78745

Yeah, FPH has those environmental, clean-up contamination issues in San Francisco. And the company/stock really requires more than my usual skimpy stuff like "fits my value criteria" Here's why I believe we can overlook the environmental aspect for now. The two other planned communities are in Southern California - one in Orange County and the other, Valencia north of Los Angeles. For Valencia, FPH is planning for 21000 homes and commercial development. (Mixed Use) Early last year FPH sold to builders 711 lots for a purchase price of $135M. So $190K per homesite. They sold 70 more, but they hadn't closed at the time, and FPH didn't disclose the sale price for those. In Jan this year, FPH reported that in the 4th q of last year the Company sold 487 additional homesites for a gross purchase price of $115 million. =$236K per site. Not sure what "gross" purchase means, but I'll take out 10% to guess for make-ready, sales incentives, commissions,etc. So my estimate they got $213k net per homesite. . Well, location, location, location. Maybe the best sites (most expensive - are selling first). Otoh, as the land develops out, it might create selling momentum as prospective builders/home buyers see what is happening. So lot prices might rise. Anyway... 21000 less 1268 already sold and at $200K per lot. = $3.9B in sales proceeds. Which does not include sales for commercial properties (Maybe FPH will develop that stream by itself.). Nor does it include sales from Orange County or San Francisco. FPH has a market cap of $.9B and rough enterprise value of $1.3B So this company is terribly undervalued IF FPH can actually develop 21000 Valencia homesites and do it faster than about 1000 per year. -g- And those other two California areas will have value as well. JMO. LTBH for me. I could be wrong.