thanks for your insite....i agree that with good core earnings it's a good stock...i'm using this in one of my 401k-sep holdings for monthly income....so i'm long term also as long as there is a .875 divvy.
"Current or accumulated earnings" which also means accumulated losses. For 10 years I paid no taxes because of a business loss, but it did not mean that I was broke, far from it. What matters is the underlying cause of why distributions were in excess of current of accumulated earnings and profits. Notice, and this is important, that the "core operating income" has NOT been restated. Not making a taxable profit is not the same thing as losing money, just ask anyone who own investment real estate or oil and gas wells.
Thoughts on AI:
1. Core income of $1.50 strongly indicates that the $.875 dividend will be maintained. (The reason AI calculates their "Core Income"/CAD is to give investors an idea of how safe the dividend is).
2. The decline in BV last quarter was largely due to Marking-to-market of their interest rate hedges which lost value as interest rates approached a historic low in the 1st quarter. This will reverse as interest rates have risen substantially since then.
3. Listening to the quarterly CCs and reading AI's SEC filings (10Ks) is where investors should look for information upon which to base their investment decisions.
4. I am a long term income "investor" and not a "trader". As such, I continue to see substantial value in owning AI and as long as they continue to have "Core Income" sufficient to allow them to continue paying the current dividend I will remain an investor
5. Different people have different investment objectives. Figure out what your objectives are and then act in accordance with those objectives. I am a long-term income investor and as such I don't worry as much about the daily/weekly/monthly price movements as much as I concern myself with the quarterly earnings.
from the recent press release:
Under applicable tax law and regulations for C-corporations, distributions to shareholders in excess of current or accumulated earnings and profits should be reported as returns of capital instead of qualified dividends....... In preparing its federal income tax returns for 2014, the Company has now determined that it did not have current or accumulated earnings and profits for the year ended December 31, 2014, and therefore all of the Company's distributions to shareholders in 2014 should have been reported as returns of capital instead of qualified dividends. The Company recommends that shareholders consult with their tax advisor to determine their specific reduction in tax liability from this change.
pretty much tells the same story as you....they are losing money and paying the divi out of equity, ergo...stock goes down. I am out of this at present and will not get back in till I see a Q of trend reversal at least.
In 2011, 2012, 2013 there were significant price drops, each followed by recoveries. Would you explain what caused the 'volatility' then, and how the current situation is either similar or different ?
Santa says hello but couldn't stay and talk,he was on his way to buy AI stock and the Easter Bunny was picking up left over eggs which he said he was bring to your house.
I can see by your response that you don't believe or trust management. The company was founded in 1998 [ 26years ago ] and 33.00% of the shares are held by institutions.
I am sure there are argument for and against owning this stock. I to have been around for a VERY long time and have owned this stock for a very long time and will continue to hold it and add to it when the time is right.
By the way, I do expect the stock to drop in price this week.
If you are a Father, Happy Farthers day to you.
Question: As of this date the total cash is $3.70B and total debt is $3.62 B. The total debt on Jan. 12 ,2015 was $2.78B. Is it possible that the use of capital to pay the dividend has already been figured into the stock price ?
I'm in at $25 for 2k shares. Giving it until next earnings report to see how bad they screwed up the quarter given interest rates increased. I may be seeking greener pastures soon.
There will always be concern about the future. Buy and be concerned that the dividend may get cut. Don't buy and miss a 16%+ return with a very possible rise in share price. Always concern!
I personally put more trust in AI's financials/SEC filings than I do in either historical president or price action of a stock. The current dividend of $.875 is more than covered by last quarters core income of $1.50.
Look at AI's SEC filings. The dividend is more than covered by their "core operating income" of $1.50.