"substantially due to a reduction in projected management fees from the two mortgage REITs that it manages"
I remember a number of people mentioning that the decrease in NAV doesn't affect fee income from ACAM? So why this now?
Anyway, only two more days to see if valueseeker is right about the SP being 14-15 in a couple of days!
Could go either way tomorrow. AH trading on this issue is so thin. 20K shares up, 2K down. But so what? Tomorrow will tell. Not feeling confident enough to buy any more in AH, but will go out for a nice sushi dinner now...
Sentiment: Strong Buy
This is the part I like...
"American Capital experienced a soft second quarter, due in part to depreciation in American Capital's investment in American Capital Asset Management, or ACAM, substantially due to a reduction in projected management fees from the two mortgage REITs that it manages," said Malon Wilkus, Chairman and Chief Executive Officer. "Nonetheless, we continue our focus on growth of our book value with the result that we were able to produce $21 million of earnings and increase NAV per share by $0.24 to $19.28, a 16% increase over the past year."
Yeah, it's exhilarating to see that the MM's are bidding up the Ask in AH, but I'm a realist. No one is really going to take the bait with these numbers from ACAS. Tomorrow's CC could be the answer to everyone's prayers. That's if they announce a restructuring.
The company is trading at a high discount to NAV because of operational difficulties compared to other BDCs. Both the discount AND operational improvement are necessary for good value.
Maybe if John Paulson were to get and earth-mover onto the board.
second Quarter Earnings Announcement Expected: ACAS has confirmed that earnings will be announced Tuesday. The consensus earnings are $0.25, with a high and low of $0.28 and $0.19, respectively. The mean has not changed significantly as the end of the quarter nears.