I picked up some shares the other day after reading everything I could find on SFL website. Looks like a good deal to me - 8% yield, some moderate growth potential, possibility of cap gains.
If they make a decent amount from the profit share, if they're smart, they'll use it to either expand, or pay down debt (buy back more 8 1/2% bonds due 2013). This way they'll be able to increase the regular dividend (and therefore share price) significantly.
Management has repeated numerous times they want to keep the dividend steady, which means that special div is not likely. I know, they said if they were sitting on a pile of cash and didn't know what to do with it, they could have a special and return it, but they DO know what to do with it - buy back more of the high yield debt they have out there.
What do all of you think people will pay for this company by 6 months? I know it's worth at least 17 but I guess we'll have to see how the market values it once more people learn about it. I'm hoping for low 20's.
<< I have no problem with JF's decisions. I just laugh at the posters who want to pay down debt vs. give the shareholders a direct return. >>
Yet, unless SFL has gone rogue, the paydown was at JF's direction.
It seems you're saying that supporting his decision is foolish, but you have no problem with the decision itself. Odd, that.
mississipibluffs, I have no problem with JF's decisions. I just laugh at the posters who want to pay down debt vs. give the shareholders a direct return. That's been my message...
Another level? whatever that means.
I personally have no position on the issue you're so concerned with. Fredriksen's track record with FRO has persuaded me that his management of FRO, SFL and the forthcoming dry bulk enterprise will continue to further the interests of shareholders. Particularly since he holds so much of the stock himself.
mississipibluffs, fully agree. I just disagree with the other posters that banks should get preference over a windfall distribution. It is purely a board discussion, your effort to elevate it to another level should be shouldered by your own muscles, wherever they may be placed.
pdn, there were *lots* of big words in that excerpt, and on top of that, your post was truncated. So I attempted to find the "Covenants" section of the F4, and was unable to find the section you quoted.
In any case, based on what you have posted here, it almost appears as if SFL would have been prevented from paying a dividend *at all* had that $25 million buyback not happened.
Am I off base in that thinking?
Now you don't even bother to argue your point on the merits any more. You have resorted only to claiming that I don't know what I am talking about, even after I quoted you language from the F4 under the section "Convenants". Some people won't see what is right in front of their eyes, but here goes...this is from Exhibit 4.4 of the same filing. I uses alot of big words that you probably won't understand but it is called a convenant and it restricts SFL ability to make certain payments based on financial and credit ratios.
These things really exist and if you didn't think like a 12 year old, you could endeavor to find them and read them and understand them...which would lead to calm the heck down of the silly $25 MM note buyback.
(a) if the Consolidated Coverage Ratio for the Company and its Restricted Subsidiaries is at least 1.75 to 1.0, such Restricted Payment, together with the aggregate amount of all other Restricted Payments made by the Company and its Restricted Subsidiaries with respect to the fiscal quarter for which such Restricted Payment is made, is less than Available Surplus Cash with respect to the immediately preceding fiscal quarter, provided that the Company will not pay or declare any extraordinary or one-time dividends on its Capital Stock (�extraordinary or one-time dividends� meaning for such purpose dividends in excess of amounts stated in the Company�s regular Capital Stock dividend policy as determined from time to time by the Company�s Board of Directors); or
(b) if the Consolidated Coverage Ratio for the Company and its Restricted Subsidiaries is less than 1.75 to 1.00, such Restricted Payment, together with the aggregate amount of all other Restricted Payments made by the Company and its Restricted Subsidiaries with respect to the quarter for which such Restricted Payment is made (such Restricted Payments for purposes of this clause (b) meaning only distributions on Common Stock of the Company), is less than $25.0 million less the aggregate amount of all Restricted Payments made by the Company and its Restricted Subsidiaries pursuant to this clause (b) during the
P.T. Barnum's famous motto, as I recall, was "There's a sucker born every minute."
A suggestive choice for a pseudonym.
Whatever your motives, I am surprised you haven't realized yet that management decisions for Ship Finance International, Ltd., are made by management, not by posters on this board, whatever personal notions of equity and/or sound business practice they may hold.
You might have more effect by addressing your remarks to those who are in a position to revise the policies you disagree with
Surely by this time no one reading this board fails to understand your views. You have made them quite clear. I suggest you consider one of life's dismal truths, to wit, not everyone will always agree with you.
poondog1999, I do believe that GE puts the results of their GE Capital division under their 'finance' business reports. Do you have a problem with GE presenting their leasing operations as a financial enterprise? Most people, with some knowledge of business, are comfortable with that label. Why aren't you? Less debt is always a good thing, but it should be balanced with providing the shareholders the rewards they deserve, FIRST, and foremost. The debt of SFL is not onerous and is 'young' and within the business plan. Shareolders deserve the full windfall the marketplace has given SFL management.