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PICO Holdings, Inc. (PICO) Message Board

  • sixfoot_flat sixfoot_flat Aug 11, 2008 1:45 PM Flag

    Price

    I don't get it! Why people are selling low at this time! Stupid! It makes me think of price manipulations.

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    • I have been watching PICO for a few years and always thought it was a little expensive. I am getting my portfolio ready for the inflation that is inevitable in a year or so. This company is chock a block full of assets. I particularly like the fact that they are buying developed lots around Fresno. We will make 2-3 times on them. The water rights just sit around and appreciate. The west is getting dryer each year and the price for which they are now selling water will double in 5 years. They are good investors so the insurance sub float will head up with the market when it turns--it is like having a free money manager--like berkshire hathaway. What is nice is that they think inflation will come roaring back also and will position the company appropriately.

      • 1 Reply to sage533
      • Berkshire is selling for 1.6 times book value and Buffet trys to grow BV by 10% a year--not his year however. PICO's BV is understated because a lot of the assets are at historical cost. They note this is the press release. We will work our way back up to 1.5 times BV of $26 but BV will be 15% higher at this time next year because of mark to market of securities. This is a super conservative asset play.

    • It is becoming more evident with the drought in the Southwest that PICO's other water holdings are dramatically increasing in value. It won't be "new development" looking to obtain this water... it will be long established communities.
      Has anymore seen Lake Mead lately??? It is a shocking site to see. Here's a link to Vidler's other projects:
      http://www.vidlerwater.com/html/project_portfolio.html

    • Read their 10Q and 10K. Their earnings reports include book value/shareholders' equity. Some of their assets are carried at cost and some at fair market value.

    • FDAPHOPE -

      Seems like you have a better understanding of the company than I do. How do you value the rest of the company? I believe you quoted a $27 share price.

      I bought a couple shares to keep it on my radar - seems like a very interesting company. However - I will not invest until I feel I am getting a bargain. I am not there yet - but what appreciate your analysis (and others).

    • Once the water rights are sold the buyer has the right to the continuing use. Washoe County is now responsible for delivering water and maintaining the infrastructure that Vidler built.

      I assume the aquifer will be closely monitored and the 8000 is pretty conservative. In fact, if the aquifer responds appropriately, Vidler could apply to sell more water from Fish Springs in the future.

    • I believe something is not very clear on this 8000AF. It is my understanding that this is a continuing supply of 8000AF per year and not a one shot deal. Is it being assumed that the demand will stop after the 8000AF is sold? and also the Aquifer will be dried up?

    • The question is why is anyone paying 47 for a stock worth 27 and change. Even if they sold all of the water from Fish Springs tomorrow (as opposed to the 120 acre feet they will close on this quarter), the stock would still be grossly overvalued.

 
PICO
21.94-0.12(-0.54%)12:06 PMEDT

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