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National Retail Properties, Inc. Message Board

  • marvin339 marvin339 Feb 27, 2008 12:55 PM Flag

    RIDICULOUS

    is the market reaction to NNN selling $200 million convertible senior notes due 2028. In 2002, I bought my first NNN shares, and the company had less than 500 investment properties. By using debt, the company can now boast owning 908 investment properties. DEBT IS NOT A BAD THING.

    "The exact timing and terms of the offering will depend on market conditions and other factors" [copied]. Management will get the best terms that will benefit shareholders. I believe this new money will be used to pay off higher interest debt, and, according to the news release, any balance will be used for expansion. There is nothing wrong with that strategy, and with growth will come higher dividends.

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    • Whether it is "ridiculous" or not depends on how the company performs in the future. For now, as these are convertible securities, Mr. Market is today saying that your (and my)ownership position in NNN has effectively been diluted by this news.

      • 2 Replies to farmlegend
      • farmlegend: Perhaps we are reading two different news releases. You believe our ownership has EFFECTIVELY BEEN DILUTED. At this point in time, there hasn't been any dilution, and there may never be a dilution. It depends on how the company redeems the notes. The notes are "convertible into cash, and at the company's option, cash, common stock or a combination thereof". The negative perception that exists in today's market has happened several times in the past, but the stock price has always recovered. A good buying opportunity exists. With today's decline and a dividend increase expected, the yield has become more attractive.

      • This has happened before and we always come back. I see no reason to believe this is just a temporary dip which I am going to use to buy more shares. I have owned this stock for a long time and they always deliver.

 
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