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Fidelity National Financial, Inc. Message Board

  • kaisersosay20041 kaisersosay20041 May 24, 2005 5:43 PM Flag

    a m best downgrade

    sometimes it is better not to be too smart and measure a stock by results. They are making a big deal about a m best downgrading FNF to EXCELLENT from EXCELLENT and make it sound like the company should be avoided at all costs. Sometimes, looking at what the company has done lately and accept, barring a catastrophe, that there is no reason this shouldn't continue. The stock has inched forward steadily and comfortably, providing the investors with a steady upwards earnings estimate. Furthermore when the company has had success the mgt team has shared it with the investors. I think AM BEST is not the best.

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    • I'm actually investing for total return, but given your criteria you might want to check out AHM-PA and AHM-PB. Neither issue is rated by S&P or Moody's, but aside from that I think they meet all of the criteria you mentioned.

      I own AHM common, and I suspect the lack of ratings is due more to their relatively recent conversion to a REIT in Dec. '03 rather than a particularly high risk of default.

    • Question: If the price of the spinoff stock provides a yield of over 6% would you buy more or what would you look for to make you buy more?

      Answer: I might flip a coin, but more likely I would ask strangers on a message board.

    • If your looking for yield try preferred stocks.
      I am investing in some REIT preferreds. I am looking for:
      cumulative dividends

      investment grade (Baa3 or better)

      coupon over 8%

      yield to next call of:
      4% if the call date is less than 1.5 years
      5% if the call date is between 1.5 and 2.5 years
      6% if the call date is 3-4 years.

      I havent found any meeting this criteria whose call date is greater than 4 years. is the site I use.

      just trying to be helpful.

    • Actually, FRO's already started to move on positive expectations.

      If it's up in Olso, FRO.OL, prior to our open tomorrow, that will be very telling . . . as to upcoming earnings, etc. 31 May.

      Not pumping, just FYI, it will do well enough on its own.

    • I didn't point that out . . . most on FRO board know that . . . still looks positive at normal div expected, plus spin off of SFL.

      Along with crude inventory decrease and driving season upon us . . . IMO, FRO's ready to go . . .

    • You're absolutely right. Although FRO has returned so much value to shareholders that, like FNF, it's indicated dividend doesn't really tell the story.

      I see that S&P says that FRO is yielding 17.3%. Even at that yield the same arguments apply.

      I'm sorry for getting a bit overzealous in my search for the perfect high yield example.

    • the readers of this board should realize that annualizing a special dividend is not a true indication of the divedend rate. FNF does not pay $44.00 in dividends a year unless you annualize the speciai dividend. yahoo has annualized last years payoofs for FRO which included spinoffs, cash in lieu of spinoffs, and unusually high payoffs from record high periods. The 68% number for FRO is no more realistic than a 125% number for FNF which you would get by multiplying by four the ten dollars plus the other dividends paid by FNF last ;year. Yahoo shows a 34% dividend return for FNF which is also wrong, yahoo just compounded the error in its calculation of the FRO dividend
      Just as FNF had its price reduced by the special dividend, FRO has its price reduced by the regular and special dividends and has also had a selloff due to lower tanker rates and thus it is true an expectation that the high dividends will not continue for all of 2005.

    • I meant it more as an illustration that yield stocks can get priced lower than you might expect due to forecasts and fears. I certainly think that's the case with FRO.

      Yep, i agree. No offense taken.

    • donutcar -

      My point was not that FRO is a bad investment. I'm sorry if I implied that.

      My point is that there are fears that it won't be able to sustain earnings, and that's why it trades at such a low price relative to its dividends. My thought is that there'll be a similar issue (although to a much smaller extent) with THC, because there's a lot of fear that the housing market, and thus the title market, has peaked.

      So when I said "the ultimate yield stock" I didn't mean that in a negative way. I meant it more as an illustration that yield stocks can get priced lower than you might expect due to forecasts and fears. I certainly think that's the case with FRO.

      My apologies if that wasn't clear in the original context.

    • "Those REITs have an excellent chance (IMHO) of sustaining at least half their current dividend over the next five years."

      Maybe, but the shares will go down even further if that happens in anticipation of even greater cuts, and --again-- as reits they are mostly non qualified distributions taxable at full income tax rates, state and federal.

      A secure, liquid, tax favored 5ish% yield will find lots of buyers.

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