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Forestar Group Inc. Message Board

  • layahillary layahillary Apr 30, 2009 10:00 PM Flag

    Forestar is a weird bird

    This one is straight out of Dr Seuss.
    I can see where it would be worth $15 per share to Holland Ware. I'm sure he knows exactly what it would be worth to him.

    Now how in the He77 is an individual investor supposed to value this thing with no dividend or royalty stream. It's like a royalty trust with no royalty's a Reit with no rents, Forest Products Company with no manufacturing.

    Seriously, what peers group has this thing mirrored? I am interested in learning more about their model. I see the P/E is currently at 35! I imagine its because of no E.

    Maybe their biggest money making potential is carbon credits or some such tripe.

    I don't get it. Somebody clue me in. My gut tells me this thing may be a good long term investment but I don't know why.

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    • Just your standard development company not levered much compared to your average development company...LAND SPECULATION...VALUE ADD TO TIMBER HOLDINGS...AKA DEVELOPMENT...

      Has cash flow from fiber/timber and minerals to fund the development costs...aka soft costs...pursuit costs...etc...

      Obviously all three business segments are in the tank...Compared to the last couple years...

      I agree...Don't really understand the run up from $7-8...Guess market felt it is undervalued...FOR holdings are fantastic for the next growth cycle in ATL(when is that???), but I cannot see through the trees yet...Good hedge against inevitable inflation with OBAMANATION...TREES, DIRT, and OIL...Can't think of a better place to hedge...At what price? I think the market still has a reality check coming. Hold on! Commercial Mortgage Backed Securities coming due over the next three years are something like $819B...

      Obama's over reaching into the private sector and his left agenda has a chance to really stifle the private sector and growth for a while in the USA or should I say the south...Guess the business folks in the NE and West Coast like the guy??? So, yes a wierd bird...Just bird watching right now on FOR...Less strange birds elsewhere...Finally, trading around book value...Obviously with timberlands the liquidation or intrisic value should be greater than book/historical cost...Since they probably have land for $10 an acre on the books. Maybe that was the reason for the run up? Still bird watching on this one as their earnings in FY10 should be aweful and in the red unless they just chopped a bunch of trees for weak prices to stay out of the red and as long as OIL stays below $50.

      • 1 Reply to tightlinesnfreshtracks
      • It had a nice run from 7 or 8, but I sold about a week ago for a nice profit. I'd be a little concerned about earnings this quarter since I don't see how they can be good. I'm a little surprised it's gone this high this fast, but I wouldn't mind getting back in if there is a sufficient drop after earnings are reported. I'm hoping for a pullback, but this is a pretty powerful market right now, and I am surprised that they followed through with the timberland sale. We'll see.

13.52-0.30(-2.17%)Nov 27 1:02 PMEST