The stock has been in a trading range for the past 18 months - roughly $20-$30 ( a little higher and a little lower at peaks/troughs). Whether its a legit price is up for debate, but the reality is, that appears to be the trading range for now. Absent a catalyst that makes it very clear that either the shorts or the longs are "right", one could assume that this will continue to be the case. Just one way to look at it. Different investment styles might approach it in other ways.
I think the numbers are okay. I took a quick look at the year over year operating data that sdt993 talked about (decreases in operating margins when you remove gains on sales), and I agree with his numbers for Q4 '01 versus Q4 '00. I also looked at full year 2001 versus full year 2000, and it was slightly better, but still negative.
However, I would point out a couple of things. First of all, if you remove the start-up losses and D&A from the numbers as well, it doesn't look quite as bad. I think that's the right way to do it if you are going to ignore gains on sales.
I think the main point about this issue, though, is that they have been ramping up the sale/manage-back program over this period, thus they have been removing the higher returning properties into the JV's, and making the mix more focused on the not-as-stable properties. I think the real proof will be going forward -- the program should be pretty much ramped up now, and if 2002 versus 2001 shows such weakness, it will be more relevant, IMO.
I am encouraged by the additional disclosure and explanation, but was annoyed at Klaassen cutting off the call (as he usually does) at an hour, after only a few questions. I just don't understand how he can be so clueless in terms of investor relations.
I continue to believe that the company is strong, and that the sale/manage-back program is a good idea and will prove to be profitable going forward. The way I see it, they are basically building up an inventory of these 20-25% interests that will start to yield significant positive contributions to income as the properties just become more profitable with inflation, if nothing else, going forward. You will see that happening (or not) through increasingly positive (or not) quarterly numbers in the income from unconsolidated ventures line. Only problem is, that is mixed up with development JV results as well. Additionally, as Klaassen stated, these JV interests are on the books at a very low book value.
A complicated company to analyze, which is why smart people have massively different views on this one. Time will eventually tell, I think, but it could be a few years.
I remain on the positive side. I am a Strong Buy below 25, a Buy up to 30, a Hold over 30, and a Sell at 35.
I will echo the previous compliment to MrJoe. Good post - thoughtfully done. Smart and reasonable people can disagree. In fact, looking at your price targets, I think we actually agree more than we disagree, on the stock at least. The financials are another story ;)