Thanks for posting the link to the article. It was very informative and even a bit scary. There is, however, a bit more security to what PZN is doing than the writer apparently understood. In a past conference call, analyst, Jennifer Childes, asked Doc whether States can prevent the transport and incarceration of out-of-state prisoners. Doc's reply?
No. The company is involved in interstate commerce protected by the U.S. Constitution. States cannot impede interstate commerce.
It's kinda scary that the folks in California don't know this yet.
With a current stock price of $19.50 and earnings of $2.28 PZN has a P/E ratio of 8.5 based on trailing earnings (FFO). Next year's earnings are estimated to be somewhere around $2.60 which represents around 15% growth over this past year. In my humble opinion PZN is undervalued at its current stock price. If FFO continue to grow at a 15% annual rate over the next few years, then the FFO should be around $3 in two years which would justify a stock price of about $45 per share in two years (15 X 3 = $45). (Back in the fall, before the merger, Value Line had two very positive analysis reports (9/98 & 12/98) on CCA, its prospects, and its upcoming merger. Value Line believed that the merger was a very positive move with a number of financial advantages to the company as well as to investors who were willing to be patient.
For providing some good info re PZN. Flipper could you provide more details on Hong Kong Shanghi Bank purchase of stock each month. Is this new stock from PZN and who sets purchase price? Are they driving price down so they can get shares cheap?
Other Reits are selling for 10-13% yield and go down as interest rates go up is this is why price is weak?
Is there any tax advantage or disadvantage in owning a REIT in an IRA?