As much as I understand from conversation of you two, one major difference is that Swanger thinks ADK will go (i.e. beome) a REIT while homebuilder believes in ParkCity/Fox that ADK should sell its real estate to REIT for $9/share. I got a few questions to ask. Maybe kind of naive questions, sorry for my ignorance.
1, Swanger once mentioned what ADK has for sale to REIT is too small. What real estate are ParkCity/Fox talking about? Why is it too small? Is $9/share a fair estimate?
2, Why ADK wants to become a REIT? If it does so, how much it would be a fair price (per share)?
3, If ADK sells its real estate to REIT, doesn't it need rent it back for its business running?
And an off-topic but ADK related question. What exactly are the reason ADK misstated in its previous SEC filing? My impression is that the mistake is quite trivial. However why it took them so long to file 2012 Q10? Did they mentioned it why?
Sorry, so many questions. Personally, I'd like to see Park City get a seat in BOD. Based on my previous observation on other stocks, this kind of proposal or actual execution of such proposal usually brings up stock pps.
1, Nonsense. Not too small by any means. The real estate consists of all the owned facilities ADK has. Keep in mind, ADK operates the opposite of every other company in its sector which is why Wall Street shuns them. Their ratio of owned to leased facilities is the opposite of the norm, hence their debt and why WS has no interest. The difference between the $9 and the roughly $4 is for some reason Sabra and Park are using vastly different number of owned beds, 3,500 vs 2,654..
2. ADK does not want to become a REIT. Brogdon is already setting up a REIT at his other public company.
3. Yes, it would be a sale/leaseback which actually makes little sense from a business point of view and would not be done if ADK was a private company but has to be done to appease WS. So ADK would continue to run the facilities it sells, for a short time until it sold the company.
The reason for the mistatements was that ADK was using a two bit small time accounting form that was light years over its head in terms of complexity of transactions. Should have moved to a Big 4 firm a long time ago. It's a big nothing in the grand scheme of things
#1 it is too small yet. Since most of their facilities are leased, where in your opinion is all the locked in value? Who says they must appease Wall Street? #2. I am aware Brogdon owns other nursing facilities and is considering REITing them #3 I agree a sales/lease back makes little sense. So why even give it strong consideration?#4 do you know why both those groups, Park and Sabra are using about 900 beds difference? I do not. #5 Isn't Brogdon and wife still largest shareholders? Personally I had hoped AdCare would have been rolled into Brogdon's holdings or vice versa and then REITed. That would have given this company a much larger base and earnings/upside.
I want to see AdCare remain a stand alone company and pay a small semiannual divy. I have talked to them several times and was happy they did do a 5%stock divy. I had asked for a 3% dividend or 5%stock. I think Brogdon and Gentry are sharp men in this field and I feel or at least felt they had their sights on growing this to a B $ company. I got no reply when mentioning turning this into a REIT several years ago. This is at the start of the big growth spurt. I feel a REIT when it attains a proper size would be a good thing. I bought HCN years ago when it was small and have watched it grow and pay a very nice divy.#2. since last stockholder meeting am unsure of what gives with ADK. Their purchases of nursing facilities i.m.o. were at a good price and will add to earnings. Part of the problems now could be the uncertainty of Obamacare mixed with reimbursement rates for medicare, etc. #3. I may post more later. Homebuilder is certainly entitled to his opinion and perhaps his way would be ok, but I like mine better. But remember, Brogdon and Gentry are in it for the chance to build and/or make $$. Either way, I think we as shareholders will do just fine, thanks
You are an utter moron. I own my home. I don't rent or lease it. I have a mortgage ie debt on my house. I am still an owner dimwit. When I fill out an application and am asked by my address if I own or rent I own! Read the article again. The owned facilities would bring in enough cash to pay all debt and still return $9/share. That's it. I am no longer wasting my time explaining this to a clueless one