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The St. Joe Company Message Board

  • chicagoish chicagoish Mar 3, 2011 12:35 PM Flag

    Morningstar keeps Fair Value @40

    Some Notes
    Importantly, the quarter exhibited no major downside surprises. Real estate-related impairments of roughly $8 million align with the magnitude of charges taken by many of the firm's peers of late. And given the recently announced Securities and Exchange Commission inquiry into the firm's accounting practices, we believe St. Joe and its auditors deeply scrutinized the carrying amounts of real estate on the books. This resulting rather benign adjustment should provide shareholders with incremental comfort that no major misstatements exist in the firm's financial statements. This modest charge may also provide a catalyst for further short covering among those that have launched barbs related to the firm's recordkeeping and lack of impairments.

    With this report disseminated, we now await many Fairholme-initiated changes to the firm's strategy and operations in the coming months and quarters. While we expect many positive developments from the firm's new board leadership, we will closely monitor proposed adjustments for any potential creep away from St. Joe's core operations involving development of its large master planned communities and commercial acreage surrounding the new airport.

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