Today's talk has given 6 reasons for the slump in PZN:
Macro: REITs are out of favor small/mid-cap groups are underperforming the market and failing to attract capital to their issues
Specific: Bad press Ambiguity about the future of privatization Confusion/dissatisfaction of stockholders about the changeover Possible IRS review of the REIT status
That's quite a slew of reasons. I'm looking for a bottom and will perhaps double my position. Yield of 13.38% (without the special dividends or any regular dividend growth) and moving in the direction of (and ever closer to) it's 52-week low while showing good fundamentals - isn't this a VALUE play?
I do remember Doc said $50 by year-end 99 and I wonder.
If this stock is going to pay a special dividend in December of ~$2, the price is going to drop at LEAST $2 immediately thereafter.
In reality, stocks drop MORE after the ex-dividend date as shareholders hold for the dividend (or bought for the dividend) and dump. There is a highly predictable price decline coming in December.
AND where does the money for this dividend come from? If this company has to borrow or issue equity to pay that dividend, then we are left with an entity with higher leverage or dilution and thus it may be less attractive thereafter.
These uncertainties are abhorent to the market. And they appear fully justified.
I suspect if PZN pays a $4.50 dividend this year as estimated previously on this board, the price will be $10 thereafter, when all the fundamentals decline. To overcome these disadvantages, the company would have to show a significant earnings improvement.
Tonight (Friday night) on "Wall Street Week" with Louis Rukeyser the topic for this week is scheduled to be "The Real Estate Scene" which, I am assuming refers to REITs.
www.multexinvestor.com is a website where investors can download analyst's reports on any stock for a fee. The fees can range from $5 (Standard & Poor's 5-page report) to $75. Most of the reports that are available cost $10 - $20. I would highly recommend this website. I've learned a great deal about the prospects for PZN by downloading a few of these reports - I now feel I have a much better understanding of both the positives and negatives (risks) of PZN from reading some of these reports. I found the Standard & Poor's report ($5) to be very informative and also found a report by Wheat First Union ($10) which was dated 1/19/99 to be quite informative as well......these reports lay out the positive possibilities of PZN as well as the risks associated with owning the stock....solid information provided.....