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Linn Energy, LLC Message Board

birdluck1 4 posts  |  Last Activity: Jun 19, 2015 3:46 PM Member since: Oct 7, 2005
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  • Reply to

    7.875% dividend at $19 per share

    by beepeeess May 21, 2015 10:49 AM
    birdluck1 birdluck1 Jun 19, 2015 3:46 PM Flag

    The board cannot make alll of the money. If you read the prospectus, you will see that all of the managment is paid only in stock that does not vest for 8 years! This ensures good alignment of the interest of managment and shareholders.

  • Reply to

    7.875% dividend at $19 per share

    by beepeeess May 21, 2015 10:49 AM
    birdluck1 birdluck1 Jun 19, 2015 1:48 PM Flag

    From the press release:
    "Community Healthcare is a newly formed REIT with no revenue and will use the proceeds from the offering to buy its initial 35 properties. The anticipated rental income from the properties for the first year is expected to be $14.0 million, representing base rent, operating cost reimbursements, and straight-line rent under the lease terms. Operating expenses include taxes, assessments, water and sewer, and are projected to be $2.40 million. The company will account for these straight-line depreciation method over a 30 year period. General and administration expenses should approximate to $380,000.

    The cost of the initial properties is $114.5 million, allocated to land, building, and intangibles based on the fair value located in 18 states."

    After purchasing the initial properties, they will be paying out 96.5% of available cash to cover the dividend. They will have 13 million extra proceeds to start buying more properties, and no debt. This looks like a great start to me. Compare that to DOC which is in the same business, but in urban areas, and still does not quite cover the dividend after nearly two years of growth. DOC is expected to cover the dividend when it reaches 2 billion in size and then will add debt and be able to raise the dividend using leverage to raise the cash flow. I expect CHCT will follow the same plan and will not raise the dividend for two or three years. When they finally add debt, they can raise it fast.

  • Reply to

    BRG

    by birdluck1 Oct 3, 2014 5:09 PM
    birdluck1 birdluck1 May 22, 2015 12:25 PM Flag

    Ethison: When I. Suggested buying. BRG in Oct 2014, you asked if the cash flow. Covered the dividend. I replied that it did not but was projected to do so early in 2015. They are now within a few cents of covering and project doing so next quarter. The execution of deals has been excellent, and I now have as much confidence in BRG as I do in IRT and APTS. They just completed a large follow on offering with no loss of share price. Yield is 8.5%.

  • How can the aquisition of TSRE which has yield of 5.5% be accretive to IRT with yield of around 8%? TSRE already has substantial debt, so adding leverage cannot be the answer. The only possibilty seems to be that TSRE is internally managed and IRT will drop RAS as external manager. If this is true, then how will that effect RAS CAD?

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