Yes, and the rest of the world is blind to this fact I am afraid. It is nice if you are a long term investor, but those short term traders are moving this stock right now.
I am not saying buy it all right now - This company is worth more than the stock price indicates - Looking at it from a valuation perspective, cash flow is king and with Triple Net Leases the consistent earnings power is extremely positive.
My biggest concern is the expense related to initial renovations and turnover renovations. If management is right, these expenses should taper off as the portfolio matures.
My belief is that the company should internalize the management portion of the business in order to limit expenses in most markets.
At such a steep discount to book value and estimated NAV, the reality is we are buying houses on the cheap and reaping the eventual income for the rental portion of the houses. If you back out depreciation expenses, the loss is much smaller this quarter. I believe we will make headway as the percentage goes from 81% leased in aggregate to about 85-90% leased.
To me this is the only time I would be a buyer, when everyone else is not...
Yes, I believe consumers drive less because of the price. I have been driving more since the prices have gone down... It is called consumer behavior.
But that is not how it is going to be played out in the market. Management will be the key here. If they offer positive comments on the RIN costs and future MLP/capex then watch the shorts...
The problem is we are now looking to Q4 as Q3 is over. WTI/Brent spreads have grown and volatility for RINs is high. The average price of a RIN so far in Q4 is around 50 cents, from what I have gathered. If the cost of RINs continues to drop, that means the cost outlay predicted for Valero will shrink dramatically. Valero was budgeting 800 million in RIN costs for THIS year.
AH, The MM's are playing with PBF investors - There is a massive amount of shorts still attempting to get out and they are trying to flush the weak hands at the moment. Such rapid movements up and down... With the BRENT/WTI spread and lower RIN prices this is making it a very interesting investment after it was beaten down from the $30's.
There is a huge crude oil supply which will be bursting at the seams if production levels continue to rise. With Canada exporting their bitumen to refiners in the USA we will have an oversupply of crude, which will drive our imports down and provide refiners with lower cost feedstock. I don't understand why people can't see the truth... It is staring us in the face. The refiners have a great opportunity.
That should have been Maya crude vs. Mars.
RIN prices went below 50 cents this week. This should make things more interesting for PBF, which has been taken to the cleaners with the cost of RINs.
I still believe PBF is a viable entity that has a lot of potential with its assets on the East Coast. They are the only heavy crude producer out on the EC, and with the price of Mars crude dropping in relation to Brent, this will benefit PBF. Also, the WCS price differential to WTI is now over $31, which means the differential to Brent is now about $37. This is extremely positive for PBF.
As cheaper crude is sourced and the deal with J. Aron is put into action, I believe the positives outweigh the negatives. Also, we have an MLP coming in 2014.
One other thing that will benefit PBF is the chemical business. PSX has a diversified business with chemicals, refining and midstream. I believe PBF has the potential to grow its diversification and the leadership to make it happen.
Averaging down is a tool that great investors can use.
I think of Warren Buffett as one of the greatest averaging-down investors. I am doing it myself, and over time the accumulated shares with dividend returns will put me in a position where I want to be.