Not trying to be a jerk, but the statements above do not seem to me to be more specific. They seem to be good lawyer-speak for: We may do something but we may not; we will do what we do for the best intentions of promoting shareholder value, but that may not work out either.
I am still a believer in ACAS though the statements from ACAS here seems vague and aloof.
I am a trader and Investor of ACAS. ;) I am sad about you not caring a rats #$%$ for my trading. ;) I am glad you still like the investor side of me. Since ACAS has got above $12 I have not bought and held any new shares except through my trading process which allows me to retain 5-10% of my trade.
There is only one thing that bothers me about ACAS and I am in complete agreement your statements as I read them. It is hard for me to understand how the spin-offs will occur. ACSF was made into an offering and not as the classical spin-off where a shareholder gets some shares for how many shares they are holding. If the spin-offs are done like this, this will cause some downward pressure on SP, IMHO. I have planned for this contingency so as to reduce risk. But if ACAS would define its method of Spin-off and provide greater clarity it might help ACAS greatly.
Thanks and good luck to you,
I tend to agree with you. We were in a situation after the crash where short money was providing such a incredible spread that for a couple years I felt compelled to purchase these holdings. Right now we are having some spread pressure caused by the liquidity and narrowed spreads. I moved out of REITs last year and found I was a little early to my exit but I think it was a good move.
I do think in the next several years any event that will pressure rates up to drop to cause a situation as good as those magical years. But to find a time to enter and add pressure to SP may come inside the next couple years. (IMHO)
Good luck to you.
The events your are mentioning are accurate but are blended and do not correctly represent the problem of 2008. The dividend was secure and was paid. They had two problems and both have a tie. This is from my recollection.
Problem 1: CDO holding. They had a large amount of CDOs. They like many people saw them as failing. I don't know how many CDS's they purchased but it did not change the M2M issue that while they held CDO the equity underlying the paper they held was not worth what it was sold to them as. The CDOs and CDSs failed them and they lost greatly thus reducing their real NAV.
Problem 2: M2M materially and dynamically reduced the value of their portfolio, thus reducing their real NAV.
So unless you are saying: we are in a cascading deflationary economic environment, it is hard to believe your statement today and these times are not in anyway equal.
If you do not like ACAS for some other reason or situation I would enjoy learning from you. Certainly if the "Whole market dumps" ACAS could be back to $3. GE, Goldman Sachs, and many others will have issues as well. That is like saying if your house burns down you will not like the bedroom furniture, true but I will have a large amount of other problems too.
I went outside and it was snowing. So I ran in fired up my new weather service and I called for Snow in my area. As a weather forecast I always get it right.
I think I am going to apply as a Zack's Analyst job. I would like you all to help me with my first in what I would call brilliant Stock Analyst. Here I go:
ACAS I predict will do poorer than originally thought for the fourth quarter of 2013. I would sell before it goes down below 15.50. Oh yeah I predict it will snow somewhere and sunny sky's can be found in areas without cloud cover.
Many of you are upset and probably rightfully so. So I apologize for my tone. Yet I have to say I love this. I thought a large pullback would take place and it did. Now I have to say I do not believe ACAS should be the center of anyone's world except those that work there. What I am saying is if as investment you only have ACAS I think you may get hurt.
So from my seat I ask several question is ACAS viable. I say Yes. Can it yield either in stock price or dividend? I say Yes.
I think that AGNC and MTGE needed to be reflected in ACAS better. Because they are seen as management fees the state of AGNC and MTGE and their poor performance was not being reflected as quickly as would have. I think AGNC and MTGE still have at least another year of issues. So AGNC and MTGE in my mind will not contribute to ACAS and therefore be a drag for a while. ACSF though should be helpful to ACAS and should help lift ACAS for awhile. Unfortunately it has was not a large enough contributor inside Q4.
I am not sure ACAS is going to be what many want it to be. Will it Re-RIC? No one really knows (Malon probably knows), I just don't think so. I think they will spin off a business as a RIC and get associated fees. I am holding ACAS at this time because I think it will at sometime go private and give me a good return. I at one time thought shareholders would get spin-off shares but I am unsure of that now. I liked the old ACAS but I do not think they are trying to return to the old ACAS.
Just my thoughts,
Good luck to all.
I can from my seat see what you say and see there to be a large amount of truth. I keep hoping to see greater turns. They must see that they can glean the value later. If it was me I would have moved to take the hits and move forward.
I was expecting something like this. I am kind of shocked that NAV is this much lower. I have expected a D-Day(Decrease Day) as pertaining AGNC and MTGE and I suppose this is a response to that. It will be interesting to see how low does it go? Stockholders behavior is hard to understand. If pre-markets are an indication we may have a good buying opportunity soon. I will hold my feelings on AGNC and MTGE until my understanding of Yellen start a gellen.
I hope you are right. I think things will be mixed to poor. I think, issues are conspiring against ACAS. I think NAV will be roughly flat +-.20. My bet is earnings will be on the low side .20-.23. I do not see a near term reason to move lower so for short-term players I would hold right now.
I HOPE YOU ARE RIGHT AND NOT ME. I AM pessimistic across the market right now. There is nothing stock wise that excites me right now even with the correction we just had. (ACSF being a possible exception).
I read that article and felt like you. But as time went on I thought: Every quarter to me has seemed too important. And it is important don't get me wrong. But I suspect hard times coming for ACAS. At this level there is a lot less excitement. When it was at $2 I thought any more bad news would run this company out. The economy is not hitting on all cylinders and ACAS will pay a price for that. Competition is high and ACAS will pay a price for that. ACAS is low on debt and it is here where I think ACAS has some edge.
I believe ACAS will do well although this and the next several quarters may not show it. There may be a very good buying opportunity coming.
NMB, Are you saying Mark to Market is not valid on share buy backs (I do not believe this to be true)? Your previous post uses the assumption we have shareholders willing their shares to ACAS at their death so ACAS gets it at 0; that I would doubt happens very often if ever. If I take Cash(Asset) and Buy Stock(Asset) the only way I can get assume more(Asset) for my stocks value is: 1. Not assume market value, assume some other higher valuation. 2. Stock Price Went Up. ACAS is a company and their valuations on paper are not allowed to be published by the second so they as almost all companies do pick a date and say this is when we a valuing our stock assets from the market. But you are saying there is a mechanism that transforms the valuations as you buy them.
Now you may say they are taking shares off the market. But they are also reducing their cash (ASSET).
If you have an explanation that does not include random people dying and send gifts of shares to ACAS I am excited to hear it. I would like to understand.
You are my favorite writer. So I do not want to seem disrespectful.
MY UNDERSTANDING IS: Share buybacks work on increasing NAV as PPS increase. Share buybacks are not share-will-my-stock-back to ACAS so they get it free. Companies do share buybacks to reduce the pool of investors which general reduces speculators and as time goes by leaves more long minded shareholders thus causing share prices higher. As the share price goes higher the company has an asset purchased at a lower price and NAV goes up.
Therefore the Paradox I was asking to knhup to explain was his statement that "In fact, without the Q3 share buyback, NAV would have declined in Q3." How do you buy something in a quarter and it rise in value whereas it did not reasonably rise in the quarter. To me the previous quarters acquisitions have been more beneficial to NAV because they have seen better appreciation over time. I have not heard a reasonable explanation of this so called FACT and I have heard people make this representation before. So I wished an explanation.
Thanks to all for the thumbs down. :)
I think you misunderstood. I understood knhup was saying share buy backs on their face raised NAV. Even buying at 70% of fair value will not work if the expressed opinion of the shares are negative and the share price drops further. The share buy back is useful when there is true valuation and/or shareholders who see value in excess of it current share price.
I think the ACAS share buyback is good and good for long share holders. I LOVE ACAS!
A buyback does not inside the same quarter make things all that much better and the money for the buy back has just shifted from cash to shares. The value of a buy back is made mostly over time. The share price has to rise for the buy back to truly benefit the company. Just saying it is at 70% fair value does not in itself mean that the SP will go up and you get what you want.
I am just saying last quarter was not all that bad and it is not the share buy backs on their own that are helping ACAS. ACAS is helping themselves via many things.
You will have to explain this Paradox to me. "Without the share buyback NAV would have declined." Although the share buyback may have meant some instant benefits they did not buy at $10 and it(the share price) ran to $30. I keep hearing the buyback on its own raises NAV. That cannot be true. If I had a company that has $1000 and a hundred shares(NAV is at $10). And I bought with my $1000 ten shares at $10. I would have $900 and 90 shares available(NAV $10). I cannot buy shares with good looks. So pretending the buybacks raise the NAV is pretending they did not buy the shares they stole them. Just my thoughts.
I cannot imagine you got a thumbs down. It might have been me who did it; I was about to click the thumbs up and my dog came in and nudged me with its nose. My dog demands belly rubs. I left the computer and returned this morning. Merry Christmas to you .
To everyone else, Merry Christmas and Happy New Year.
Good luck to all. Most people on this board do a very good job staying on target and leave anger aside. It is a pleasure to share ideas about ACAS here.
I have never gauged the floor correctly with ACAS. I have done well grabbing shares on a run up quite a few times and making a nice trade out of the run. I suppose if it got down to 13.50 I would probably join you in buying some more.
Maybe I am not as smart as you. You said: "Otherwise, given the company's sluggish operating performance, and it's declining NAV (absent it's stock buybacks)" Huh... if they hung on to the cash instead of a buyback NAV I would think would be mostly the same state. The only thing that I know that would react poor on NAV is purchases in equity or or operations that under-performed. If I bought a $100 of gold I cannot legitimately conclude it is now worth $150 or $50. They are getting some performance with buy backs but not enough to conclude they are faking out real NAV with overwhelming increases. NAV and SP have been at 30-35% of each other for over a year. They are not closing a gap as to say there is an appreciation much greater than real. So I conclude NAV increases are currently really NAV increases.
You are making a statement that purchasing their own stock is greater value than its own value, I do not see it like that. You will have to make me understand that there is greater appreciation in ACAS stock than I see.
Maybe I am missing something.