Thanks, I tried to look up line 20V on NTI's 2014 K1 but it's not accessible to me under their Partner Data link.
So how did last year turn out for NTI? I also own CVRR and wonder what's on their line 20V?
This is the first MLP I've owned in a IRA. My thinking was it generated income for the IRA and therefore I wasn't responsible for taxes until it was removed.
So did NTI issue a Schedule K to investors last year and how did it effect IRA's?
Anyone have any the basics of taxes figured out here as they relate to retirement accounts?
Cooperman is an interesting character with a big ego. He lectured management about a "colossal misallocation of funds" when they bought back shares at 100 yet failed to note his own stupidity by buying 250,000 between 39 and 47.
So now the question becomes is he smart buy selling those shares around 15?
My thinking is he wasn't so smart the first time and suspect history will show a similar result for his latest actions.
If you look at the earnings estimates for the this quarter, this year and next year you'll see about a 30% decline in the last 30 days....since OCN sold to JPM.
I think the reason for the decline is many believe earnings will take a major hit because even IF OCN survives it will be as a smaller entity. If OCN downsides ASPS has to follow.
The question is how much and how fast the downside occurs?
A few months back management laid out scenarios guiding between around 4 and 8 dollars in earnings this year. They did not amend that in the C.C. a couple weeks back, which indicated to me nothing OCN or HLSS has done so far changed ASPS in a significant way.
But clearly the market disagrees. The risk of OCN and HLSS going BK drove ASPS down from 150 to the low twenty range where it has hovered for a couple months. This recent drop comes with the recent earnings revisions....which IMO is countered to the positive in that with each sale by OCN the odds increase they will survive this mess (and probably start growing again in the not too distant future....someone has to service the sub prime market).
As for day trading and catching a falling knife.....you have to pick Fib. levels if you want to do that. You also have to be prepared to sell each time a bottom is breached....like every day this week.
Personally I have not sold or added since buying in the 21 range. I still see the value, but I've yet to see the bottom. 12.50 looks like a 50% retracement from 25 and 60% retracement from 32 and my guess is if this tanks again tomorrow the next Fib level of significance is a 61% retracement form the 25 range which would put the price eventually around 10.
I would also rather add to my position on the way up rather than on the way down.
Cooperman just bought over 1M worth of shares between 30 and 50 dollars back in the Dec Jan time frame.
My guess is if he sold he just got a margin call...like many others here.
The thing is each sale will lower ASPS earnings, although it will be very slight.
But the big picture is why OCN is selling anything.
It's because they are posturing themselves for survival....not to be sold or close down their door.
So while ASPS may take a small hit on the earnings front, which each sale by OCN the odds increase for their survival.
Which is why I find it so hard to fathom why ASPS continues to get hit with each sale....when I consider it good news since the only reason ASPS is trading at just crazy levels is many think OCN will go away and leave ASPS without 60% of it's revenue.
What's your stop loss on those shares?
Buying a falling knife can pay off big, but you can also lose a few fingers in the process.
in my experience marks a bottom in value businesses.
They came out with the same rating in one of my favorites (CVRR) at 14.
Pretty much marked the bottom in that one.
If they're right we'll trade at 12 in a few months.
If not, probably north of 25.
As usual, I'm following the tale of OCN and HLSS. At moment they are both trading well off their lows while ASPS is trading very near it's low.
One of them is wrong.....
You need to read up on fracking.
New wells are great for the first few minutes.
Within a year oil and gas drops output drops around 50 - 75%.
New wells are expensive. What's being pumped now are the wells already drilled.
Without massive amounts of new wells going up the drop in oil production will come swiftly.
The big question is will cheap money be thrown at the drillers as the price of oil recovers?
My guess is some...but no where near the amounts and price as was previously.
Oil prices rose initially 30% causing an immediate spike in gas prices. But oil prices have fallen just as rapidly as they rose yet gas prices are still hovering near their highs.
Just the way it is.
IMO buying refiners is a no brainer at that moment.
Who else is making all the money.....it's not the oil drillers, suppliers or gas stations.
We'll find out in about 6 weeks as they all start reporting. If I'm right the first one that reports will put the investor world on notice and as usual they'll be late to the party.
I'm OK with that strategy, I use a similar one.....
When a share price drops or rises 5% or more, with the sole reason being an analysts upgrade or downgrade, I play the other side. Normally within a week the share price is right back where it started.
That said, I have no problem buying around 20. My thinking is the distribution this quarter will be around 1 dollar. The last time the distribution moved from .45 to .97 was a year ago and the share price moved from the 20 range to the north of 25 range.
I'm thinking history is going to repeat itself.
I don't pay attention to analysts and I thought everyone else learned that lesson back during the tech bubble They're paid to make money for the firm they work for, not you.
My thinking is the drop in the price of oil today is only going to widen the crack spread as I'm not seeing gas drop in my area.
So my thinking is CVRR should be headed north today, not south.
I bought a few more shares.
Geez, but that is sneaky.
It's also pretty smart.
If they offered a buyout at 25 bucks a share they'd end up with about 1.1M in debt...and a payment of 50M a quarter to service that debt.
Last year they paid around 25M and still generated 200M in free cash flow.
I'd vote no, but how many here would take the 25 and run?
Debt always gives me pause, especially when it's 3X the market cap.
It's one of the reasons the share price is so cheap compared to most value metrics or potential.
That said, the rate is pretty good (4.5%...or around 25M a year) and in spite of paying that they still generated 197M in free cash flow last year.
So, while most of the debt is due in five years they should be able to generate plenty of cash to pay it down...which is what they said they were going to do in the C.C. and should have done with the 400M they spent on their share repurchase the last two years.
Bottom line is still the same...if OCN survives and HLSS gets sold ASPS is a slam dunk here. If they don't the debt will become a factor as the years play out because they won't be able to refinance it without profits to back it up.
"For the year ended December 31, 2014, we generated approximately 60% of our revenue from Ocwen. Additionally, 24% of our 2014 revenue was earned on the portfolios serviced by Ocwen, but is not considered related party revenue because a party other than Ocwen selects..."
OCN's revenue was growing at north of 90%, which is why ASPS was trading for 150 on it's way to 500 before the world stopped with the NY settlement...and also why management had bought nearly 400M worth of stock back the last two years at prices around 100.
ASPS had to spend millions on infrastructure to take advantage of the growth....which is really why earnings took such a hit last quarter.
For 2015 OCN's growth should be flat, but ASPS earnings will reflect just how fast they can cut their expenses to adjust to that new rate.
It shouldn't be that hard, which is why management is thinking they'll make somewhere between 4 and 8 dollars this year.
Last year they generated nearly 200M in free cash flow. Now granted they wasted it on infrastructure growth and buying 250M worth of stock at 100, but even with OCN flat they should generated around that again this year if OCN stays afloat and HLSS gets sold off....which both are looking increasing likely.
The share price is down because it can be manipulated easily because of the low float and the fact day traders are piling on....you have to admit it's been a great short after the last bounce from 16 to 30 played out.
In this range where can you buy a stock that has a reasonable potential to generate free cash flow near it's market cap?
Learn how to read a 10K before yapping.
For the short answer just go to yahoo's cash flow numbers under the balance sheet.
Management thought with the share price being down from 150 to 100 it would be a great time to take out a loan for 200M and buy 250M worth of stock.
Clearly their timing was not the best, but it gives an idea of just how valuable ASPS can be if OCN survives.
HLSS being bought out increased their chances dramatically.
I think many, like you, are expecting a div around .90 cents.
My only guess is whatever the number it will be a 10% payout related to the share price....until more investors get comfortable and then it will move closer to the 6% range.
If it's 90 cents I suspect the share price will hover in the 9 range for at least 6 months.
If it's 70 cents then I'm thinking it will retrace to the 7 range.
Even at that though, I suspect it will move back to the 10 range over the course of time.
You're looking at it wrong. Retail prices effect the spread, not the other way around.
The overall market determines the movement on both ends.
Usually a quick drop in the wholesale number (oil)results in a very slow drop in the retail number (gas).
Usually a quick RISE in the wholesale number results in a very fast rise in the retail number (which is what has happened the last couple months).
So gas prices jumped faster and father than oil.....which caused the spread to enlarge.
Bottom line...unless oil prices tank 50% in the next few weeks refiners are going to report record profits.
By a refiner. Why fight the trend? They are the racking in the money right now.
Just noticed ESV new interest rate (5.75) is two points above the bond they are replacing...yet interest rates are still very near their all time lows.
I think it's smart to do it now to ensure they have the cash to ride this out, but it gives an indication of how all that cheap debt they (and others) have enjoyed for years is coming to an end.
Anyone run the numbers if you double their debt expense?