You mean the $1.58 dividend? The one that is just the start of between $5.50 and $6.50 in cash distributions for the year? That one? Yeah, I got one too. That is SWEEEETTTT!
You are absolutely correct and the market is behaving accordingly. What the market refuses to understand is that this offering does nothing to change the outstanding shares juts a lessening of majority holdings. The company's economic model is unaffected in terms of all of the economic indicators like EPS, P/E, etc.
Please read my prior post. It has to do with taking profits before the initial IPO waiting period is over. It is not the best way to do it for those of us in the minority holdings but it is "legal" for the insiders to take advantage of profit-taking.
The market is currently looking at the two stocks and have determined that it is better to be an owner than it is to be a subsidiary. What the market does not or will not understand right now is that CVRR continues to pump out the cash distributions. For example, I looked at figures from two years ago and figured out that even with a down year in profits compared to last and this FY we would still be getting an approximate $3.50-3.90 cash distribution based on management's cash distribution formula. That is still over 10% return even in a year that showed closer crack spreads. No, I see that Icahn Holdings wants to by 2,000,000 shares from CVI Refining Holdings, LLP and I am convinced Carl Icahn is a smarter investor than I. I'm just going to keep on moving along with CVRR and wait for the market to correct toward a share price increase.
Sorry to disagree but you need to read the whole prospectus at the SEC. Icahn is doing a private purchase of 2,000,000 shares with CVI Refining Holding. The total amount of shares issued stands at 12,000,000 plus 1,800,000 if all the underwriters excercise their options. Total amount of shares is still 13.8 million public offering. Still, sweet for Carl.
The offering is being placed in a change for the group holding the shares with CVR Holdings, LLP. The group will be losing its majority control from 81% down to the 70's% majority. So the majority holders will be exchanging shares priced at $25 initial offering for shares offered at $30.75. Wow, $5.75 profit and another $1.58 a share. The thing is, the offering at $30.75 will be realized. In addition Icahn Holdings will be offered 2,000,000 shares of the 13.8 million total reducing the public's ability to purchase from 13.8 to 11.8. Also, the underwriters can excercise a purchase of 1.8 million shares. Therefore, the 13.8 million shares offered to the public now goes down to just 10 million shares. This is a golden opportunity to buy shares at a discounted price before the 2nd quarter results are reported in July (?).
Good questions Mad. The answer yes they have for this FY and second question: last quarter this year possibly but more probably 1st quarter reporting next year for the effect to affect their bottom line. However, if you look at their Annual they have already started hedging through 2014. People are trading on future declines. They don't realize that this year (or are actively trying to keep the price down) management has strong hedges already in place. With the return (even at management's reassessment to the lower end of $5.50-$6.50 a share) this stock should be trading in the low to mid $40's especially when compared to their "parent" company CVI's price.
What you are seeing in the stock price is what I call "buying after the divvy" and is sometimes seen (but not very often) by buyers who wait for the divvy price to be factored in before they buy. They do this anticipating the next quarter price of the stock going up and /or buying the stock at the price in anticipation of the next quarter's dividend. You see this with companies that have strong dividend distributions such as EEP, CNSL (some others that I own) where buyers will wait for the "divvy dip" and then buy. It is a VERY GOOD sign that the next quarter, at least, has already been factored into the price going up.
Look's like one of our many "friends" is up to their old hacking tricks again on the Finance page. CVI is up $5.50 on the profile page while the Order Book shows the correct price at $1.72.
Yes. But be aware they also could be left with a lessened profit if the crack spread price differrential changes negatively toward them. I think the only question is that if CVRR will continue to be profitable playing the "spread" but by what percent? It may be difficult to sustain the spread hedge like was shown this quarter.
What is your definition of heavy? Last ten days of volume has been a fraction of the time leading up to the May 1st and 2nd events. No, I see shorts HAVING to reposition hoping to get one last massive panic. However, low volume tells me most people here now are holding what they have bought in anticipation of great news.
Also, talking about management moves, don't forget what they did with CVI - gave a special dividend of $5.50 and set up a yearly $3.00 dividend paid quarterly. I see them doing that with CVRR. Give out a special dividend in the $5.00-$6.00 range and then a quarterly dividend too. Probably not on the same scale as the $3.00 with CVI but around the $2.00-$2.50 range (my opinion closer to $2.00).
I would normally agree with you but if you look at the intraday trading marks there are spikes in the shares traded (both high and low pricing) which indicates large numbers of the shares being traded on a particular day are being bought and sold in a matter of minutes (if not seconds). This tells me that "shorts" are having to reposition themselves in anticipation of the stock eventually going higher. Just my opinion.
Question: Why is the stock declining in price over the last two weeks when the amount of stock traded per day for both CVRR and CVI normally has only hit a fraction of the average daily trade numbers? In other words, average shares traded per day for CVRR is 1.3 million shares, yet CVRR's price has gone down on daily average trading per shares of less than a million shares. Curious!
You can tell management has had it with the "shorts" trying to manipulate the stock price. A company does not move UP an earnings and conference call date unless they want to squash stock price swings with a POSITIVE announcement. Look out now for the price because "Here Comes the 'BOOM"
What happened at little over 1 year ago? Who might want some cash position to purchase a stake in another company? Announced today!
Come on ladies and gentlemen, think about it. The EPA regs and costs have been discussed at length. There is another reason why CVI and CVRR went down so far today. Come on, think, think.