The numbers I am presenting come STRAIGHT FROM RAS Mar 31 qtr net income $762k less
pfd stk div $7.8m = NET LOSS $7m. Cash Flow - the only true positive cf is depreciation & teeny
amortization, total $20.7m On cf statement they deduct the $7.8m pfd div leaving true cf $12m.
From that they paid out $14m common div. Net result - co in the hole $2m .They're paying out
more than taking in. These nos.are from RAS, statements. I didn't invent them.
Any prudent real estate investor sets aside reserve: for real depreciation, amortization etc.There's
no special skill required in spending every last dime. So why does RAIT do this? And btw they're not
alone. But RAS is different .That $12m/qtr x 4= $48m/yr. And a good part of that comes from lending
ops. Total invested capital is $3BILLION. $48m yr is supposed to be good? Of course if you want to
measure that return based on common equity approx. $300m it looks great.
However that $48m/yr plus some is paid out in common dividends.
And that' s my objection & why people & co's. get into mischief. Instead of "reserve for a rainy day"
they go overboard. The money's spent before they have it. But in all of this the proof is in the pudding. Nobody's bidding price up. In fact we're at a 2 year low. It can't all be manipulation & shorting, unless
you believe in the tooth fairy. Personalities aside you do a disservice on this MB. Your comments,
summations, analyses are biased, mostly wrong, & hedged. And bragging about buying cheap
stock years ago don't give any points. You are one irritating so & so.
Def. DEPRECIATION: decrease in value due to wear & tear, decline, decay etc. Leave a building go for 33
years & it's worth bupkis. That's IRS rules on the subject & they didn't come out of thin air The only
connection to money spent in prior years is diminishment of value. It's obvious you've never been in R.E biz
Def. AMORTIZIATION: the paying off of debt over a period of time
It might be helpful if you took course in r.e. investing & some accounting
I'm surprised I didn't get the usual blasts from my detractors which leads me to believe that
my assessment is correct since I use RAIT's own authentic nos. Since I'm so critical of mgt & the
loud mouth cheerleaders [who are far from being always right] why do i invest here? 1.I don't
personally want the work in running a re &/or lending co. 2. I think re holdings understated by $3/sh
3.div is sustainable, even tho I'd like it reduced 4.the vague possibility mgt will tone down aggress-
iveness insofar as leverage 4. I think the re down cycle will reverse 5. the various array of alternative investments [almost all overpriced] 6.the fervent hope that somehow co. will actually make a profit.
Posting here serves a few purposes 1.relieves the monotony of trading 2.Helps coagulate my
thoughts 3. hoping to be of service to others. 4.stopping persistent one way doubletalk of ykw
Btw dr hugh RAS has sold 3 properties & dIvs common or pfd are NOT TAX deductible. They are
simply a method of passing tax burden to investors. Int exp IS always tax deductible xx
Co is losing money & so are stkholders. Q1 lost $7.85m after pfd divs. Who's kidding who?
DEPRECIATION! Sure it's a cf plus, but that doesn't make it a nonexpense. IRS allowable depr
exp is pretty fair assessment, apt's roughly 3%/yr., AND some of that is used for repairs,etc
which get bigger as property ages PLUS what about DEBT AMORTIZATION, that doesn't count
either? I've been in apt hse biz. The av cf was maybe 7% cash return on cash invested.
Schaeffer has loaded co up with debt & worse a ton of pfd whose div. not even deductible.
There's no magic in what Schaeffer is doing which amounts to nothing less than blindsiding
stkhldrs.with stupid div. As far as lending biz goes the only thing I can say is for all it's profitability
based on q1 results it's a loser. We'll see what happens after q2 results
None of this makes much difference to me, I'm a stkhldr. But the notion of some indivduals about
how great co. is disgusts me. It reminds me of #$%$ propaganda on German people. They were
all fooled except those who fooled themselves. In this case the no's. tell the story. Right Dr. A?
Who is that boy who loves to annoy? He's donbogus
Who is the lad who bs's like mad? He's donbogus
Why can't he quietly go away, It would make us smile
And while he's at it he can even take lisle
Last on the list is the dude- y boy fraud, with him gone i won't be so bored
You juvenile delinquents make me laugh. Don't understand finance at all. I don't pump
like crazy, I don't panic .I don't bash. My function is simply observation. I still think RAS is undervalued. In fact I bought quite a bit yesterday between 6.20 & 6.08.
Nevertheless re stocks have been falling out of fashion . Today I bought some RCAP.on
sell off. Interesting there was pr "agreed to LEVERAGE-RATIO covenant amendments etc"
As I said b4 I'm not the only one concerned.
My biggest concern with RAS is the UNEXPLAINED $11m decline 1stq net int inc..JR do you
know what I'm talking about? I'm keeping fingers crossed will be reversed. I'm also waiting
to see next short int. report. BTW how's my cutie pie?
Supposed to be Will Rogers, sorry. That 8-1 ratio includes pfd, just common is more.
There's another explanation for price drop. Dividend players. There's a sh/ld of players who time
buys & sells with ex div date
Don't get me wrong I'm not especially bearish just disgusted .There's a lot worse one can do But
getting taken to the woodshed so much makes one mighty sore.
It's in mgt hands to make changes that would restore confidence. If they're smart they'll wise up
I repeat this stock is, depending on one's interpretation, dangerous.. Co. excessively leveraged to
the tune of 8-1, debt to equity. Evidently I'm far from alone in this conclusion. Somebody-ies
selling. This may be one of the reasons. Scott Schaeffer is the ultimate gambler. His risk taking
not appreciated by everyone. The simple fact his strategy is colossal failure.His dividend polices
are being seen for what they are - capital destruction. I've warned about this before. Major investors
are pulling back from these types of investments. They don't trust them
That's not to say manipulation doesn't come into the picture - I'm sure it does. As far as big div's are
concerned, in the immortal word of Woll Rogers "I'm not so much concerned of the return on my
money but the return of my money
imo the problem may simply be excessive leverage out of fashion. and for very good reason. It's
dangerous. This co has debt $2.7BILLION common equity $357m. That ratio is 8x debt to equity.
Scott Schaeffer is a reckless gambler & must take steps to reduce it. Not only that , but his strategy
of employing all this leverage is a failure. Maybe df can talk some sense into him
Something is preventing sales from happening. There are thousands of welding shops, body
shops etc. IT'S NOT A QUESTION OF THE STUFF DOESN'T WORK. IT DOES. Yet users are
reluctant. It may be the $saving is not that important, or committing to new technology is more
trouble than it's worth, lasers or other, who knows what?
So the co. has embarked on a new strategy, convincing major users to at least try it. But bucking
the old proven methods is tough. Think about it. Whoever sticks their neck out potentially could
lose their heads. Naturally if co can land some major users who use mg successfully is all that
would take. But can they? We really don't know. Some users are at least willing to experiment.
That's good. But how long can co last without solid results?
Putting money on future success is dangerous. Right now it's all kind of iffy. What personally
annoys me is guys like Lisle who think pr's are all it takes. We just don't know yet
Silvino & Winsor laying it on thick but concealing the nightmare of what's really going on behind
the scenes. Why? They think they're so clever.. I'd like to see their faces at the end of a lawsuit
SEC DOESN'T TAKE KINDLY TO DECEPTION
The fact is you made a reckless gamble, that's all. Co. has failed on every metric except bs.
They are entering life support territory. Notice the absence of info on REAL progress. That's
because there is none This ESSI acquisition is another folly. Co. overpaid for illusion. Can't even
run it right. ES stabbed stkhldrs in the back for this nonsense
I bought boatload of this bupkis at .45-.50c. So what! It's not worth any more. I refrain from bragging
rights because it's just a roll of the dice. Your exaggerated sense of being correct is due to luck.
It's gone to your head. You have no idea , as do any of us what's going on behind the scenes,
If stock would have gone down instead of up you wouldn't post. Maybe you have a charmed life,
I wouldn't know. But statements like kids college fund could backfire in your face.3% institutional
ownership speaks volumes. Mister, you are totally out of touch with reality