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Compass Diversified Holdings Message Board

richardleeds 197 posts  |  Last Activity: 7 hours ago Member since: Apr 1, 1999
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  • Reply to

    Cheap stock

    by analyst112 Sep 10, 2014 11:32 AM
    richardleeds richardleeds 7 hours ago Flag

    The problem with this reit is that the price of the equity is almost back to where it was 4 years ago, so no appreciation, just the distribution. Better to invest for 5%-7% distribution and growth in the equity of 5% or more each year and there are many of those.

    O, ARCP, CSG, etc.

  • Reply to

    $100 billion

    by cats_paw_kid Sep 17, 2014 12:27 PM
    richardleeds richardleeds 9 hours ago Flag

    selling shares by management always drives share prices down and who wants to buy something when management is dumping....

  • Reply to

    Shorts take the reins, as CMLP hits resistance

    by crk00 Sep 5, 2014 6:57 PM
    richardleeds richardleeds 9 hours ago Flag

    Every investment connected to oil has been down as the price of oil dropped 10% during the quarter. The problem with CMLP is that the share price has not really climbed at all during the bull market that has taken the indexes to all time highs during the last 4 years. No real equity appreciation while most all the MLPs are up significantly over the last 4 years.

  • Reply to

    Key problem as I see it.

    by richardleeds Sep 16, 2014 1:07 PM
    richardleeds richardleeds Sep 17, 2014 9:15 PM Flag

    Oil prices around the globe is the reason for the decline in share price over the last month. Oil prices have been weakening and prices have fallen 10% during this quarter. That has had a more dramatic impact on small Canadian producers that receive another 5%+ discount on energy sold below world pricing.

    Gas prices have been dropping at the pump and apparently that is not over.

    I stand corrected the debt is lower as they sold off some production. Now they have to drill wells to get the production back.

    The biggest issue is oil pricing and the last quarter looks weak and what will happen to the share price? I expect it is going lower.

    Yes the shares could double in price over the next 1-2 years. But the same could happen for a stronger company, SURGE. But prices are probably going lower.

  • Reply to

    Key problem as I see it.

    by richardleeds Sep 16, 2014 1:07 PM
    richardleeds richardleeds Sep 17, 2014 1:32 PM Flag

    Not tax planning, just human nature.
    If an investor has lost 20-30% in shares they tend to sell, causing pressure on the price.
    December is a significant month only because it is the last time to get an immediate
    tax write-off if you do not have a $3000 capital loss at that time.

    I was rounding debt to $350MM and value of company to $150. OK, I stand corrected debt
    is higher on this little stock than I said.

    This is interesting but I like the size of SURGE much more than these shares.

    The problem is the price of oil on the world markets as it looks to be weak as there
    are issues in China and Europe and for that matter in the U.S. where oil production
    is increasing.

    If oil drops to $90 per barrel or less during the last quarter, these shares could test
    under $1.20.

  • Reply to

    Key problem as I see it.

    by richardleeds Sep 16, 2014 1:07 PM
    richardleeds richardleeds Sep 17, 2014 1:27 PM Flag

    You have to take into perspective that the shares lost 20 cents during the last 30 days.
    Agree, it is not the debt that caused the fall but the drop in the oil price which could
    weaken further, causing more pressure on all oil and gas producers.

    If it keeps falling a penny every day, I might have to enter sooner rather than later.

    Appreciate your comments.

  • richardleeds by richardleeds Sep 16, 2014 1:07 PM Flag

    With the sale of assets the company reported that
    it paid down total debt and lines of credit to $350 million.
    That is still a lot of debt for a company that has a market
    value of $150 million.

    What is going to happen with tax loss selling in December?
    I would not be surprised if this goes lower still. It might be
    an excellent buy come December.

  • Reply to

    NEWS 9/10

    by dukeswaikiki Sep 10, 2014 10:50 PM
    richardleeds richardleeds Sep 15, 2014 7:40 PM Flag

    Pie in the sky.
    Look at the balance sheet, current liabilities exhaust all the cash.
    When there is no cash left at the end of the year they will have
    to issue more shares. Right after tax loss selling, so I suspect
    the shares will be lower in 90 days than today.

  • Reply to

    I still like this value play

    by booleansearcher Sep 11, 2014 6:53 PM
    richardleeds richardleeds Sep 15, 2014 7:32 PM Flag

    management is questionable as share price is at low of the last four years and
    if management has cost overruns on the high rise towers or high vacancy on the
    towers the risk of a dividend cut is substantial.

    You have to ask yourself when most markets around the world are at highs for the last 5-6 years why this equity is at low in its history. That says a great deal about investor confidence and risk.

  • Reply to

    Reason it is still overpriced

    by richardleeds Sep 15, 2014 12:41 PM
    richardleeds richardleeds Sep 15, 2014 7:21 PM Flag

    The cheap acquisition price of these two rigs has been wiped out by the current selling price of the shares. People that have paid $20-25 dollars a share were basically paying triple the price of the rigs. So it is not a good deal for shareholders in that price range.

    They have a $500 million backlog but much of that goes to operating the rigs.

  • Reply to

    I still like this value play

    by booleansearcher Sep 11, 2014 6:53 PM
    richardleeds richardleeds Sep 15, 2014 12:53 PM Flag

    The company equity is valued at $500+ million.
    The risk to this equity is that the two high rise towers
    have a total cost and capex to open them as two dorms
    of about $200 million dollars of which Campus is on the
    hook for 1/3 of the cost. The verdict is still out on this
    venture and that is a substantial risk. Secondly, management
    screwed up on the Copper Beach investment, an investment
    which they do not control and which they walked away from
    buying the other 52% which tells you that there are issues
    with Copper Beach, both the portfolio and they do not operate
    the investment.

  • richardleeds by richardleeds Sep 15, 2014 12:41 PM Flag

    Ensco, Noble, Rig are all selling for less than 1X book value of the assets
    on their balance sheets. This company is selling close to 3X book value of
    its assets.

    Second, the contracts are short term now, about a year left and when they
    are close to expiring in a year a lot of shares are going to try to exit all in
    the same 90 day period and AWLCF will probably see constant pressure
    from here on out on the price including the tax loss period during the last
    30 days of the 4th quarter as many that are upside down will sell to take
    losses.

    Thirdly, what happens if one of the rigs takes some time to re-lease the
    rig and they have a quarter with no income, just debt payments. The
    negative news usually drives down shares.

    Three reasons this is dangerous, especially during periods of war
    and economic difficulties.

  • Sanctions are U.S. and Europe and so
    SDRL is not going to do business with
    Russian Energy giants.
    These sanctions will hurt international
    energy related companies.

  • richardleeds by richardleeds Sep 12, 2014 1:14 PM Flag

    Shares have gone down to low of the last 5 years and most investors
    including myself have lost big time over the last 5 years. Management
    that watches stock decline for 5 straight years should have been fired,
    but obviously, the Board of Directors is controlled by management so no
    one is going to make any serious money in this investment. I am getting
    ready to dump at the bottom and move on to something that might double
    in price.

  • Reply to

    What's driving the price drop today?

    by asiabynight Sep 12, 2014 11:53 AM
    richardleeds richardleeds Sep 12, 2014 12:53 PM Flag

    Economic war with Russia by U.S. and Europe. It is going to hurt all economies that
    provided services and capital.
    I imagine Putin will even look negatively on Russian businessmen that purchase high
    end German cars during this economic war.

    Also, U.S. is go to expand war in the Middle East. War does not help the economy it
    strains it.

    Just lots of bad news nothing to do with RIG business, but remember lots of drilling
    platforms being delivered during the next 12-24 months when world economy may not
    be growing much and Europe might be contracting.

  • Reply to

    Shifting pressure.

    by bigbear.2010 Sep 12, 2014 10:45 AM
    richardleeds richardleeds Sep 12, 2014 12:27 PM Flag

    The price had run up and it was selling close to 3x book value. Even though the platform rigs were purchased at a good price, investors were paying triple the cost of those rigs to the company. Not a great deal.

    Also, the contracts are going to expire on the two rigs in another year. What happens if the new contracts have down time and no dividend? Also, what happens when all investors try to unload during the same quarter when these rigs are close to expiration. A small investor group on this exchange can get killed when too many of them see the risk all at the same time.

    That is why most investors in this equity might not make any money even with a high dividend over 2014 or 2015. Investing in this security is more like gambling than investing unless you purchase at a price that is at the bottom or very close to the IPO.

  • Reply to

    Which brokers withheld 15% on the dividend.

    by aapl_2000 Aug 26, 2014 4:00 PM
    richardleeds richardleeds Sep 12, 2014 3:57 AM Flag

    Etrade told me that the withholding rate of 30% and the additional ADR fee was done at the source in Russia. They also said the dividends were non-qualified, so taxed at ordinary income tax rate, not preferential 15% tax rate.

    Lousy dividend after taxes take 1/3rd.

    Until stock brokerages around the world recommend the shares, the share price will probably remain week since small number of international investors will not drive shares higher.

  • Reply to

    A nickel away from the 52-week low

    by biotechprofiteer Sep 11, 2014 3:17 PM
    richardleeds richardleeds Sep 12, 2014 3:12 AM Flag

    Beside the weakness in the NOK, the price of the shares is almost three times
    the book value of the company. Why pay 3 times the cost of the balance sheet?
    Three times the cost of the drilling platforms makes them pretty pricey and the
    contract price for the rigs has a short contract time. What happens to contract
    prices for everyone in another year? By guess is lower prices and what happens
    when the current contracts expires? Most investors will try to get out in 12 months
    and there could be a large number of investors trying to sell driving the price
    down.

  • Reply to

    A Great Run Company with a GREAT Dividend

    by taffy123414 Aug 18, 2014 4:49 PM
    richardleeds richardleeds Sep 5, 2014 1:34 PM Flag

    Not a great run company. They purchased 48% of Copper Beach with an option to purchase all of it and then did not purchase the balance of the company. So they have a minority position with no control on an investment that they decided was not performing sufficiently to justify buying all it.

    Also, they are building out two speculative high rise towers for high end student dorms.
    The verdict on that risky transaction is not in and if it does not perform it will result in a further share price decline which will wipe out any dividend you earn for the next year.

    The investing public is saying Campus Crest is too risky and management has not demonstrated that they can enhance shareholder value, that is what the share price is showing.

  • Reply to

    Don't buy this until it hits Normura $16 target

    by masleym Sep 3, 2014 10:32 AM
    richardleeds richardleeds Sep 3, 2014 3:38 PM Flag

    Remember,

    All the insiders and early investors got in around $14 U.S.
    Between the dividend and appreciation they made a killing during the
    last year, 50% return.
    Time to take profits and get back in at $15 or 16.

    I still believe SDRL is a better buy for long term appreciation.

CODI
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