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Fifth Street Finance Corp. Message Board

stan1736 18 posts  |  Last Activity: Jul 27, 2014 11:42 AM Member since: Feb 22, 2003
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  • Reply to

    RSO and Earnings

    by mysonchino Jul 26, 2014 1:34 PM
    stan1736 stan1736 Jul 27, 2014 11:42 AM Flag

    Your point is well taken. As a long-term RSO shareholder, I have appreciated the dividend , but been disappointed regarding lack of improvement in NAV or in share price. During the 1st quarter earnings call, management confirmed that it expected AFFO to be .27 for quarters 3 & 4. This would nicely cover the .20 quarterly dividend. Considering the increase in loan originations this year, the recent securitization, a commercial real estate portfolio ( 73%) producing an ROE of 12 - 12 % , a leveraged loan portfolio ( 26% ) with a 15 - 20 % ROE, I believe in the predicted AFFO and the safety of the dividend. To management I would suggest that even a modest increase in the dividend and/or share buyback would be very positive for the share price.

  • stan1736 by stan1736 Jul 26, 2014 12:36 PM Flag

    On 6/30/14, short interest was 10.7 M shares; on July 15, it had decreased to 4.1 M shares .

  • Reply to

    Back From Coffee Break

    by tradelogic2001 Jul 22, 2014 2:29 PM
    stan1736 stan1736 Jul 23, 2014 10:07 AM Flag

    I have owned this stock for a long time. Management has no interest in shareholder value. Despite the fact that the share price has been below the cash per share, there have been no share buybacks and no dividend ; and management doesn't respond to legitimate shareholder inquiries. I will continue to hold since I believe that these shares are undervalued.

  • Reply to

    SPO price at 16.99

    by thewisejman Jul 16, 2014 9:32 AM
    stan1736 stan1736 Jul 16, 2014 10:24 AM Flag

    The drop is a knee-jerk reaction that always follows issuance of new shares by BDCs. Since new shares are issued above NAV, this is accretive for current shareholders. Today's drop = buying opportunity.

  • Reply to

    Any opinions on ARI

    by mysonchino Jul 14, 2014 1:45 PM
    stan1736 stan1736 Jul 15, 2014 6:33 AM Flag

    I have long-standing positions in RSO & ARI . ARI focuses on commercial real estate , an asset class with little new development the past decade. Co. pays $1.60/year dividend which seems safe . Fixed coverage ratio = 5.1 x. Robust pipeline ; book = $16.21 ; 54% of loans are floating; debt/equity ratio = 0.5x . All in all, a superior investment for income investors.

  • stan1736 stan1736 Jul 10, 2014 5:37 PM Flag

    As a long-time BDC investor ( incl.FSC), the market's knee-jerk response to issuance of new shares is a drop in share price. In reality, assuming the new shares are issued above the current NAV of $9.81, the event will be accretive to current shareholders. Since BDCs have to pay out most of their earnings as dividends, issuing shares is the way they grow. I presume the new funds will be put to work promptly; average yield on debt investments is 10.8% . I expect that tomorrow's drop will be of short duration . A share price decline below the issuing price = buying opportunity. Just one man's opinion.

  • stan1736 stan1736 Jul 9, 2014 4:36 PM Flag

    Well today we saw somewhat of a selloff on hugh volume ; and on a day with most stocks up. Might just represent an institutional investor bailing out ; or possibly a prelude to an announcement later today or tomorrow. We shall soon see. Other opinions appreciated.

  • stan1736 stan1736 Jul 9, 2014 6:07 AM Flag

    According to one of the experts on Fast Money yesterday afternoon (MSNBC), yesterday's stock drop was an over-reaction since the terms of the bond issuance were favorable to SDRL. As often happens , the initial response by the market to an announcement is an over-reaction. I commend management for its prompt response. IMHO, the stock , even before the drop, was undervalued; and the dividend, albeit high, is safe.

  • Reply to

    what gives with this sector?

    by nadsmis Jul 7, 2014 4:39 PM
    stan1736 stan1736 Jul 8, 2014 8:46 AM Flag

    Having shares of AYR & FLY, I don't appreciate the recent drop in share prices. But I'm quite comfortable with the underlying business plans/outlook . AYR has a net interest margin of 9.5% ( rental yield of 14% minus debt cost of 4.6%) . Combine this with over 98% utilization, $715M new investments YTD, a book value of $20.30/share and a 4.6% dividend = undervalued stock price. For FLY, 15% fleet growth this year, 99% utilization, book value $18.13, dividend over 7%, $30M share repurchase program,$381M unrestricted cash . increasing global air traffic.

  • are well worth reading. As a long-term SDRL shareholder , I have assumed that the recent dividend increase, albeit minimal (.02), sends a message that the Board is confident that $1 per share quarterly is sustainable. While a 10% dividend is often suspect, recent share price action suggests that investors are beginning to realize the value and dividend sustainability of SeaDrill.

  • Reply to

    Price of Bromine

    by marubadbad Jun 19, 2014 7:00 PM
    stan1736 stan1736 Jun 20, 2014 5:52 AM Flag

    As a long-term shareholder, I have been frustrated by the fact that the cash/share has exceeded the share price for some time in a company with minimal debt. Yet management refuses to buy back shares or to initiate a dividend. What will it take for them to consider the interest of their shareholders ? A mystery in view of the sizable inside ownership.

  • Reply to

    Seadrill expects dropping Dayrates-Motley Fool

    by sgthoov Jun 19, 2014 4:52 PM
    stan1736 stan1736 Jun 19, 2014 5:36 PM Flag

    From a 6/11/14 Motley Fool article on SDRL - " ...EBITDA interest coverage ratio of 6.5 ...can service debt and pay the current level of dividends from the operating cash flows "
    From Morgan Stanley on 6/16.14 -" Offshore rig demand is on the mend..We see deep value in SDRL..."

  • Reply to

    General BDC question, would like opinions

    by thedoritogirl May 23, 2014 10:21 PM
    stan1736 stan1736 May 24, 2014 6:05 AM Flag

    In June, 2013 ( sorry, but I don't have a more recent graph ) , Wells Fargo put out a chart listing the 12 month yield and three year total return of mortgage REITs, BDCs, energy MLPs and the S&P 555.With regard to yield, BDCs were just below 10%, second only to mortgage REITs at just over 10%; both of these were well ahead of the other categories. As to total return, BDCs far outdistanced the others, at 35%. Energy MLPs in second place at 19%. S&P 500 at 12%. BDCs have been a mainstay of my portfolio in recent years, a superior vehicle for yield in an IRA account. So recent drop that followed exclusion of BDCs from certain indices may present a buying opportunity, especially when share price is below NAV.

  • Reply to


    by eatbrowneggs May 16, 2014 9:39 AM
    stan1736 stan1736 May 16, 2014 11:33 AM Flag

    It is now trading .

  • Reply to

    Upbeat Earnings!

    by trev1957 May 14, 2014 5:14 PM
    stan1736 stan1736 May 14, 2014 10:03 PM Flag

    " Upbeat " ???? Each quarter we see mediocre results accompanied by a prediction that the stage is set for "significant growth " ; and the share price languishes.

  • Reply to

    This was the PE Deal of the year

    by spal4000 May 11, 2014 10:52 AM
    stan1736 stan1736 May 13, 2014 8:27 AM Flag

    Thanks for your prompt and perceptive response.

  • Reply to

    Just Started Following SDRL

    by phildog May 9, 2014 10:09 AM
    stan1736 stan1736 May 13, 2014 6:33 AM Flag

    As a long-term SDRL shareholder, the negative comments by analysts concern me. Yet I believe the dividend to be sustainable . 97% of floating drillships booked for 2014; 65% for 2015; 84% and 64 % of semi-submersibles ; 92% and 64% for jackups. SDRL has a higher EPS growth , higher ROE and much higher dividend than peers . Over $20B backlog is reassuring. So why the negativity ?

  • Reply to

    This was the PE Deal of the year

    by spal4000 May 11, 2014 10:52 AM
    stan1736 stan1736 May 13, 2014 6:19 AM Flag

    Thanks for this perceptive posting, a rarity on this message board. I would appreciate your further thoughts on where this co. is headed. As a frustrated shareholder, I've written management on multiple occasions in recent years suggesting that they take ULTR private since they are certainly not running it for the benefit of the stockholders.

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