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BIOLASE, Inc. Message Board

stocksfm 6 posts  |  Last Activity: Dec 13, 2014 8:40 PM Member since: Nov 26, 1999
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  • Reply to

    STRESSED ASSETS

    by stocksfm Dec 13, 2014 6:32 PM
    stocksfm stocksfm Dec 13, 2014 8:40 PM Flag

    I think some of the debt will go bankrupt but these companies still have valuable reserves that has to have some recovery value. Also, the fund guys told me that since inception only two credits have gone bankrupt.

  • stocksfm by stocksfm Dec 13, 2014 6:32 PM Flag

    I looked at the holdings as of 12/12/14 to get a sense of the risky assets:

    Although the fund holds some equities, there are 6 equities (Canadian Oil and Gas) that have swooned significantly and presently comprise 6% of assets.

    On the debt side, 15% of the assets involved debt trading between 39.5 and 74.8 cents on the dollar.

    So, the stressed assets make up 21% of the fund. Given the active management, not all will default and with the fund down nearly 25% from its 52-week high (and a yield approaching 10%), this risk may already be priced in.

    Sentiment: Buy

  • I looked at all the NAVs going back to inception on 11/30/2010 to determine the frequencies of HYLD price discounts to NAV of greater than 1%. It is rare that any fixed-income ETF trade at a discount that large, but here is what I came across:

    15 days with a discount between 1% and 2%

    5 days with a discount between 2% and 4%

    2 days with a discount of 4.1%

    On Friday, HYLD closed at $42.86 with a NAV of $40.75 - resulting in a bizarre discount of 5%.

    Based on the history of this ETF, I can't see this discount (or any discount) remaining.

  • Reply to

    How leveraged is this ETF?

    by singer2045 Dec 13, 2014 4:30 PM
    stocksfm stocksfm Dec 13, 2014 5:29 PM Flag

    I called the company on this very topic a few days ago and they said the fund is not leveraged. Although the website shows a negative 4% cash position, they indicated that it is related to pending securities transactions.

  • stocksfm stocksfm Dec 12, 2014 1:36 PM Flag

    What is really bizarre is that it is trading at a near 5% to NAV - that is unheard of in the ETF world - so i bought more.

  • stocksfm by stocksfm Dec 10, 2014 8:06 PM Flag

    The fund does post all its holdings on its website daily. You can clearly see what credits are under stress. As of 12/9/14, 16.8% of their debt positions are trading at below 80 cents on the dollar. Further detail revealed:

    Below 70 cents - 3.14%

    Between 70 and 75 cents - 7.6%

    Between 75 and 80 cents - 5.6%

    Unfortunately. this fund has a 6.6% allocation to six Canadian Oil and Gas companies which are trading at prices way below their 52 week highs - in fact, they are all trading at less than $10/share. Further detail revealed:

    Below $2 share - 2.1%

    Between $3 and $5 - 3.5%

    Below $9 - 1%

    So if you add up all the current positions in the fund that are under STRESS you get approximately 23% of the funds assets are at risk. I assume that 50% of the risk assets may default - so one should assume a 10-12% future haircut in the fund. But since this fund has researched its positions thoroughly as opposed to the non-managed JNK and HYG ETFs, the default rate may be lower.

    Just ones opinion!

    Regards,
    FM

BIOL
2.170.00(0.00%)Mar 2 4:00 PMEST

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