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Cadiz Inc. Message Board

xds58 16 posts  |  Last Activity: Feb 24, 2015 5:23 PM Member since: Mar 26, 2002
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  • Reply to

    Davis/Ethison, question

    by xds58 Feb 24, 2015 4:09 PM
    xds58 xds58 Feb 24, 2015 5:23 PM Flag

    PS this is specifically what I'm referring to - floating not fixed (correcting my last post)

    During 2014, RAIT sponsored two floating-rate CMBS securitizations providing non-recourse, matched-term financing for $415.4 million of RAIT originated first mortgage loans and participations. RAIT successfully issued and sold $337.1 million of investment grade notes with a weighted average cost of LIBOR plus 1.68% representing an advance rate of 81.2% through these securitizations. RAIT retained the subordinated interests of these securitizations totaling $78.3 million which RAIT expects to yield double digit return over their anticipated life.

  • Reply to

    Davis/Ethison, question

    by xds58 Feb 24, 2015 4:09 PM
    xds58 xds58 Feb 24, 2015 5:17 PM Flag

    So that's for the loans they keep on BS, right? Mostly floating rate bridge loans?

    But the fixed rate loans which are securitized, my sense is they lend 100 (the asset), they securitize 80 at a spread, and they hold the last 20 plus a fee. I believe they are junior in this scenario, no? So if the loan pool (asset) defaults 5%, that's 5/20 = 25% of their junior position. Or am I missing something?

  • Reply to

    Davis/Ethison, question

    by xds58 Feb 24, 2015 4:09 PM
    xds58 xds58 Feb 24, 2015 4:32 PM Flag

    PS - one of the reasons I've liked this name is I don't think they get enough credit for the owned RE. I do worry though about the lending side - not clear to me what their assumptions on losses are when they calculate ROIs - w 80% debt ahead of their subordinated position on securitized conduit loans, modestly higher default rates would take a bigger chunk of their equity position - this is a little different from a traditional bank lender, where the bank is leveraged, but has first call on collateral - it may be ok, I just have yet to really get my arms around the operating model on the lending side - and I have been following this name for quite some time -

  • Reply to

    Davis/Ethison, question

    by xds58 Feb 24, 2015 4:09 PM
    xds58 xds58 Feb 24, 2015 4:25 PM Flag

    any thoughts on the stock reaction?
    The IRT consolidation makes the rental rev line a little misleading - not RAS' fault, just GAAP I assume - but have to back out about 30 mil of full year rental rev -

  • Reply to

    Davis/Ethison, question

    by xds58 Feb 24, 2015 4:09 PM
    xds58 xds58 Feb 24, 2015 4:15 PM Flag

    Right - I was actually wondering about income stmt - but I think the answer may be that IRT is more or less break even on a GAAP basis, so there isn't much income to back out -

  • So they indicate on the conf call that the increase in rental income is from IRT - I don't get the presentation here though - if IRT is non-consolidated, which I believe is the case, shouldn't this show up as equity income? And if IRT is consolidated, shouldn't there be a minority interest line?

    On another topic, any thoughts on the negative reaction to the release? I'm not seeing much new here - were people hoping for a dividend raise?

  • Reply to

    $8 million more

    by ethison Feb 24, 2015 10:22 AM
    xds58 xds58 Feb 24, 2015 2:05 PM Flag

    That's positive, as is the sharply higher rental income. There were a few negatives - much lower net interest and some higher operating costs among them. I haven't gotten my arms around the moving pieces yet. Did you listen to call? There was some discussion of spreads, which is a risk as their book turns over. But I have to listen to again to get a sense of outlook -

  • Reply to

    Thinking of investment strategy;

    by skiplarson98 Jan 26, 2015 11:35 AM
    xds58 xds58 Feb 4, 2015 2:47 PM Flag

    Think you're missing a couple things:

    1) even though oil is down, so far polyurethane prices are not. That's because US market remains fairly tight for polyurethane. Polyethylene is down, but that doesn't help here.

    2) the medical products space is competitive, but not commoditized. That's evidenced by decent operating margins. The custom line is commoditized.

  • Reply to

    Joel

    by ethison Jan 6, 2015 10:31 AM
    xds58 xds58 Jan 6, 2015 11:13 AM Flag

    Buy, buy, buy - the ex date tomorrow gives a little extra cushion

  • Will you get on that Seeking Alpha site and post one of your thoughtful rebukes?

    You're waiting to accumulate shares aren't you, you dog!

    SA releases the article first to SA pro, to allow subscribers to take positions, Then they release to free site. It's a scam, and I've seen it before. The only way to beat it is to join it. I'm hard pressed to believe it's legal, but so it goes.

  • Reply to

    Smells like teen equity issuance?

    by xds58 Jan 6, 2015 10:05 AM
    xds58 xds58 Jan 6, 2015 10:50 AM Flag

    thanks, yeah, I just saw it. It was originally a seeking alpha pro piece. This is basically front running - article comes out on pro, subscribers short or sell if long, then article released on free site, and all the suckers follow suit, only to realize a week later they were basically lining someone else's pockets (or maybe they never realize)

  • I see, its the seeking alpha note - which appears to have some misinformation

  • or is it Fed worries? What gives w the big move one day before goes ex? are our friends up to their equity issuance mischief?

    A bit under the radar, they are building out the fee income from IRT at a pretty steady clip. This fee mgt stream is going to be worth $100 mil plus in a couple years, at a market cap rate.

    So don't dilute! wait for $10, and then issue.

  • Any guesses on why CPE up today? Maybe on Fred Callon's presentation yesterday, which was after mkt close? Something in breakout?

    I see the Pioneer caption, but what's that based on? Callon has been an obvious target for some time, but they have liquidity to last into 2016, why would they sell now with oil below $60? They don't have to, at least not yet.

  • I see the Pioneer caption, but what's that based on? Callon has been an obvious target for some time, but they have liquidity to last into 2016, why would they sell now with oil below $60? They don't have to, as best I can tell. The time to sell was back when it was above $10.

    The company spoke at Cap One conference yesterday - maybe something was said in the breakout? Also, an insider buy yesterday. All that info was available yesterday, but maybe slow reaction?

  • Reply to

    Had to buy more today below $69

    by newelectricfan Dec 8, 2014 2:44 PM
    xds58 xds58 Dec 8, 2014 5:59 PM Flag

    Is that data on the Bloomberg paid service or the website? Most of us won't have access to the paid service.

    That said, taking an avg spread at a moment in time misses the fact that spreads constantly widen and narrow, that regional pricing varies widely, that demand likely to improve w gas at pump lower, that price pass through to consumer typically delayed widening crack spread, in addition to new investments coming on stream and share repurchase - in other words there are a number of variables you're ignoring.

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