by Travis Johnson, Stock Gumshoe | September 30, 2016 12:31 pm
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Source URL: https://www.stockgumshoe.com/2016/09/friday-file-a-volatile-quarter-a-rumored-buyout-and-future-buying-opportunities/
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I’m sure glad that I sold Skyworks at a nice profit and then bought NXPI. Now I have a pretty good profit on that stock too. I am waiting to learn the specific terms of the possible buyout and hope other offers will drive the price even higher.
Just want to say how thankful I am for you, Travis, and your honest and straightforward manner. I am also grateful that I stumbled onto your site. I followed for awhile and then joined. It is not only reasonably priced but has saved me a ton of money and time.
Just a little insider info on CCI that may or may not be helpful. We own a hilltop site where almost all the major carriers have towers. CCI runs a couple of the towers, having somehow inserted themselves between us and our tenants. They have made many offers to purchase the entire site, but the price seemed so exorbitant that I was wary, especially on a 10 year payout of double what we receive in rent. I checked out their stock and saw the huge valuation. I also noted they seemed to acquire all their sites in separate entities which meant they could default at any time because there was no corporate guarantee. I suppose that is a good thing if you’re a shareholder, but not so good if you’re a creditor. Every site should stand on its own.
I guess my point is that management is making huge bets on the future with OPM, but isn’t that what many corporate managers do… drive up the stock, get big salaries, and cash in options? I have no opinion on CCI management because I don’t know them, so they may all be good guys with long-term viewpoints. I hope so, but I’m not a buyer of the stock, and I think we’ll hold on to our site, even though we may all have satellite phones and internet 10 years from now. Maybe CCI will be buying or putting up satellites? Maybe not because they’re a lot harder to fix and upgrade because you can’t drive to them in a jeep and even though satellites don’t have to do battle with the elements or local zoning zanies.
Good insight, thanks — there was such a ramp-up in the value of towers for a while that perhaps the valuations got out of control, I don’t know… or maybe your site is far more valuable than you thought 🙂 Soon they’ll be working to place 5G antennae everywhere, I expect, so maybe there’s anticipation that site rentals will rise.
As far as site rents rising, that is tough to do as most small time site owners were tied up with 20 or 25 year rentals by the major carriers at 3 or 4% annual rent increases. I have refused to do this on renewals, so the carriers have to renegotiate after 10 years. Yes, perhaps that does make my site more valuable. I have been advised by CCI and others to keep my leases as short as possible.
Thanks Travis for your outstanding work, we are grateful for your insights and your sharing them with us. I know I speak for myself and many irregulars;-)!
Thanks to you I bought some NXPI and was rather pleased at that nice move. I sold half of mine for about 104.5 USD yesterday. Just to play it safe.
I had been eyeing NVDA as well at around 46, but waited so long that I felt I missed the train by now.
With DIS I am trying to be patient, i believe there will be a turnaround sometime…perhaps around the end of the year.
Recently i started buying into COR, but they seem to moving lower by the day. I feel a great buying opportunity, but do not understand why they are falling at all and for what reason. Ok, I can agree that they were overvalued for some time and moving up to fast, but this drop seems a bit over the top.
Do you have any more thoughts concerning COR ? As i am writing they are at about 71 USD.
Greetings from Germany!
COR is finally starting to look a little more appealing now, if I were building a position now I’d buy in small chunks — there could very easily be washouts in REITs during periods of interest rate chatter, and those would likely include the data center REITs, so there may be opportunities 10% lower as well at some point… but I do expect they’ll announce another substantial dividend raise (by at least 15%, given their history over the last few years), and anyone that can pay a 3%+ yield and increase that dividend doubled digits every year looks fairly compelling. Doesn’t mean it couldn’t trade back down to a 4-5% yield (or worse) if REITs lose favor or the market crashes, of course, but I think building a position as it falls makes sense if you can sit through some volatility and are believe that rapid or abrupt interest rate increases (in real rates, like the 10 year note, not the Fed Funds rate) are unlikely.
I totally agree with you about Medical Properties Trust, MPW, it is my largest holding. I don’t know if you know their CEO or dwarf Aldabra, but he is one very smart man. I have owned MPW for several years and at present price the yield is 7.5 percent which really make a difference 4 times a year. The best of all is you can sleep at night! Good luck to all. Royalfam
Correction to the spelling of CEO for MPW should be Edward Alda.