Junto

i agree that the forum has a biased opinion regarding WEST and Biglari, but one thing he has done is put results on the table. We will see how it plays out from here but I am certainly riding out the rebound in SNS for the time being.

Parsad, that looks like a rough investment...their 1st quarter 10-Q they were not sure they would have enough cash to make it through... "NOTE 6: GOING CONCERN At March 31, 2009 and December 31, 2008, the Company had current assets of $34,626 and $23,556; current liabilities of $1,052,626 and $686,125; and negative working capital of $1,018,000 and $662,569, respectively. The Company incurred a loss of $93,953 during the three month period ended March 31, 2009. The Company receives quarterly cash inflow of $25,000 from management fees and $11,500 from investment distributions, but expects quarterly cash requirements of approximately $130,000 per quarter commencing in the second quarter of 2009, assuming the acquisitions discussed above are not completed." No moat in this one.

i thought it was worth the time as well.

Thanks for your comments. I will likely engage counsel once I get to that point. My main goal to start is to get my head around the steps and the process. I have watched it from the sidelines and as a supporter at several firms but this is my first foray into doing it myself. First research then action. I am working on the research part and thought this board could potentially direct me to some good resources.

U.S.

Is anyone aware of the ability for a shareholder to get a list of all other shareholders in a small OTC company? I am eying a local company I think I could actively approach current shareholders and push for change/potentially take over with the right funding and time. The problem is that it is a very thinly traded firm and I am unsure of the composition of the ownership. I know I am in over my head in this arena but think this is a great opportunity thus I will be building a position in the firm over the next 12 months. Does anyone know a good resource to find out if you can get access to the shareholder list and detail? Any resources would be appreciated. Thanks! edit... I am referring to a firm in the United States.

there is an RSS feed for listed firms at sec.gov that is the easiest I have found

I think netnet is right on regarding opportunity cost and I believe that it should be the driving factor.

I agree. I equate the daily posting to message board spam. I should note that I have been an RSS subscriber to his blog for some time.

I hear you Eric, logically you are correct. My selling has more to do with making me positioned for other opportunities and outside the market investment ideas I am working on. The preferreds I sold were LNC-G 1/2 position, AIV-Y all, JPM-Y all, ORH-A all, the others I have pretty much kept in my bucket. On a core basis even with my equity positions figured in, my portfolio yield is 10.77%. Now if some of the banking stocks out there reinstate their dividend in the upcoming couple of years (JPM, WFC for example) these numbers will once again look better.

I am curious if anyone else on this board has been using this service to track one of their portfolios over the past few months/year? The website is www.covestor.com

A Great Blog and good resource regarding Net-Nets and liquidation analysis is http://greenbackd.com/ I highly recommend it.

I don't deal in some of these preferreds but both HRP-B and HRP-D have had great run ups over the past couple of weeks and the common stock has been up even more. I might also dabble in this sector as I trim positions in the bank preferreds.

I also have enjoyed the runs. Instead of hedging positions, I have been slowly trimming my positions in the preferreds. Seems like the simpler play for me right now. I have paid down my leverage and am sitting liquid again. I think that the bank's will fair well in the stress tests; primarily due to the current yield curve. given 0% fed funds rate you have to have a pretty messed up balance sheet not to make money. The bank's that show the worst stress tests are the ones that have already been fighting for their lives. The good banks, US Bank, WFC, JPM, and others will only gain market share and strength in the current market. This is my opinion. I don't have the facts in front of me to support it at this time but have been watching this sector like a hawk for the better part of the last couple of years.

agreed

CTZ-A, Holding company with ample liquidity, good capital position, core earnings still good, needs to stop the provisions and the one time write-downs. Terrible market area but has been doing business there forever. As i have said, I personally think this company is a deep value play at current prices. AHR-C - I think this is a gamble investment, a lot of hair on that one...covenant breaches, liquidity issues, earnings power, etc... MBHIP - Interesting investment. Really tough 4Q conference call by how it reads at Seeking Alpha. Some life might be there but don't like that it is non-cumulative. CDR-A - Looks like preferred dividend is safe right now. Tough sector but it appears they are able to roll over their leases and maintain a 92% occupancy rate. 1Q was tough on this sector. I am going to do more research but find this intriguing. I didn't see their debt maturing schedule, their liquidity is certainly tighter.

Hi ericd, haven't researched these particular bond funds but I have been looking at the same sector just slower to move. hard to keep up on the required research between work and a new baby. in general i think your logic is sound. The looming question is the default rate in the portfolio and the impact of liquidation on the portfolio. as a banker in this environment, the recoveries on a defaulted note are certainly not what they used to be and it is certainly taking longer to monetize recaptured assets. in general though, i am extremely bullish in both leverage bond/preferred stock investing.

Good WSJ article on the situation: "Best Check on Inflation: Broken Banks" http://online.wsj.com/article/SB123750104783789229.html * "With the Fed training a monetary fire hose on the financial system, many in currency and other markets are getting itchy about inflation. But without an effective fix for the banking sector, they are likely getting ahead of themselves. Inflation may be a monetary phenomenon, to paraphrase Milton Friedman, but money is only inflationary if it gets spent quickly. Right now, it isn't getting spent very quickly at all. [M2 money velocity, quarterly] M2 money supply, a measure of money in the system that includes time deposits, such as certificates of deposit, has grown by $767 billion, or 10%, in the past year, according to Federal Reserve data released Thursday afternoon. A separate measure compiled by the St. Louis Fed, called MZM, designed to better measure liquidity, has grown even faster, up $991 billion, or 12%, in the past year. But the velocity of money -- or the speed with which money is spent -- fell in the fourth quarter to its lowest level since 1991, as measured by the ratio of gross domestic product to M2 money supply." continued at wsj.com

I was thinking in the same boat as you. I put together a basket of preferreds that pay on the 15th of every month of the year. Most yield over 10% and have seen some great price appreciation over the past couple of weeks. However, I have decided to stay the course instead of liquidate any of the positions. Currently this is my basket/portfolio mix: CTZPRA Citizens Funding (Preferred) WFCPRL Wells Fargo & Co. (Preferred) HRPPRB HRPT Properties Trust (Preferred) LNCPRG Lincoln National Corporation (Preferred) AIVPRY Apartment Investment Mgt Company (Preferred) HRPPRD HRPT Properties Trust PRFD 'D' (Preferred) JPMPRY JP Morgan Chase Cap XI (Preferred) ORHPRA Odyssey Holdings PFD A (Preferred) I continue to look at them on a weekly basis. WSJ.COM has an excellent listing of all preferreds that you can download into excel and sort. Once sorted, I use Quantumonline.com to research specific issues. It has worked great for me. Now I just look forward to collecting my dividend on the 15th of every month! I should note that I levered my portfolio about 30% into this deal, so I have taken some substantial risk, but based on the returns if the preferreds continue to pay my payback on the debt is two years. Needless to say I am confident in this basket and the companies I have invested in. CRBC/CTZPRA is my deep value play, but my longest owned preferred as I have been building this position over the past year.

Thanks for the correction JEast. I am gathering your reasoning.

My reasoning was based on the fact that the HRP-B is redeemable at any time and has already been partially called. I don't think that that the HRP stock price is going to trade over $13.00 anytime soon, but I could see the company calling the balance of the preferred B shares within the next couple of years.

I am in HRP and its preferred HRP-B and also looking at others in the sector. I agree on the inflationary comment and I would add that I think there has been an over reaction on the ability to refinance property which has driven REITs down.

WFC-L from www.quantumonline.com SECURITY DESCRIPTION: Wells Fargo & Co., formerly Wachovia Corp. 7.50% Non-Cumulative Perpetual Convertible Class A Preferred Stock, Series L, liquidation preference $1000 per share, not redeemable at any time, and with no stated maturity. Non-cumulative distributions of 7.50% ($75.00) per annum are paid quarterly on 3/15, 6/15, 9/15 & 12/15 to holders of record on the record date which will be the last day of the month prior to the payment date (NOTE: the ex-dividend date is at least 2 business days prior to the record date). The dividends are non-cumulative and if the board of directors does not declare a dividend or the company fails to pay a dividend declared by the board for any quarterly dividend period, the holder will not be entitled to receive any dividend for that quarterly period and the undeclared or unpaid dividend will not accumulate. Dividends paid by the preferred are eligible for the 15% tax rate on dividends under normal holding restrictions and are also eligible for the dividends received deduction for corporate holders (see page S-40 of the prospectus for further information). The preferred shares are convertible any time at the holder's option into 32.0513 common shares of Wachovia Corp. (NYSE: WB), an initial conversion price of $31.20 per common share. On or after 3/15/2013, if the price of the common stock exceeds 130% of the conversion price for 20 of any 30 consecutive trading days, the company may, at their option, cause the preferred shares to be converted into common shares at the then prevailing conversion price. In regard to the payment of dividends and upon liquidation, the preferred shares rank equally with other preferreds and senior to the common shares of the company.

I think that is what you call a bank...trading fixed long rate with a short-term variable...

A good muni fund is NAD. Also HRPPRB is a good preferred stock. There are plenty of options out there.