Re: H.C. run by Nazi's?
I can't abide HC for longer than about 2 minutes. But presuming what you say is correct, how many of those posts actually add something of substance as opposed to those that are like "YEEEEEEEEHHAAAAAAAAAAAAAW DOG is gone up to .000000000000000000000000000000000000000000000000000000005c or CRAP is going to the MOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOON!
???
Sure there are some of those, there is an ignore button for them. but then there are a lot of researched ones as well. Such as:
"Reply to: #4894432 from axlsusie Views: 353
Posted: 31/12/09 03:17 Stock Price (at time of posting): 16.5c Sentiment: Buy Disclosure: Stock Held From: 220.239.xxx.xxx
Great contributions by everyone on this thread. Thanks BentleighWest for initiating the thread.
Without going into the topic too much because I am a tad sleepy, but I was thinking the best way of unlocking value in CER is not through CSF IMO but a much bigger beast that nobody out of HC talk about and that is SuperLLC
I mentioned a while ago that SuperLLC for CER is like a double call option. I'll briefly explain what I mean:
SuperLLC contributes 0c NTA to CER yet generates $80m per year to the bottom line (Pg 68 anual report says $88m but lets just say $80m).
SuperLLC currently contributes zero equity to CER's accounts because CER is responsible for CNP and CMCS40's negative equity in SuperLLC to the extent of CER's investment in SuperLLC
What this means is that although CER has equity in SuperLLC of $635m not taking into account other JV investors in SuperLLC (pg 68 annual report), the negative equity enjoyed by CNP needs to be borne by CER in way of an impairment charge. This is why CER has zero equity in SuperLLC.
At the end of the day, this is accounting mumbo jumbo. If SuperLLC does not fail, which is unlikely to happen now given the stabilisation plan announced in Dec08, CER will ultimately retain its $635m equity in SuperLLC and continue to generate profits in the amount of $80m independent of the underlying profit CNP generates in the properties it holds in its SuperLLC investment.
At the moment all profits generated by SuperLLC are being used to paydown debt.
Going back to my double call option example, what I mean by this is, SuperLLC contributes 0c equity to CER. We can safely say also that the market has reflected this equity in the current unit price/market cap of CER.
When SuperLLC begins to experience property writeups, this will favourably affect CER in two ways:
- CERs stand alone equity in SuperLLC will increase from $635m
- The impairment charge that CER has taken on in the amount of $635m will be written back
Therefore, a $635m writeup in the value of CERs SuperLLC equity, will increase CERs overall equity by $1,270m ($635m x 2)
A two fold win for CER.
Yet the market is currently saying, nope SuperLLC is worthless and we aint assigning it any value
Mind you with this call option, there is no expiry date!!
No call option, let alone a double call option with an unlimited expiry date would be assigned a 0c value by the market.
Even options that are out of the money and EXPIRE at the end of next month will more likely than not be given a value. Im holding call options in ANZ (strike price $24) and WDC (strike price $13.50) that expire 28 Jan 2010 that are out of the money and I can today should I choose to realise some proceeds.
CNP has negative equity but for some peculiar reason (insert sarcasm), the share price is higher than 0c.
The best way to unlock value in CER is to list SuperLLC as a separate vehicle on the ASX IMO
I would love to buy an infinite amount of shares in SuperLLC for 0c knowing that the potential upside in nothing short of enormous.
If CER or UBS (the investment bank appointed to look after CERs interest in the separation process) is reading this, this is the ultimate way of unlocking value in CER
I do have some ideas and numbers floating though my head of how this can be done but Im off to bed now
Tomorrow is another day!
Keep the faith all
Cheers"