Posts: 62
Threads: 15
Joined: Oct 2014
Reputation:
0
I'm going to initiate a position in it too. It seems like it's trading at a great price, and with a huge increase in revenue (according to Yahoo Finance), it seems like the company's negative EPS and high debt are just this new company trying to break a speed record acquiring a property portfolio that would make Realty Income blush. It all stands on whether that increased revenue will be enough to sustain future earnings growth, pay down the debt, and keep the dividend from disappearing. With property in 49 states as I understand, I should hope that they do just fine.
The big red flag against all that is their portfolio's high reliance on Red Lobster. I have a feeling they were after the properties rather than the restaurant, so all eyes on either Red Lobster to perform well, or ARCP to have a game plan to quickly and cheaply fill those properties in case Red Lobster bottoms out.
The position I initiate will be a small one. It seems like a slightly risky play, but a measured and reasonable one. It's not like it's a biotech penny stock.
Posts: 312
Threads: 25
Joined: Mar 2014
Reputation:
12
ARCP -20% on accounting issues, CFO is fired. I guess this is why you diversify.
Posts: 61
Threads: 7
Joined: Mar 2014
Reputation:
0
This being one of my larger positions really hurts. I'm anxious to see how this all plays out and I'm hopeful it's for the better...
Posts: 241
Threads: 38
Joined: Oct 2014
Reputation:
2
That's just crazy.
I'm either feeling incredibly daring or stupid at considering buying a few $100's worth 0.0.
Posts: 53
Threads: 5
Joined: Apr 2014
Reputation:
0
..and to think I was tempted to add to my position back a week ago at $11.80. Now I'm just glad that I held it in my taxable account so I can claim the loss >:/
Posts: 312
Threads: 25
Joined: Mar 2014
Reputation:
12
I'm holding, not taking a 30% loss on principal in my Roth IRA. The underlying assets and revenue stream from CVS, WAG, FDX, etc. haven't changed. The dividend payout will probably take a hit but at least I'll collect part of what used to be 8%. Meanwhile I'll keep putting those payments into other stocks, as before. Technically speaking, I have 32 years left on my investment timeframe before I can remove my principal anyway.
Posts: 2,398
Threads: 54
Joined: Jul 2013
Reputation:
35
I'm in the same boat. I hold it in an IRA and have been pooling dividends from all of my stocks for future purchases. Will probably just hold and continue to collect the dividend.
I expect it will probably be cut, but even if its halved its still more income than the capital will generate if I sell it and put the money elsewhere.
Posts: 241
Threads: 38
Joined: Oct 2014
Reputation:
2
If the debt was lower I would have pulled the trigger for a risky but potentially high reward buy.
Posts: 193
Threads: 20
Joined: Aug 2013
Reputation:
5
I'm holding as well, little over a 30% hit from my original purchase price--OUCH!
However, my appreciation in Microsoft alone has more than covered this lose. So one to one (i.e. dollar for dollar) its a wash for me. And, my overall portfolio actually in creased by almost 1% just today.
Diversification...the power to makes ones response even to this nasty news a "huh, that happened...?"
Ronn
