Welcome and I pray your week long festivities were of a convivial nature. Good food and and good friendship for you.
The year is coming to a close, and what a year it was.
With the stock market reopened, I am up a small amount for the day. The year has been well, though I find that I have merely performed the lower end of the indices this year.
So far, I am up a little over 25% for the year. An investment in the S&P would have outperformed me. It seems late for that to change now.
But I am content. I favor where I am at, and feel it will bring good blessings.
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Merry Christmas to you Cain. 25% is never anything to sneeze at, even in a big year like 2013. I underperformed as well, to which I blame my tendency to over trade. How does 2014 look for AEC in your view?
AEC is doing well. They remain off the radar, but I believe the undercurrents will bring the company to outperform over the next 5-10 years.
As of September, the company had what it approximates as $40 million in real estate projects under construction, which amounts to 3% growth through building out land.
I think you’ll see some more acquisitions come underway, although perhaps not at the ferocious pace that was occurring between 2010-2011.
Rents remain upward pressured and I think you’ll see average annual lease renewals at >+6%, on average.
Their debt situation slid a little in the last quarter, but management is on it and their debt levels are not that dangerous overall. In October, the company raised debt effectively offsetting the debt paid off from the equity raise earlier this year. That was an about face and I don’t know what it means yet. But the first impression is that something subsided and management felt they could be more aggressive.
The company remains a cash cow. Cash from operations was up about 9%, and net cash rose even after an additional $123 million into the business (excluding a $90 million rollover from sales of existing properties).
Dividends are running higher, and looking at the required sum to finance those dividends against the total cash being generated (particularly in the last quarter) there’s plenty of room to continuing raising the yield.
I expect the company to continue to raise dividends, leading to a slow, long appreciation of the share price. Eventually, the behind the scenes efforts being masked in the earnings reports will reap rewards and the shares will take off.
In the meantime, I’m making 5% annually to sit and wait.
Appreciate the in-depth analysis. I am looking for an entry.
http://explosm.net/db/files/Comics/Kris/support.png
Just for you sir Cain LOL
Dear me…
Within 40 miles of Washington DC, any house offered at 125 K or less is damaged from one or more of the following:
1. Fire
2. Mold
3. Foundation
Or the house has major issues, like a completely demolished interior, property border conflict, or too small (two rooms).
Water damage also, you get the idea.
Amazing market, though. Pretty pumped up. The higher prices brought out sellers of better properties. The low cost houses that remain are truly the worst of the worst. The serious sellers of medium priced properties are the ones selling at or slightly above assessed value. There are some “fantasy” sellers offering hum drum ordinary houses 100 K above assessed.
Thanks for the update. Appreciated