UnThreaded | Threaded | Whole Thread (3) | Ignore Thread Prev | Next
Author: Hohum777 Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 1828  
Subject: Re: Musing on JF Date: 10/8/2012 12:54 AM
Post New | Post Reply | Reply Later | Create Poll Report this Post | Recommend it!
Recommendations: 1
There had been a few items that were a continuation of that post. Course, I've now forgotten
what those were-

Note to SELF: Post a sentence or mention an issue so it jogs the memory in the future.

Anyways, I should continue with new thoughts. The OP was about three weeks ago, and I
did trim the Roth stake. I blundered on SFL in Dec 2011, but 80% gains in less than 10 months
more than makes up for that. An additional bonus is that SFL has since pulled back about
12-15% since then. Since the OP, SFL have also announced a secondary offering, so there's
another temporary cause for downward price pressure.

About that, suppose its 7M shares with over-allotment, @ $16-ish, would be about $102M. In the
scheme of things, that's not a whole lot for vessel expansion. Sure, it could cover the
down-payment on a few vessels. But if FRNT is JF's tanker consolidation entity, I seriously
doubt SFL would also be pursuing new tanker vessels. The again, SFL is the catch-all JF
entity that supports other JF companies. Since FRNT is multiple sub-sectors of tankers
i.e. crude, product & LPG, I suppose it is still a possibility for a tanker purchase, but
have those vessels eventually be managed by FRNT. For instance, I read somewhere that FRNT
had recently exercised some (all??) of the LPG options.

The suddenness of the share offering kinda puzzles me. Perhaps there's a distressed sale
opportunity that has come up? But SFL was already sitting on a cash-pile, more than
was raised in the offering. So another possibility is that perhaps JF wants to shore up
the SFL dividend. One way to do this would be to add another UDW drilling asset as an
off-Balance Sheet item similar to the current three. Okay, but which one? An asset in the
recent BP-related contract? Well, one's an existing UDW asset, and the other two are newbuilds
with delivery dates in the second half of 2013. While a possibility, it isn't SDRL's style
to arrange financing that far in advance.

Completed a review of GLNG--
http://boards.fool.com/revisiting-glng-in-2012-30304879.aspx...

Now that I have lightened my JF stake in both SFL and FRO, I feel too light in my JF
holdings. GLNG is a possibility, though it is a little on the higher side of where I
would like to start a position. Can the GLNG price take off? Well, if they announced a
mid-term charter with a healthy charter rate on one of the newbuilds- maybe. Another FSRU
deal might also provide a small pop. GLNG has been slowly pulling back- split the
difference and wait for $35-ish?

--
NOTE: FRNT item
Post New | Post Reply | Reply Later | Create Poll Report this Post | Recommend it!
Print the post  
UnThreaded | Threaded | Whole Thread (3) | Ignore Thread Prev | Next

Announcements

Foolanthropy 2014!
By working with young, first-time moms, Nurse-Family Partnership is able to truly change lives – for generations to come.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Post of the Day:
Macro Economics

Looking at Currency Ratios
What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
Community Home
Speak Your Mind, Start Your Blog, Rate Your Stocks

Community Team Fools - who are those TMF's?
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and "#1 Media Company to Work For" (BusinessInsider 2011)! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.
Advertisement