With the shareprice having taken a tumble over the past 48 hours due to concerns about refinancing their short term debt for the US investments, is it worth taking a punt on CPT on the prospect that they are able to refinance in 2 months time by the deadline) and stand to make a killing on the increase in the shareprice?
Have been trading around $0.78c.
My feeling is that since they are only geared at 70-80% of val, with the sale of some of the recent acquisitions (even as a distressed sale) this will improve the LVR and asset backing ratio.
Should I borrow $50k and put my own $50k into the equation on the prospect of a 50-200% capital gain over 3-6 months (say a return of between $50-200k on the $50k of my own capital).
Thanks
Mmmmm. CHeck out RAMS and you may find that is not such a great idea. They have been quite clear with the statements released to shareholders that the chances of being successful with this type of short term debt are highly unlikely at anytime in the near future, so I could not envisage Centro faring any better…….but who knows. Is it speculating or gambling?
My opinion only of course.
CheersUnlike RAMS, which sold off the most profitable part of its business to Westpac, Westpoint (and the other developers) – Centro has 70% of its investors are Major Players in the property/investment markets ie ANZ, UBS, Citibank, AMP, National, HSBC, JP Morgan & QIC.
It is not in any of these investors interests to see the company fail or $ wiped off their investments – give it a week and there will be an array of buyouts – SMH notes tahat the vultures are already circling.
CER up 17% in the first 5 minutes of the open.
Richard Taylor | Australia's leading private lender
Scott No Mates wrote:With the shareprice having taken a tumble over the past 48 hours due to concerns about refinancing their short term debt for the US investments, is it worth taking a punt on CPT on the prospect that they are able to refinance in 2 months time by the deadline) and stand to make a killing on the increase in the shareprice?Did you make that play, Scott No Mates? If you did, then wow, CNP up 44% to $1.16 currently… you'd have made nearly $50k already! All they need now is a bit of good news, and… well, we'll see!
F. [cowboy2]
Laughing – just walked off with about $60K on top of my $50k. Waiting on the final numbers. Thank goodness for etrade.
wow, congratulations !!!! and I still havent opened a trading account ,damnit
Scott No Mates wrote:Laughing – just walked off with about $60K on top of my $50k. Waiting on the final numbers. Thank goodness for etrade.Great work mate,… Goes to show when you are quick to spot a market over reaction to can make some beans,….
I was looking at the centro situation but I didn't make a move,…. you snooze you lose I guess.
wow, congratulations !!!! and I still havent opened a trading account damnit
Put it this way, there looks to be more of an upside if you are prepared to wait – an asx announcement this morning helped their outlook.
If you seriously think about it, what are their assets? What is the quality of the assets? How much debt are they carrying? What is the nature of most of their debt (long term vs short term)? it is only the short term debt which seems to be a problem however on trading volumes only the small players are getting out the big ones have not made any ASX statements other than those who have had a stop loss position – very sensible players.
We are all in the property game, so have a look at their annual reports (online), weigh up their wacc, your risk profile and use your line of credit if you are game. After all if you lose, it is a capital loss to be offset on cgt, a profit will otherwise be all good.
Scott No Mates wrote:Laughing – just walked off with about $60K on top of my $50k. Waiting on the final numbers. Thank goodness for etrade.When you can keep a clear head and make deceisions based on rational thinking and facts, you will always profit from others who are panicing and franticly dumping good stocks and crazy prices.
Must admit i bailed at 1.19 but with a high of 149.5 there was some nice money made today.
That and shorting Westpac last night was a nice little earner as we say.
Richard Taylor | Australia's leading private lender
I didn't take the punt as I wasn't prepared to take on the risk and didn't have spare cash. I did a similar punt on macquarie bank when the credit squeeze occurred in october 2007 but on a smaller scale and made $800 in less than a month.
Just tossing up about using some of the windfall as a buy and hold – fundamentals still seem OK due to the asset backing (even after allowing for the level of debt). As for the vultures, Westfield, although they haven't shown any interest, would be barred from further investment in NSW by the ACCC, they might have some luck with The Glen and buy back Toombul which they sold a couple of years ago to raise funds for some puchases/redevelopment works elsewhere. They also have the major redevelopment of the Sydney CBD to kick off next year and this will be a draw on funding.
Most of Centro's assets otherwise would be too small for W, so other players QIC (who already have some exposure to Centro), GPT, Abacus etc may be waiting in the wings.
Two outcomes that I have seen is the possibility of taking on a JV partner for some sites or offering equity to a JV which will dilute the current share value.
On the upside, eps , once the dust settles, will be great at these prices.
I hold a block of westfield stock, westfield is my pick in this sector for a long position.
I should have picked them at at $13-$15 back in 2000 when I was in the know
Essentially a very tightly run ship, lease/tenant management is the toughest that I have ever seen. Very knowledgeable crew. Cashflow budgetting/modelling is extremely sophisticated (you'd sort of expect that).They are one of the few companies which have been able to pay an increased dividend for every year of operation. I'd agree with you TB, they are a long term good cashflow holding.
Essentially a very tightly run ship, lease/tenant management is the toughest that I have ever seen. Very knowledgeable crew. Cashflow budgetting/modelling is extremely sophisticated (you'd sort of expect that).You must be logged in to reply to this topic. If you don't have an account, you can register here.
