Author Topic: JOE up 10% today  (Read 11933 times)

Buffetteer

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JOE up 10% today
« on: February 07, 2011, 06:51:36 AM »
Anyone know why. Is it simply because B. Berkowitz will probably become the new chairman of the board? That's the only news I could dig up on the company this morning.


BargainValueHunter

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Re: JOE up 10% today
« Reply #1 on: February 07, 2011, 07:01:55 AM »
Slightly more info:

http://www.cnbc.com/id/41449101

Quote
A source close to the situation tells CNBC Berkowitz, whose mutual fund Fairholme Capital Management LLC, owns 29.7% of the company, is proposing to remove the company's chairman Hugh Durden and three other directors. Under Fairholme's proposal, Berkowitz, would become chairman and Charles Fernandez, President of Fairholme would become vice chairman of the board. Both men are current directors and plan to decline all compensation, including the reimbursement of expenses, until the company breaks even. The source said Fairholme plans to achieve this within six months by cutting $60 million dollars in expenses at St. Joe.

In addition Fairholme plans to hire a financial advisor to explore possible bolt on acquisitions and/or joint ventures for commercial and residential real estate development. A person close to the situation also said a deal to lease 41,000 acres of timberland is close to being signed and will generate between $80 million to $100 million for St. Joe over a twenty year period.  Much of the money from the deal will be paid up front, providing needed cash for acquisitions and joint ventures.

Albert Einstein called compound interest "the greatest mathematical discovery of all time".

Buffetteer

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Re: JOE up 10% today
« Reply #2 on: February 07, 2011, 07:11:42 AM »
Thanks BVH.

I'm sure all the shorts rushing to cover doesn't hurt the price either.

BargainValueHunter

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Re: JOE up 10% today
« Reply #3 on: February 07, 2011, 07:16:37 AM »
I listen when Einhorn speaks but he can come across pretty arrogant during his presentations.

Conversely, Bruce comes across as a bit dodgy and unsure of specifics during his interviews.

There is something about a not very polished long beating a slick short (at least as they look in the media) that makes me smile. :)
Albert Einstein called compound interest "the greatest mathematical discovery of all time".

Bronco

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Re: JOE up 10% today
« Reply #4 on: February 07, 2011, 07:20:16 AM »
At different points in his life, many would consider Buffett a straight up dork.

Also, humble and quirky.  So if BB shares these traits, I wouldn't be scared.


BB makes money, pure and simple.  I don't own any of his fund or Joe, but I can see the guy tries to make money for his shareholders.  Another smart investor who keeps a lot of cash.

Hmmmm....

TorontoRaptorsFan

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Re: JOE up 10% today
« Reply #5 on: February 07, 2011, 07:27:07 AM »
The only reason why he has a lot of cash is because of lot of cash is being poured into the fund by investors. And in many cases Berkowitz can only spread the money around to so many positions because in some cases he runs into issues such as the amount of shares he's entitled to purchase.
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Buffetteer

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Re: JOE up 10% today
« Reply #6 on: February 07, 2011, 07:29:35 AM »
Definitely see a lot of similarities between BB & WB. both long term value investors who eat their own cooking. They share the same risks as their shareholders and charge reasonable fees.

Big fan of both, but I'm long on Joe and other BB investments, so I may be a little biased  :)


Bronco

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Re: JOE up 10% today
« Reply #7 on: February 07, 2011, 07:35:29 AM »
Toronto Fan (you must be the one) - are you sure that is the ONLY reason.  Because he mentions others (see CNBC).

Unless, of course, you are implying he is liar.

TorontoRaptorsFan

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Re: JOE up 10% today
« Reply #8 on: February 07, 2011, 07:39:11 AM »
Look at how rapidly the AUM has scaled up over the years. There's so much money coming in he can only spend it in so many ways.
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txlaw

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Re: JOE up 10% today
« Reply #9 on: February 07, 2011, 05:15:32 PM »
Toronto Fan (you must be the one)

Haha, nice. ;D 

The only reason why he has a lot of cash is because of lot of cash is being poured into the fund by investors. And in many cases Berkowitz can only spread the money around to so many positions because in some cases he runs into issues such as the amount of shares he's entitled to purchase.

He's gonna be able to find ways to deploy that cash.  Fairholme Fund has a distressed debt component to it, and there are certainly companies out there that need to be recapitalized.