Moht Posted December 19, 2019 Share Posted December 19, 2019 New shareholder at SYTE: https://www.sec.gov/Archives/edgar/data/1096934/000178522519000001/0001785225-19-000001-index.htm Likely explains the massive jump in volume over the past 10 days or so. The Spanish fund/investor likely purchased their shares from Jeff Moore, who is now below 5%: https://www.sec.gov/Archives/edgar/data/1096934/000110465919073877/0001104659-19-073877-index.htm Link to comment Share on other sites More sharing options...
cameronfen Posted December 19, 2019 Share Posted December 19, 2019 Rename this company from Sitestar to Shitshow. I just read about 6 months of posts since the last time I checked this thread... someone said it best, this is a nerdy soap opera. It's like a bunch of kids got their hands on their parent's credit cards, bought 1000 lbs of gummy bears from amazon, and then were completely surprised when they couldn't eat it all and had throw it out. Where are the adults in the room? And does anyone actually still own any of this? I hope not, this now has years worth of red-flags all over it. I would've hoped you all sold months/years ago. And at this point I wouldn't touch any of the associated investment funds either. It's guilty by association (sorry to say). I mean, how anyone can read this stuff and not think "100% Mickey Mouse Operation" is beyond me. Totally mind blowing. I think the moral of the story is investors may think that being back seat drivers makes you qualified to run a business, but when things need to scale, it’s not just numbers working out that matters, and it’s not so easy even to be a mediocre operator. Link to comment Share on other sites More sharing options...
ratiman Posted December 19, 2019 Share Posted December 19, 2019 I've seen this "It's tough being an operator" argument a number of times. That's not the problem. The problem was that they bought assets that had no business being owned by a publicly traded microcap. Owning residential rental properties is a tough business when it's run out of your kitchen, it's impossible inside the cost structure of a public company, not to mention the lack of REIT status. The thing is, SYTE already knew this, as SYTE already had rental properties it was trying to sell in Virginia. I don't know why management thought that rental properties in Kentucky would somehow perform better than rentals in Virginia. It was a bad business in Virginia, what would suddenly change in Kentucky? So no, the problem wasn't a lack of operating experience. They just bought the wrong asset and then, amazingly, bought the same exact asset a second time, expecting magic to happen. And yes, I'm aware that it was different management teams that, incredibly, made the exact same mistake. The first management team was fired for stepping in shit and then the second management team stepped in the exact same shit. It's bonkers. Link to comment Share on other sites More sharing options...
Foreign Tuffett Posted December 20, 2019 Share Posted December 20, 2019 This has been pointed out earlier in this thread, but the core issue here is that SYTE is very small, yet quite complex. This is a bad combination for a holding company structure. Corporate level expense was ~$850K last year, and will probably be similar this year. The operating businesses and Alluvial Fund investment are going to have a difficult time offsetting this expense. I think management is moving in the right direction by attempting to simplify the company (aka repenting for past sins), but has become embroiled in this odd legal dispute with Woodmont. Link to comment Share on other sites More sharing options...
Spekulatius Posted December 22, 2019 Share Posted December 22, 2019 New shareholder at SYTE: https://www.sec.gov/Archives/edgar/data/1096934/000178522519000001/0001785225-19-000001-index.htm Likely explains the massive jump in volume over the past 10 days or so. The Spanish fund/investor likely purchased their shares from Jeff Moore, who is now below 5%: https://www.sec.gov/Archives/edgar/data/1096934/000110465919073877/0001104659-19-073877-index.htm So there is new episode in the SYTE soap opera: ”The Spaniard” Not sure what they are seeing here to take an ~8% ownership. The acquirer is a real estate company located in Spain. SYTE isn’t really a real estate company any more. Curious to see how this will work out. Link to comment Share on other sites More sharing options...
DTEJD1997 Posted December 22, 2019 Share Posted December 22, 2019 New shareholder at SYTE: https://www.sec.gov/Archives/edgar/data/1096934/000178522519000001/0001785225-19-000001-index.htm Likely explains the massive jump in volume over the past 10 days or so. The Spanish fund/investor likely purchased their shares from Jeff Moore, who is now below 5%: https://www.sec.gov/Archives/edgar/data/1096934/000110465919073877/0001104659-19-073877-index.htm So there is new episode in the SYTE soap opera: ”The Spaniard” Not sure what they are seeing here to take an ~8% ownership. The acquirer is a real estate company located in Spain. SYTE isn’t really a real estate company any more. Curious to see how this will work out. Maybe the acquiring company doesn't know that SYTE is moving out of real estate? Could also be that because they are located in Spain, they don't talk American real good. Maybe they got confused about something? Something lost in translation? Link to comment Share on other sites More sharing options...
Gregmal Posted December 22, 2019 Share Posted December 22, 2019 Or maybe, like everyone else who’s invested here, deep down, they just want a tax write off. Link to comment Share on other sites More sharing options...
stahleyp Posted January 7, 2020 Share Posted January 7, 2020 Does anyone know how SYTE's ownership interest is with regards to specific managers? I could see how it could cause some resentment if SYTE has 50% ownership vs 10% for another managers and 20% for another. Link to comment Share on other sites More sharing options...
Scunny Bunny Posted January 14, 2020 Share Posted January 14, 2020 Interview with Steve Kiel & Tobias Carlisle https://acquirersmultiple.com/2020/01/monday-ep-48-the-acquirers-podcast-steven-kiel-transition-cos-balance-sheet-to-income-statement-investing-special-situations-and-graham/ It may be a sign of what's happened with this company .... the Arquitos logo falls off the wall and smashes at 24:17 of the podcast!!!!!! Link to comment Share on other sites More sharing options...
slkiel Posted January 14, 2020 Share Posted January 14, 2020 Even better. It was actually the Willow Oak logo. Ironically, that part of the business is doing great! Link to comment Share on other sites More sharing options...
CorpRaider Posted January 14, 2020 Share Posted January 14, 2020 It was funny. Funny tweet about it as well. Also, nice job Toby by sliding on by the coinstar mix up/confusion. Link to comment Share on other sites More sharing options...
Moht Posted January 31, 2020 Share Posted January 31, 2020 Two tough years for Arquitos, down 14% in 2019 and down 31% in 2018, per his Q419 letter: https://gallery.mailchimp.com/2511717cdf1bae9a0638c942a/files/8f5f9baf-c8e2-4061-9841-c67bd803bdcc/Arquitos_Investor_Letter_Q4_2019.pdf Not saying it's going to happen, but in the event his fund faces redemptions, what happens to the illiquid SYTE shares? Do LPs take them instead of cash - and then indiscriminately sell? I've seen it happen plenty of times. And what are Arquitos' terms? I recall reading something about a 60 day lockup in a prior letter. Maybe that's changed? Fascinating set-up. Also, for those who missed it, Focused Compounding (a Willow Oak fund) just filed a 13D on Park's America: https://www.sec.gov/Archives/edgar/data/1297937/000179329120000003/0001793291-20-000003-index.htm Link to comment Share on other sites More sharing options...
5xEBITDA Posted January 31, 2020 Share Posted January 31, 2020 Wow is that letter an embarrassing read. Link to comment Share on other sites More sharing options...
slkiel Posted January 31, 2020 Share Posted January 31, 2020 Wow is that letter an embarrassing read. How so? Link to comment Share on other sites More sharing options...
5xEBITDA Posted January 31, 2020 Share Posted January 31, 2020 Wow is that letter an embarrassing read. How so? It reads as if the letter was written solely for the purpose of writing a letter to mention they now run a fund to me. I don't get the purpose..."hey we've never spoken to you, but we just bought 17% of your shares and will just be right here if you need us!" I don't know why you need a letter for that? It's very informal. Is running a podcast a competitive advantage? I don't know. If I were an LP in that fund I would expect some sort of financial analysis or commentary on why owning so much of that Company is a good idea aside from liking a park they walked through...especially when their position will take more than three years to unwind if they took up 30% of the 3M avg. volume every day to sell. Link to comment Share on other sites More sharing options...
slkiel Posted January 31, 2020 Share Posted January 31, 2020 It reads as if the letter was written solely for the purpose of writing a letter to mention they now run a fund to me. I don't get the purpose..."hey we've never spoken to you, but we just bought 17% of your shares and will just be right here if you need us!" I don't know why you need a letter for that? It's very informal. Is running a podcast a competitive advantage? I don't know. If I were an LP in that fund I would expect some sort of financial analysis or commentary on why owning so much of that Company is a good idea aside from liking a park they walked through...especially when their position will take more than three years to unwind if they took up 30% of the 3M avg. volume every day to sell. Gotcha. Point taken. I don’t think they meant the letter for public consumption. It just had to be filed with the 13D. There is some negative history with the Parks management and major shareholders, so I think they wanted to put management at ease. The letter was to management. There is separate, private communication to LPs that I’m sure more specifically addresses the investment case. Link to comment Share on other sites More sharing options...
Orchard Posted January 31, 2020 Share Posted January 31, 2020 I'm sure no one at Focused Compounding ever read Buffett's letter to WaPo. ;D Link to comment Share on other sites More sharing options...
Spekulatius Posted February 1, 2020 Share Posted February 1, 2020 I am a big fan of Focused compounding podcast, so I think it is an advantage in terms of being a great marketing tool. The letter strikes me as odd (Sorry Andrew and Geoff as I know they follow the forums here 8)). It is very humble and al, they but what is the purpose of this? Of course, I would expect being able to speak to management if I owned 17% of something. The bigger question is what are they seeing in this stock. iit May be somewhat cheap-ish,but I don’t see that much of a margin of safety there. PRKA just acquired a new business in the boonies in Texas (100 miles from Austin) for a significant part of their market cap adding a new park to their existing 2. The last acquisition in Missouri in 2008 didn’t work out. Also, they paid 20c for their open market purchases and 26c (30% more) for the bulk of their position in a privately negotiated transaction., so they paid a significant premium. How can they exit this? How permanent is their capital? If I were LP, I would be very concerned, as this stake ought to be a substantial part of their fund. Is this Yolo microcap investing? Link to comment Share on other sites More sharing options...
Gregmal Posted February 1, 2020 Share Posted February 1, 2020 While it isn't the case, it should be a given that any investor in a company with a sub $200-300M market cap should have access to management. With companies this size, it is basically standard operating procedure for the CFO to do IR. Its always an enormous red flag for me if you have a small cap company with management that has a large cap ego. Link to comment Share on other sites More sharing options...
bizaro86 Posted February 2, 2020 Share Posted February 2, 2020 I owned PRKA prior to this from when it was 15-16 cents earlier in the year. My view of management is improved significantly by their low compensation. Without looking it up I think the CEO makes $150k or less. The Missouri acquisition (and all the subsequent capital spending in Missouri, which has been significant) has basically been a debacle. That doesn't make me enthusiastic about them doing a new acquisition, especially when there aren't any disclosed metrics. I would have way preferred they sell Missouri and just pay out 100% of FCF in dividends per year, as then I could have made it a permanent hold. I'm selling, and now I need to find somewhere else for the money. I'm not complaining about the 50% gain, and maybe the focused compounding guys have more information about the acquisition than I do. If the new acquisition is doing $1MM of EBITDA or something this is still very cheap, so its entirely possible I'm very wrong about this. Link to comment Share on other sites More sharing options...
Moht Posted February 18, 2020 Share Posted February 18, 2020 $78k in board fees paid in stock to the Chairman for a sub-$10M market cap company that's down 75% over the past 15 months? Bold. Why not waive the fees? https://www.sec.gov/Archives/edgar/data/1096934/000163398620000001/0001633986-20-000001-index.htm Link to comment Share on other sites More sharing options...
Gregmal Posted February 18, 2020 Share Posted February 18, 2020 Stock comp is the new charity gesture. How grateful we should all be that the directors gets paid in free shares! I'm seeing more or more companies try to swing this bs to their shareholders that compensating the board via shares "doesnt count" because its not cash. I guess this was only the next natural progression seeing as how SBC now routinely gets excluded from G&A because, well, "its not a cash cost". My question has always been "who pays for it". Not once have any of the offending parties given the correct answer, which is, "you, the shareholder"... Link to comment Share on other sites More sharing options...
stahleyp Posted February 18, 2020 Share Posted February 18, 2020 $78k in board fees paid in stock to the Chairman for a sub-$10M market cap company that's down 75% over the past 15 months? Bold. Why not waive the fees? https://www.sec.gov/Archives/edgar/data/1096934/000163398620000001/0001633986-20-000001-index.htm Was that in addition to his current salary? Link to comment Share on other sites More sharing options...
Tim Eriksen Posted February 18, 2020 Share Posted February 18, 2020 What is also strange is the CFO received $10,000 of stock as board fees. It is very rare for a CEO or CFO to be paid board fees at the company they work for. Kiel is Executive Chairman but even his Form 4 says the share grant was in lieu of Board fees. I would think his compensation should technically be salary, although as Executive Chairman it could go either way. Or is he collecting a salary too? Is there an 8-K on his compensation? Since so much of SYTE's earnings are from the investment in Alluvial and remain in Alluvial, their earnings are frequently far greater than cash generated. The filing said the company made the decision, so it determined that issuing shares at $3.65 per share was better than paying out cash. Link to comment Share on other sites More sharing options...
Hielko Posted February 19, 2020 Share Posted February 19, 2020 According to the 2018 proxy Steven L. Kiel was making $199,766 ($78,846 in salary plus a $120,920 bonus) while they had the following line about director compensation: Directors receive $1,000 for each board and committee meeting attended up to $10,000 annually. So while the stock grant would match his regular salary it doesn't explain why it was called Board of Directors fees in the form 4. Link to comment Share on other sites More sharing options...
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