Williams406 Posted August 2, 2018 Share Posted August 2, 2018 Can't believe it's trading at $67 now. The Bakers and the CFO, John Milton Jr are definitely one of the best and most rational management teams that I have encountered during my investing career. BG2008, do you mean $67 seems high or low? Agreed on management quality. I put decent capital in to this one at $30, but wish I had the assessment of management quality then that I do today. Link to comment Share on other sites More sharing options...
BG2008 Posted August 2, 2018 Share Posted August 2, 2018 Will, I've sold all of my shares. Management team attended a conference in late 2017 and when asked what they think the NAV was, they bluntly said, it's worth a 6 or 7 handle. You can decipher what the discount to NAV is. I spoke with management quite a bit early on and always felt that they were good capital allocator. The REIT conversion and sale to Blackstone exceeded my expectation. I wasn't surprised because they did sell Florida Rock a decade ago. My feel is that if management is telling you that the NAV is worth $60 or $70, $67 is a very good price to take chips off the table. What makes them attractive at $30 also makes them not as attractive when at $67, you are relying on them to compound capital going forward. Due to the lack of leverage and overly cashed position, I think they compound at mid single digits and at best high single digits. When there's minimal delta between NAV and price, you have to pay more attention to growth rate of NAV over time. I think there are more interesting things in the market today. Probably fine holding it if you've got way too much cash. Link to comment Share on other sites More sharing options...
Gregmal Posted October 10, 2018 Share Posted October 10, 2018 Thought I'd bump this. Came back $10 for no apparent reason. It's interesting and on the radar here; I'll probably dabble/add a little bit, but not no brainer cheap. Another 10% decline though, and....welcome back to the top 5. Link to comment Share on other sites More sharing options...
Williams406 Posted October 10, 2018 Share Posted October 10, 2018 The South is getting a little rain. If the quarries fill with water, FRP will have to settle for the minimum royalty payments...severe hardship. As you and BG2008 have both mentioned, the proposition here has changed a lot from the $30's. Then, you could make a decent case the non-DC real estate portfolio was worth the stock price and the royalty/development assets were free or very cheap. Now, you have potentially very valuable optionality with the cash, but that is a different thing. Healthy position for me and I'm not quite seeing my margin of safety so I'm not buying yet either. Link to comment Share on other sites More sharing options...
Gregmal Posted October 16, 2018 Share Posted October 16, 2018 Added a small amount under $53 today. I was thinking about this and considered some of the discussion, particular that of BG. What's important I think is that the reasons for selling higher are now reason to buy lower. With the warehouse sale, yes, the NAV can't grow as fast. There is cash drag and other issues that hamper the internal ability to grow/compound. But, in the same context, you also now have a much higher margin of safety at lower prices. If we call this $70, as we have prior, then at $52 you've got 35% upside with some pretty awesome free call options and a first rate management team. When you adjust for risk, and all the dry powder you have here, I have trouble finding things that fit those criteria better. Link to comment Share on other sites More sharing options...
Williams406 Posted November 8, 2018 Share Posted November 8, 2018 FRP 3Q Call Transcript: https://finance.yahoo.com/news/edited-transcript-frph-earnings-conference-055948576.html Comments on real-estate development projects by David deVilliers: "These aforementioned projects will utilize approximately $128 million of equity over the next several years, including $38 million for the committed projects and $90 million for those that are in the letters of intent stage and subject to continued due diligence." For now, it looks like they are deploying quite a bit of capital toward RE development. Not that surprising given I doubt good aggregate properties hit the market all that often. Link to comment Share on other sites More sharing options...
Gregmal Posted December 7, 2018 Share Posted December 7, 2018 This has gotten very interesting again. Different situation than before but now you more or less have what I consider a partial SPAC, with "other" assets that I think are unique, well managed, and poised to do well in any type of economic scenario. I believe they've already said if they can't find anything to buy they will just do a special dividend. I added more this morning. Back into top 5 for FRP! Link to comment Share on other sites More sharing options...
Spekulatius Posted December 8, 2018 Share Posted December 8, 2018 I started a position as well, basically riding BG2008‘s coattails here. I think it is at least an 80c on the dollar type of valuation and with a good management team in place, that is cheap enough, IMO. Link to comment Share on other sites More sharing options...
thepupil Posted December 8, 2018 Share Posted December 8, 2018 Bought back in yesterday as well...in significant size. $45 / share with NAV of $60+ Cash Rich (though this will change as they deploy) Virtually Unlevered (all debt at Dock79) Good people (note that way upthread I dismissed the management after a cursory look, glad to have changed my mind, with significant help from others like Bill, and made 95% on the first trade from L-M$30's to H$50's) My only concern is I don't have as high conviction on them doing development where they aren't using legacy land. For example the Bryant Street* development seems like a project where they are just commodity investor capital (any institutional investor could do that). Now I understand they're partnering with MRP, the same folks who did Dock79 and that the Opportunity Zone gives them a very nice tax incentive to do it, it just seems like less of a slam dunk than contributing low basis land and a little cash in SE Waterfront next to the ballpark. Feels a bit more dramatic of a bet on the continued gentrification/stability of heretofore dicey parts of DC. Take a Google streetview walk around that area (I could also get off my ass and take a metro ride there, but I haven't done so yet). Ultimately, I trust management and it will probably work out well. The rock pits and other assets give you a little breathing room on the more risky development stuff they're doing on a go-forward basis. *At the end of this quarter, the Company signed a Letter of Intent to enter into a joint venture agreement with MidAtlantic Realty Partners (MRP) for the development of the first phase of a multifamily, mixed-use development in northeast Washington, DC known as “Bryant Street.” FRP plans to contribute to the joint venture $35 million in common equity and another $20-25 million in preferred equity. Link to comment Share on other sites More sharing options...
Gregmal Posted December 8, 2018 Share Posted December 8, 2018 I think another pretty neat way to look at this is as follows; Back a year ago or whatever, when we were pretty much sitting around these same levels... had everyone plugged the ~$360M warehouse sale figure into your NAV calcs, what would have been your thoughts? First thought would probably be, that's too optimistic. Link to comment Share on other sites More sharing options...
Spekulatius Posted December 9, 2018 Share Posted December 9, 2018 I think another pretty neat way to look at this is as follows; Back a year ago or whatever, when we were pretty much sitting around these same levels... had everyone plugged the ~$360M warehouse sale figure into your NAV calcs, what would have been your thoughts? First thought would probably be, that's too optimistic. Yes, that is correct. I would have given the warehouses a valuation of less than $280M for sure. They have created nice value with the sale there. Link to comment Share on other sites More sharing options...
Williams406 Posted December 9, 2018 Share Posted December 9, 2018 Thepupil, Your point regarding FRP providing "commoditized" RE development financing captures my concern. I'm curious to know if those of you buying here would buy more or less aggressively if FRP was sitting on the proceeds. I bought a bit more H40's and think it will be tough to lose money long term here. Also regard DC as a very unique MSA so I don't hate the announced projects thus far. I just note they are different than what FRP has done in the past. Link to comment Share on other sites More sharing options...
Gregmal Posted December 9, 2018 Share Posted December 9, 2018 It might sound simple, but it's kind of a non factor for me. Here's why. There are plenty of examples I am sure we can all relate to, where we've observed a combination of: businesses we like with managements we dont produce surprising results that were good. Businesses we like, with management groups we like, produce bad results. So taking this into consideration, I am more inclined to base my confidence on the track record of the Bakers and their extreme consideration for creating per share value, rather than my confidence/understanding/2 cents on what they are doing to get there. That is not to say one should never care/question the above, but it isn't as though these guys are betting the ranch on anything crazy. They've shown me they are very serious about not making a bad decision with this capital, and as such, I think if they've identified something that they deem worthy, I say, go get em boys. There's plenty of businesses both public and private run by great, knowledgeable people, whom operate in businesses outside of my circle of competence, that I'd happily give some money to. Investing in great people is IMO equally as important as investing in a great business. It's important to let great minds just do their thing without interference or second guessing. I think this is one of Buffett's bigger themes too when you look at how he handles acquired companies. Link to comment Share on other sites More sharing options...
BG2008 Posted December 19, 2018 Share Posted December 19, 2018 Somebody fat figured the trade earlier today Link to comment Share on other sites More sharing options...
mjm Posted December 19, 2018 Share Posted December 19, 2018 see 626 shares at 41.51. will teach someone not to do a market order Link to comment Share on other sites More sharing options...
Williams406 Posted March 7, 2019 Share Posted March 7, 2019 $188m in cash/investments, gross of $88m Dock 79 debt. Repurchased 121k shares at average price of $47.06, or about $5.7 million. Nothing dramatic in the release or call, but the share repurchase is at least a reference point for management valuation views and allocation choices. Link to comment Share on other sites More sharing options...
Williams406 Posted April 11, 2019 Share Posted April 11, 2019 http://frpholdings.com/investor-relations.html Click on the link "Spring Investor Summit Conference Webcast" (basic registration required/name, e-mail) for a solid overview of FRP with good detail on development projects and developable land. Link to comment Share on other sites More sharing options...
Williams406 Posted May 6, 2019 Share Posted May 6, 2019 I haven't caught the earnings call replay yet, but does it strike anyone else as odd that the company does a press release announcing Milton's retirement from CFO (he IS staying on in a couple other roles) immediately before an earnings call? Timing seems weird. Link to comment Share on other sites More sharing options...
mjm Posted May 30, 2019 Share Posted May 30, 2019 WSJ article today on cooling warehouse market. good timing I would say Link to comment Share on other sites More sharing options...
thepupil Posted June 28, 2019 Share Posted June 28, 2019 a nice powerlift of the stock into the close to end the quarter for a random up 12% day. Link to comment Share on other sites More sharing options...
Williams406 Posted June 28, 2019 Share Posted June 28, 2019 Nice couple of days. I wish it had hit my $45 target just before running to $55. I own a bunch of FRPH so I'm happy. But I'd be happier with double the position. Link to comment Share on other sites More sharing options...
Spekulatius Posted June 28, 2019 Share Posted June 28, 2019 a nice powerlift of the stock into the close to end the quarter for a random up 12% day. Somebody needed a lift in portfolio value for the end of the quarter and he found a way to get it. You sometimes see strange thing with thinly traded stocks at the end of a quarter both ways. Link to comment Share on other sites More sharing options...
BG2008 Posted June 29, 2019 Share Posted June 29, 2019 The $60 was only like 400 shares. Someone either fat fingered that or more likely tried to print a good price. Link to comment Share on other sites More sharing options...
Williams406 Posted September 23, 2019 Share Posted September 23, 2019 New FRP presentation. Includes some basic royalty lands valuation using Martin Marietta and Vulcan as comps I don't recall seeing from FRP before. http://frpholdings.com/assets/presentations/Sept_2019_investor_presentation.pdf Link to comment Share on other sites More sharing options...
Gregmal Posted February 3, 2020 Share Posted February 3, 2020 I buy when they buy has been a useful strategy for me with FRP at these prices. Buyback prices have been 47-48 IIRC. Unfortunately now, the shares have a 2015 b.c.(before Chen) type spread. Few safer securities at these levels than this one IMO. Link to comment Share on other sites More sharing options...
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