Tuesday, January 3, 2012

Bought 30 MPEL AT $9.32 as LT/Bought 100 SGL at $10.03/Bought 1 U.S. West Communications 7.5% Senior Bond Maturing 6/15/2023 at 100

Morningstar has a list of 17 Scary Numbers released in the 4th quarter. 

According to the WSJ, Bridgewater Associates believes that interest rates will be locked near zero for years in both the U.S. and Europe.

China PMI was to a 50.3 reading in December, higher than the consensus estimate.

1. Bought 1 U.S. West Communications 7.5% Senior Bond Maturing 6/15/2023 at 100 Last Friday (see Disclaimer):  Based on a series of acquisitions occurring after the issuance of this bond, U.S. West Communications is part of CenturyLink (CTL). U.S. West Communications, formerly one of the Baby Bells, was merged into Qwest Communications International in 2000, and then Qwest was acquired by CTL earlier this year. 

CenturyLink Inc (CTL) Profile Page at Reuters 
CenturyLink Inc (CTL) Key Developments Page at Reuters

The current consensus E.P.S estimate for 2012 is $2.6. CTL Analyst Estimates

This is a link to the FINRA Information on this bond. According to FINRA, it is rated at the lowest tier of investment grade by the three rating agencies (Baa3 by Moody's, BBB- by both Fitch and S & P. 

The bond was originally issued in 1993, and is consequently not available with an Edgar SEC search. The FINRA information indicates that it is continuously callable now. 

2. Bought 30 MPEL at $9.32 Last Friday (Lottery Ticket Strategy)(see Disclaimer):  This is my second purchase of Melco (MPEL) as a Lottery Ticket. Bought 40 MPEL at $7.36 (January 2011)-Sold MPEL at 11.46 (June 2011):

For this kind of inconsequential investment, I did not conduct much research. I did review the Morningstar report on this company, available to subscribers. The report was generally favorable.  The analyst has a 4 star rating on MPEL with a $17 fair value estimate and a consider to buy target at $8.5 or below.  Morningstar

MPEL owns and operates casinos in Macau. (profile page of Melco Crown Entertainment at Reuters). It is one of the six companies licensed to operate casinos in Macau.

Melco Crown Entertainment key developments page.

The last filed Form 6-K, providing financial information, can be accessed at the SEC. Condensed Consolidated Financial Statements and Reconciliations Form 6-K is filed by foreign issuers of securities traded in the U.S.

The press release announcing the last quarter's earnings can be accessed at the SEC.

The current consensus E.P.S. estimate is for $.59 in 2012, up from $.49 in 2011. MPEL Analyst Estimates The estimated five year P.E.G. is .35. Price to sales is around 1.43.  MPEL Key Statistics The company recently estimated that industry revenue growth in Macau to slow to about 15% to 20% this year. Bloomberg

3. Bought 100 SGL at $10.03 Last Friday-Regular IRA (see Disclaimer): SGL is a closed end fund that invests in bonds worldwide. As of 5/31/11, 47.5% of the portfolio was weighted with bonds priced in USDs, and the rating characteristics of the portfolio at that time were as follow:

Since the fund is actively managed the weighting will of course vary and the forgoing is just a snapshot in time.

This is a link to the last SEC filed shareholder report for the period ending 5/31/2011.  www.sec.gov

The last filed Form N-Q, which contains the fund's holdings as of 8/31/2011, cab be found at  www.sec.gov.

Morningstar page on SGL. 

If realized, the fund will generally pay out in December any realized short and long term capital gains. SGL recently went ex dividend for a long term capital gain distribution of $.2687 per share and a $.0188 per share in a short term capital gains distribution.  Distribution Declarations and Updated Price & Distribution Rate Information As noted in the foregoing press release, this fund makes monthly distributions at an annualized rate equal to 6% of the fund's net asset value, as calculated in the matter set forth in that release.

UBS is the sponsor of this CEF.  UBS Closed-end Funds

Strategic Global Income Fund closed at $10.17 last Friday. As of 12/30/2011, the net asset value per share was at $11.18, creating a discount to net asset value of -9.03 based on last Friday's closing price. 

No comments:

Post a Comment