Saturday, June 12, 2010

Heart Healthy: Garlic - Super Food!!


Heart Disease, Diabetes, Alzheimer's disease, Flue all have one solution "Raw Garlic" (I know it is too simplistic but then that's the fact of life..)
"The most important things in life are Free: Air, Sunlight and Water!!"

Let us start from the Nobel prize in Medicine in the year 1998 presented to 3 doctors for discovering Nitric Oxide and its role in human health. The 3 doctors are: Robert Furchgott, Louis Ignarro, Ferid Murad.

What they observed is that the human body produces Nitric Oxide as a signalling molecule in cardiovascular systems. It helps in regulating the flow of blood to specific areas of our body. As we all know heart attack, stroke, Alzheimer's disease all are due to faulty blood flow levels when we need the most.

The most popular well know (Nitric Oxide) pharma product is Viagra which is nothing but targeted blood flow to specific parts of our body by producing Nitric Oxide. Right now the race is on by the pharma giants to produce a pill to target nitric oxide to specific parts of our body..

Nitric Oxide precursor is  L-arginine
L-arginine precursor is L-Citrulline
L-Citrulline is available in Raw Garlic and Raw Onions.

- endothelial cells of arteries makes nitric oxide..
- when you exercise nitric oxide is produced by arteries in the endothelial cells (that is why exercise is good for the heart)
- Nitric Oxide is the best vassal dilator
==> widens the blood vessels ..increasing blood flow throughout the body
==> Soften the blood vessels ..reversing the hardening of arteries
==> Relax the blood vessels ..help to overcome high blood pressure
==> Nitric Oxide also inhibits and melts away plaque formation ..prevent and reverse atherosclerosis, coronary artery disease, heart attack, stroke, impotence, peripheral artery disease..
- Diabetes problem also can be solved as L-arginine helps in production of more insuline.

As in nature the best things are free!! but in real life the best things are most expensive!! Well that's because nature is not looking for a profit margin.
So here we have it .. the best natural medicine to have is raw garlic (with water) 3 times a day.
You can see some observations:
1. You will be more energetic.. (if you find yourself out of energy before starting garlic in your diet)
2. Your blood pressure will be down (if you have high blood pressure before starting garlic in your diet)
3. You will also observe that your breathlessness while climbing stairs will reduce (Stress on heart when you exert additional pressure before starting garlic in your diet)
4. You will have the Viagra effect !! (If you do face any problems in bed .. before starting garlic in diet)
5. You will be less susceptible to allergies and viruses (flue et cetera)
6. Loose fat and develop more muscles (you will have to do some exercise to build muscles but fat will be chewed by Garlic without any effort will take time though)


Take raw garlic ..4 pieces every time & chew it .. gulp it down with water 3 times a day and within 3 weeks you will see a different you. Tell me about it!! Raw unwashed Onion also helps .. but RAW Garlic is the best.

Please Note: This is my free advise.. I have old parents and I was looking for more info on heart and blood glucose problem and move them away from the medicine cycle.. As always please do your own deep dive.

Dr Ignarro Interview1 (youtube)
Dr Ignarro Interview2 (youtube)
Dr Ignarro Interview3 (youtube)

Tuesday, February 2, 2010

SRZ: Multibagger: Ripe for Picking


Sunrise Senior Living (SRZ) CMP: 3.02 Market Cap: 155.62 Million

SRZ is a stock that has been extensively written about in this blog. It was in Dec 19,2008 when SRZ was quoting at 1.36 USD with Market Cap of 69.61 million that this blog was started with the intention to share the find of a precious gem of a company selling for the price of a pebble.

SRZ stock has since then seen lows of 0.30 (30 cents) and a high of 5.89 and currently quotes at approximately 3USD Market Cap: 155.62 million

My take on SRZ is that the company has had in the past 1 year made major positive changes and the stock is poised to really deliver great results for investors this year.

Consider these numbers after the 21 community sale to BKD. (Pro Forma Sept30,2009)
Cash & Cash Equivalents: 53.207 million
Current Maturities of Debt (Short Term Debt): 222.52 million
Debt, less current Maturities (Long Term debt): NIL


1. Cash & Cash Equivalents which now stands at 53.207 million.
2. Current Maturities of Debt: This is short term debt : 222.52 million.
3. Debt, less current Maturities: This is long term debt: NIL

The LINK to the Original SEC filing.

So we can safely conclude that SRZ has got itself to a very comfortable position. Yes hard decisions have been made to sell assets. But with 1.5 Billion of annual sales SRZ is still one of the largest listed Assisted Living companies in US. The loans on SRZ's books are down to manageable levels and baby boomers are waiting to retire.

We also have recent SEC filings by SRZ with regards to Fidelity Management & Research LLC intentions of taking upto 14.9% stake in SRZ. LINK

SRZ had in Sept 2009 had an SEC filing which disclosed 5 groups holding 45% stake in SRZ. (Blog Link)Add 15% stake by Fidelity Management & Research thats 60% of Equity in the hands of Long Term "Strong Hands"

Conclusion: If you have not yet invested in SRZ you need to take some time to deep dive (this blog is a good place to start) and "GET IN". Looks like SRZ is all set to be the story of the year 2010.  Happy Investing and Happy New Decade!!

Saturday, January 2, 2010

Stem Cells: Hello ACTC


Folks Biotime BTIM was recommended when BTIM was an Over the Counter stock at a stock price of 2.05USD on May 11,2009. BTIM had hit a high of 6.94 USD and at present quoting at USD 4.28 USD. Dec 15,2009 we have made more than 100% profit even after a stock dilution.

ACTC is the choice for now for ACTC has strong technical background to stand on and is a better stock to invest in.
==================================
Ticker Symbol: ACTC.ob (ACTC)
Company Name: Advanced Cell Technology.
Current Market Price: 0.092 USD (thats 9.2 cents per share)
Current Market Capitalization: 56.48 million USD.

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Here are some points worth considering:

- ACTC  owns or has exclusive licenses to 380 patents and patent applications world wide in the field of regenerative medicine and stem cell therapy.
- Companies have licensed patents from ACTC (including BTIM) and have started further research in the specific areas.
- ACTC has filed IND (Investigative New Drug) with FDA for RPE ( Retinal Pigment Epithelium) approval expected in Q1 2010

Here is the cronological list of development for ACTC:
- ACTC in 1997 announced agreement with Genzyme Transgenics to produce human theraputic proteins in the milk of cloned transgenic cattle.

- ACTC in 1999 receives broad US patent covering an improved method of cloning non-human mammals using nuclear transfer technology this has broad utility for numerous applications in human therapeutics and agriculture

- ACTC in 2000 achieved the reversal of cell aging. The company’s breakthrough may be the path to successful use of therapeutic cloning techniques to cure some of humankind’s most intransigent age-related and degenerative diseases such as Parkinson’s, Alzheimer’s and diabetes, as well as heart, liver and kidney disease.

- ACTC in Oct 2000 achieved first successive cloning of an endangered animal to "late stage" fetal development. On Jan 2001 the baby bull gaur was born. Baby Noah died within 48 hours of being born of common dysentery.

- ACTC in Oct 2001 received a grant of 1.8 million from the National Institute of Standards and Technology by Advanced Technology Program (ATP) for research on Transdifferentiation of Adult Somatic Cells for regenerative medicine and cell therapy.

- ACTC in Nov 2001 reported its proprietary cloning technology has been used to produce healthy and normal adult animals.

- ACTC in April 2002 announced the license of animal cloning technology to Immerge BioTherapeutics, Inc. of Charlestown, MA. The worldwide nonexclusive license will cover Immerge’s work in the development of genetically modified pigs for potential use in xenotransplantation (the use of animal organs to address human health issues).

- ACTC in April 2002 announced license of animal cloning technology with PPL theraputics.

- ACTC in march 2003 reported that the cloning patent dispute with Infigen has been awarded in ACTC's favour. ACTC has licensed its cloning patents to Cyagra, PPL Theraputics, Roslin, Immerge biotheraputics, GTC Biotheraputics,

- ACTC in March 2005 reported the first derivation of human embryonic stem cells in completely feeder-layer-free and serum-free conditions. To-date, all human embryonic stem cell lines have been isolated in contact with either mouse or human cells that may have contaminated the stem cells with viruses or other pathogens. “The ability to generate embryonic stem cells without exposure to living cells or serum solves a major problem associated with the use of these cells in future medical therapies,” said Robert Lanza,

- ACTC in MAy 2005 reported that it has entered into two separate agreements to expand its portfolio of intellectual property in regard to somatic cell nuclear transfer (SCNT) and cellular reprogramming.

- ACTC in July 2005 reported that Robert Lanza testified today before the Senate Subcommittee on Labor, Health and Human Services, Education, and Related Agencies, of the Committee on Appropriations. Dr. Lanza’s testimony focused on two approaches to creating pluripotent stem cell lines – that of single cell biopsy of embryos and the dedifferentiation of somatic cells back to pluripotency – and strongly encouraged support for the Stem Cell Research Enhancement Act of 2005.

- ACTC in July 2005 Announced it has entered into a research collaboration agreement with the The Burnham Institute, a California based non-profit medical research institution, to conduct research that aims to isolate stem cell specific differentiation markers.

- ACTC in Sept 2005 raises 17.75 million through private placement of warrants and convertible notes.

- ACTC in Oct 2005 reported alternative approach to the generation of embryonic stem cell lines that does not interfere with the developmental potential of embryos.

- ACTC in April 2006 announced exclusive license of key Intellectual property portfolio on Somatic Cell Reporgramming with TranXenoGen Inc.

- ACTC in April 2006 announced collaboration with Xgene Corporation. The goal of the collaboration is to test the functionality of embryonic skin cells in regenerating skin for numerous applications in medicine.

- ACTC in May 2006 announced cross license of Key Intellectual Property with Kirin Brewery Company.

- ACTC in May 2006 announces key theraputic programs: Retinal Pigment Epithelium, Hemangioplast Program and Dermal Program.

- ACTC in August 2006 announces proposed financing for 11.29 million through convertible debentures and warrants.

- ACTC in August 2006 had successfully generated human embryonic stem cells using an approach that does not destroy the developmental potential of embryos.

- ACTC in Sept 2006 announced it has settled its patent dispute involving certain nuclear transfer cloning patents with Roslin Institute, Geron Corporation & Start Licensing. ACT retained its rights under the UMass patents in the human field.

- ACTC in Sept 2006 announced an agreement to collaborate with WiCell Research Institute to jointly distribute to US scientists a range of new cell lines for medical research.

- ACTC in Sept 2006 announced that company scientists and their collaborators rescued visual function in rats through implantation of retinal pigment epithelial cells (RPE) derived from human embryonic stem (hES) cells.

- ACTC in Sept 2006 announced that Dr Robert Lanza will address the National Academy of sciences to explore the latest development in embryonic stem cell science and policy.

- ACTC in Jan 2008 announced receipt of research grant from the National Institute of Health in the amount of 204,439 in conjunction with a research project currently underway with one of its academic partners, The Burnham Institute of Medical Research (Burnham Institue)

- ACTC in Feb 2007 announces collaboration with the Casey Eye Institute at Oregon Health and Science University to conduct pre-clinical studies for its Retinal Pigment Epithelium (RPE) program.

- ACTC in Feb 2007 announced the acquisition of Intellectual Property Assets of Infigen Inc(former competitor) 26 issued patents and numerous pending patent applications. IP related to Somatic cell nuclear transplant , parthenogenesis, and other related technologies for a combination of cash and shares of common stock. The acquisition provides ACTC with exclusive ownership rights to critical technologies in regenerative medicine and the merger of assets is expected to strengthen ACTC’s intellectual property position in the drive towards commercialization of embryonic stem cell and SCNT technology

- ACTC in March 2007 announced preclinical studies using hESC (human Embryonic Stem Cells) derived from ACTC proprietary ACTCellerate technology to determine if hESC are safe and effective in animal models for heart attacks and heart failure.

- ACTC in May 2007 announced an expanded non-exclusive commercial agreement with Wisconsin Alumni Research Foundation (WARF) The expanded agreement grants ACTC rights to commercial use of human embryonic stem cells (hESCs) to develop human therapies, with the exception of neuronal, pancreatic beta cells, and cardiac applications, and enables the marketing of a broad array of research products. This agreement bolsters Advanced Cell’s existing patent estate which currently consists of over 380 owned or licensed patents and patent applications worldwide by granting commercial access to an additional 150 important stem cell technology patents and patent applications.

- ACTC in May 2007 announced that hemangioblast precursor cells derived from human embryonic stem (hES) cells can be used to achieve vascular repair.ACTC describes an efficient method for generating large numbers of bipotential progenitors—known as hemangioblasts—from hES cells that are capable of differentiating into blood vessels, as well as into all blood and immune cell lineages.

- ACTC in May 2007 announced letter of intent to acquire Mytogen Inc and proceed with human clinical trials utilizing myoblast for treatment of heart failure The letter of intent provides for an aggregate purchase price of $5 million payable in ACTC common stock plus the assumption of certain Mytogen liabilities of approximately $1 million.

- ACTC in June 2007 announced major advancements in the process of bringing its Retinal Pigment Epithelial (RPE) program into the clinic to treat various retinal degenerative diseases, including Age-Related Macular Degeneration (AMD). After preliminary discussions earlier this year with staff from the Office of Cellular, Tissue, and Gene Therapies within the Center for Biologics Evaluation and Research at the Food and Drug Administration (FDA), the company has contracted with a leading contract research organization in order to commence work on an extensive preclinical program

- ACTC in June 2007 announced development of first hESC line without destroying an embryo.

- ACTC in June 2007 announced recent approval by US Senate of 152 billion Labour HHS Education appropriations bill  has an ammendment to the bill which expands federal funding for embryonic stem cell research by changing a critical date relating to the eligibility of stem cell lines. The amendment would fundamentally change current federal embryonic stem cell policy by permitting federally-funded research on stem cell lines that were derived before June 15 of this year, as opposed to the current marker of August 9, 2001. The committee noted that this moving of the date forward by almost six years will advance progress toward treatments and cures by significantly expanding the number of stem cell lines eligible for federally funded research.

- ACTC in Sept 2007 announced 12.55 million private placement which will result in 10 million in gross proceeds.

- ACTC in Sept 2007 announced that ACTC Single Cell Biopsy Technique to be considered for federal funding. ACT’s groundbreaking Single Cell Biopsy technique was cited by the National Institute of Health (NIH) as an alternative method in its implementation plan.The NIH plan calls for “aggressively pursuing an assessment of the potential of alternative sources of pluripotent stem cell lines, including altered nuclear transfer; single cell embryo biopsy, and reprogramming, or dedifferentiation of somatic cells, such as skin cells.”

-  ACTC in Oct 2007 announced selection of ACTC Myoblast Phase 1 trial by American Heart Association (AHA) as a featured late breaking trial for its annual scientific sessions conference in Orlando Florida.

- ACTC in Jan 2008 announced that the National Institute of General Medical Sciences at the National Institutes of Health (NIH) has awarded the company an SBIR Phase 1 Small Business Grant. The company will use the grant proceeds to conduct research that will allow for rapid labeling and purification of specific lineage restricted cells (LRCs) in cultures of differentiating human embryonic stem cells. If successful, the research will help the company more rapidly develop new regenerative therapies for a variety of indications including cardiovascular disease as well for commercialization of the LRCs and their peptide-targeting agents as research reagents. The research aims to create a process by which specific markers can be identified that will act like nametags allowing LRCs to be identified and then purified.

- ACTC in Feb 2008 announced completion of pre-IND meeting with the FDA for RPE Therapy for the Treatment of Retinal Degenerative Disease.

- ACTC in Feb 2008 announced for the first time a robust and highly efficient process for the generation of high-purity hepatocytes (liver cells). This is a significant step towards the efficient generation of hepatocytes for use in regenerative medicine and drug discovery.

- ACTC in Feb 2008 announced agreement with Pharming Group N.V. giving Pharming an exclusive, global license to non-human use of certain patents associated with but not limited to oocyte activation patents held by Advanced Cell Technology. According to the terms of the license agreement, Pharming will pay Advanced Cell Technology a one-time license fee. Prior, Pharming had a nonexclusive license to these patents. Based in the Netherlands, Pharming Group N.V. is focused on developing treatments for genetic and aging diseases, specialty products for surgical indications, and intermediates for various applications and nutritional products.

- ACTC in March 2008 announced a supply agreement with Biologics Delivery Systems Group, Cordis Corporation (a Johnson & Johnson company), in which Biologics Delivery Systems will supply catheters for the Phase II human clinical trial of ACT’s myoblast therapy for the treatment of heart failure.

- ACTC in March 2008 announced a clinical trial agreement with Chandler Regional Medical Center and Mercy Gilbert Medical Center, members of Catholic Healthcare West (CHW), the nation’s eighth largest healthcare system, to become ACT’s first clinical trial sites for the Phase II myoblast study.

- ACTC in April 2008 announced ACTCellerate platform has yielded 140 cell types from Human Embryonic Stem Cells.One of the hurdles with hESC has been a commercially viable means for the expansion of sufficient numbers of the cell types needed for tissue regeneration. With the publication of work entitled “The ACTCellerate Initiative: large-scale combinatorial cloning of novel human embryonic stem cell derivatives,” ACT scientists have solved some of these problems.

- ACTC in August 2008 announced the generation of functional Red blood cells from hESC. ACTC and its collaborators at the Mayo Clinic and the University of Illinois, shows for the first time that the oxygen-carrying capacity of hESC-derived blood cells is comparable to normal transfusable RBCs, and that the cells respond to biochemical changes in a physiologically effective manner.

- ACTC in Dec 2008 announced creation of JV with leading Korean biotech company CHA Biotech. The new company Allied Cell Technology will develop human blood cells and other clinical therapies based on ACTC’s proprietary hemangioblast cell technology.

- ACTC in Dec 2008 announced that ACTC has entered into a license with Ireland-based Transition Holdings, Inc, for certain of its non-core technology. Under the agreement, Transition agreed to acquire a license to the technology for $2.5 million, which includes the extinguishment of $1.5 million of debt and an additional funding commitment of $1 million. The intellectual property does not relate to any of the Company’s advanced clinical programs.

- ACTC in May 2009 announced that CHA Biotech and ACTC have entered into a licensing agreement under which Advanced Cell will license its proprietary single blastomere technology, which has the potential to generate stable cell lines, including retinal pigment epithelium (RPE) cells for the treatment of diseases of the eye, to CHA Bio for development and commercialization exclusively in Korea. ACT received an undisclosed up-front license fee. The Company believes there are some 200 different retinal diseases that may be impacted by this stem cell derived therapy including macular degeneration, which represents a $28 billion dollar market. Age-related macular degeneration (AMD) affects more than 30 million people worldwide and is the leading cause of blindness in people over 60 years of age in the United States.

- ACTC in Nov 2009 announced that it filed an Investigational New Drug (IND) Application with the US Food and Drug Administration (FDA) to initiate a Phase I/II multicenter study using embryonic stem cell derived retinal cells to treat patients with Stargardt’s Macular Dystrophy (SMD).
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The other important data is the Short Squeeze data for ACTC its down 82% which means there is going to be some positive news flowing out real soon. (Short Squeeze Data for ACTC : Link)

Conclusion: ACTC is the stock to be in if you are looking for stem cell as an investment destination. It is well established and even the US govt looks up to ACTC for advise and recent developments in stem cell arena.
- Labour HHS Education appropriations bill passed on July 2007 had an ammendment to stem cell research bill.  The bill would expand federal funding for embryonic stem cell research by changing a critical date relating to the eligibility of stem cell lines. The amendment would fundamentally change current federal embryonic stem cell policy by permitting federally-funded research on stem cell lines that were derived before June 15 of this year, as opposed to the current marker of August 9, 2001. The committee noted that this moving of the date forward by almost six years will advance progress toward treatments and cures by significantly expanding the number of stem cell lines eligible for federally funded research.


Key among those lines would be upwards of twenty cell lines from Advanced Cell Technology (ACTC). These would include the Company’s single cell blastomere lines, created without the destruction of embryos



The RPE IND approval is going to be an easy breeze for ACTC considering the amount of pre-clinical test and ACTC standing in stem cell field..you can expect some real great upside as the stock is discovered by mainstream investors (the last to get in on the bandwagon!!)












Monday, November 23, 2009

SRZ Q3 Report - Better Days Ahead

Market Cap: 167.21 million CMP: 3.27Recently SRZ has reported Q3 2009 financials. It has been another loss making quarter. But then we are looking forward and what is of concern is the forward looking quarterly outlook.


There have been a number of changes (sale of assets and contract cancellation) SRZ management has provided us with data about remaining assets and their earning capability.


What we have here is that the remaining properties of SRZ have an operating profit of close to 120 million (per quarter) and we can expect a yearly operating profit of 120 x 4 = 480 million.

Assuming there are other expenses (for new communities being built as well as over head expenses) of 90% of earnings we can still expect SRZ to report conservatively 10% profit of 48 million. ie Assuming 432 million of overhead expenses. (
link)
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As reported by SRZ the 21 communities sold to BKD had contributed 13.9 million of net loss for 9 months ended Sept 2009. The sale would net SRZ 50 million in cash. (
link) So the 21 community sale will really help SRZ as it reduces debt by approximately 130 million and also nets 50 million in cash.
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What we have here, is a corporation that was taking advantage of the past positive factors by agressive growth, which is now adjusting itself to the new reality of conservative financing and de-leveraging its balance sheet.
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If one takes a pot shot at BKD (which has close to 2 billion dollars of debt in its books) and a market cap of 1.95 billion. I would say within 1-2 years we can expect SRZ to overtake BKD in market capitalization as BKD still has lot of Debt which will unfold in the coming years. (I expect BKD market Cap to fall below 1 billion and SRZ's market cap to rise above 1 billion
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Monday, October 19, 2009

SRZ: Shareholders as of Sept 25,2009

Please find below the list of majority shareholders holding more than 5% in SRZ.
5 groups (including 11.5% by promoters Mr & Mrs Klaassen) hold more than 45% of shares.

And these holders exist from Dec 2008 so they are long term holders.

Largest holder is an Insurance company: Guardian Life insurance Company:
Here is the list




The SEC filing link is here

Friday, October 16, 2009

SRZ: Sells 21 Communities for 204 million.

SRZ has on Oct 9,2009 sold 21 communities with 1389 units for 204 million plus customary transaction expenses. The break up of the 1389 units are :
- 92 independent units
- 876 Assisted units
- 421 Alzheimer's units

The 21 communities sold are located in the following 11 states in US:
California - 1, Colorado - 1, Connecticut - 2, Georgia - 1, Indiana - 4, Michigan - 1, New Mexico - 1, North Carolina - 1, Ohio - 6, Pennsylvania - 2, Virginia - 1
===========================================
BKD is the buyer and some of the salient points are:
- BKD will finance this transaction with 134 million of mortgage debt (
substantially through the assumption of existing debt)
- Balance payment (70 million) to be paid from cash on hand.
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As per SRZ the following are the salient points:
- SRZ will record an impairement charge of 7 million in the Q3 2009 to write down 5 of the 21 communities to fair value.
- SRZ will expect to record a gain in realestate of approximately 50 million.
- SRZ will receive 60 million in proceeds after payment or assumption by the purchaser of certain mortgage loans.
- SRZ
will use the funds to pay down the bank line of credit and for working capital requirements.===========================================
Observations:
- SRZ has sold 5 communities below their value book value and taken an impairement charge of 7 million. I am sure these 5 communities are in Ohio and Indiana.
- Since these communities are whollly owned subsidiaries we can expect a reduction of SRZ debt by 130 million.
- Out of 70 million cash payment by BKD (my assumption is) 50 million will be used to pay down the bank line of credit and 10 million will go towards working capital and 10 million to paydown debt related to sold properties.
- SRZ had 614.5 million of debt and 69.2 million of bank credit facility on June 30,2009. (
683.7 million)- This transaction should reduce the total (683.7 million) debt to approximately 503.7 million. 26% reduction in debt.
==========================================
Observations with regards to SRZ's Debt Levels:
- SRZ has stated that the German community debt in its books is worth 190.2 million.
- German community debt is partially recourse to SRZ and it is expected that on settlement of debt SRZ
will record a gain.
- Once the German community sale is legally closed we can expect a reduction in debt of 190.2 million ie total debt will be reduced to 313.5 million.
[683.7 million -130 million(21 community sale) - 50 million (credit line payback) - 190.2 million (german community sale)]
- It has also been stated in the Q2 report that 170.2 million of debt is in default (has become short term) due to Sunrise failure to meet certain financial covenants.
- I assume with the reduction of debt to approximately 313.5 million from 683.7 million (54% reduction) SRZ will be able to pass the financial covenants test. This will make 170.2 million of short term debt into long term debt and also reduce SRZ's short term cash requirements.
========================================Conclusion: All the communities sold were wholly owned subsidiaries (which means they were really the best assets) Some of these assets (5 out of 21) are located in non performing areas and SRZ has found it prudent to sell them at a loss. These assets are like family jewels and will impact SRZ networth on the long term.

SRZ's problems are however due to short term cash flow issues. This transaction along with German community sale will help reduce SRZ's debt levels by 50% and hopefully bring the company back to stable financial condition.

SRZ then can continue to leverage its brand equity and work on strengthening its financial base improve its market capitalization. We can expect SRZ's market cap (Curent 262.25 million) to double from these levels. Equity dilution is possible when market cap reaches close to 1 Billion dollars (Stock Price 20)

Since we are at an inflection point and news updates will be positively biased we can expect rapid improvement in SRZ's market capitalization. Q3 report would still be negative but we will see substancial improvement in Cash flows


PN: These are my personal views and assumptions about information available in the public domain.
- Link to SEC filing for Q2 2009 report
-
Link to SEC filing for sale of 21 communities


Sunday, August 16, 2009

SRZ: Senior Assisted living company Valuations 6.39 USD

Quarterly results are out for Q2 2009 and we can compare the valuation of different companies in Assisted senior living industry. This will help us objectively value companies.

Cash flow is what I would consider along with market capitalization for comparision of the companies. Cash flow is generally considered as a better indicator than Earning Per Share (EPS) or Net Profit.
The following table for reference of : Cash flows, Market Capitalization & Multiple [Multiple= (Market Cap)/(Cash Flow)]
Five Star and Sunrise Senior Living are two companies in the list of 5 Senior living companies that is quoting at a discount (MarketCap)/(Cash Flow) ratio. Expected share price column mentions the share price when the Market Capitalization will be 11.135 times cash flows.
PN: This is not a suggestion/recommendation to invest. Please make your own decision with respect to valuations and investment rationale.