Michael Giordano Spyglass Resources Corp SGL-T BUY ON WEAKNESS Nov 18, 2013

Tax loss selling or average down? Thinks management has a shot at turning this company around from the three-way merger that they did. Likes tax loss selling as you can always buy back in. You could Sell today and then just mark it on your calendar for January 6, 7 or 8 and then buy it back.

Have assembled some good assets. The concern is that anyone that is paying out a 15% dividend, the market has made a judgment that it is not sustainable. Feels the price has been driven way down because it was assembled and built as a dividend payer and the market is concerned they can’t keep paying this. Would be a little careful with this at this time. If you own, there may be a relief rally after tax loss selling, which may be a good time to get out.

(Market Call Minute.) Has a Short position on this. A serial underperformer and has a lot of debt. Good bounce because of tax loss selling.

His company has this as a Sector Perform with a one-year target of $2.50. Feels the Street is cautious about this on sustainability given target capital efficiencies and higher debt levels. Company is likely to implement a DRIP and likely look to sell some non-core assets. 13% dividend yield. Would be a little bit cautious on this.

Was a merger of 3 companies transitioning into a dividend model so it didn’t start off on a good footing. Yield of 13% means market does not see dividend as sustainable. Management is trying hard to sustain it. Thinks it should go to 9-10% and pay down the balance sheet.

This was a recapitalization of 3 different companies coming together. Owns a lot of it because he believes management is going to solve the balance sheet issue of too much debt leverage. They will do that through asset sales of non-core stuff that doesn’t really contribute to their ongoing cash flow. Once they do that, he believes there is a yield compression story that is going to unfold. Dividend would probably support an 8%-10% yield versus its current 13.5%. Not out of the question that they could attract some joint venture partners.

This is a combination of 3 companies that merged fairly recently. Pays a monthly dividend of about $0.02. The market is saying that the dividend is likely to be slashed. He doesn’t know why they are paying that much. It makes no sense to him. Have a debt load of over $300 million. Thinks they would be far better off if they started to trim back the dividend or eliminate it altogether. Usually when you have a merger of companies, there is also a write-down, so it would not surprise him if there were some write-downs coming up. Would be in no rush to purchase this. This might prove to be a good tax loss play.

Hasn’t owned this for a year or so. Still waiting for the debt to come down.

(Top Pick Oct 23/13, Down 21.25%) Yield was very strong and he felt the stock should go up to bring the yield down. Management decided to sell assets. Then they had some operating issues. Then we didn’t get a warm summer so he liquidated. Soon afterwards the dividend was cut. We will see what they can do to get the debt lower.

The liquidity situation in this company is profoundly challenged and he would take out any equity value you could.