chev, as far as hurricane plays I agree with the dilute dilute dilute. DPDW is much more than a hurricane 'stock'. It is a couple steps above true garbage like ECCI, etc... (sorry for offending whomever).
But I know my largest holding right now had to borrow on an adjustable rate that was at 7.25% to start the year but is now down to 5%. But that is a company wiht a long operating history so less speculation tied to it than something lie DPDW.
I've seen pretty typical interest rates of 7-8.5% in this interest rate environment for micros but it totally depends on biz leverage, book value, op history, industry, etc... etc...
I think even something like RGMI (that went under basically) had interest rates better than DPDW's, but they also had the share dilution thing going and ARs growing faster than revs. ARs outpacing revs is a red flag in my book since the RGMI days LOL and one that has worked several times in keeping me out of trouble, DPDW has that flag on them currently. There are several others. Doesn't necessarily mean they are bad investments, but if I see ARs grow faster than revs for 3 straight Qs I won't touch the company no matter what. Just my rule. Although Rawnoc made good sense in pointing out to also watch the % change betweeen the two ratios to look for positive (or negative) change.
PS- last year I routinely got nautious looking at 'hurricane plays' because of their financial nightmares LOL.
I don't mind stealing bread from the mouths of decadence... But I can't feed on the powerless when my cup's already overfilled.
-Temple of the Dog
"We didn't build this company on the sniff of an oily rag."
-Anonymous
AI
