Resource America Reports

This is awesome….I bought more shares this morning.

Listen to the call, it is only ~20min long… why? There was not a single analysts on it. Not one..Reminds me of the day when we started buying iGo (IGOI) at $1 a share and nobody was paying attention to them.

Resource America Q4 Earnings Call (click to hear call)

The news was very good…

1- They are divesting non-core assets and have deal in place to do so. This will provide ~$1 a share in proceeds which will be used to buy back stock

2- The Cohen’s will be buying back stock themselves per their 13D filing (do not forget they just got a cool $250M from the Atlas deal)

3- The Cohen’s already own 23% of the stock (fully diluted)

Let’s do some math:

We have 19,049,000 share outstanding. The Cohen’s have 4,846,097 per the above referenced filing. Assuming REXI does in fact receive the expected net proceeds of $1 a share for the divestitures and uses it as they said they would and repurchase shares, that would take ~3.14M shares off the market (assuming a $6.05 share price).

We will call it an even 16M shares outstanding at that point giving the Cohen’s 30%+ of the company before they begin buying shares themselves. Other holders are Yacktman Asset Management 1,599,466, Tilson’s T2 Partners 1,230,366, and Cooperman’s Omega Advisors 1,195,000. The top 4 shareholder groups will then hold 8,870,929 shares or ~55% of the co.

This amount of share buying in a small company with a small, stable shareholder base will have an effect on the stock, a good one. Add this to improvements along all business lines and I am excited about the future of this holding.

There is no meaningful short interest.

Resource America Q4 (click to open .pdf)