Seniors Housing Weekly Update - Recent Market Developments

October 23, 2012


 

October 23, 2012. 60 Seconds with Steve Monroe. With Assisted Living Concepts jumping in price, Capital Senior Living continues to hit new highs....

Recent Market Developments

We are not sure what exactly is going on with Assisted Living Concepts. It is the one company that we receive several calls a week on, usually from hedge funds that own the stock or are thinking of buying it. On Monday of this week, the shares were up 6% on heavy volume of 1.3 million shares.  The only real news was an 8-K filing that said average third quarter occupancy was 5,251 residents, which is down 2% from the average in the second quarter. And this is a reason to buy? The company had already announced the suspension of its dividend, which while prudent, was another hit to shareholders who liked the yield.  So why the sudden interest, other than our recent mantra that anything in the $7.00 range is a bargain?  Who knows? In other news, Capital Senior Living keeps on hitting new highs, and Care Investment Trust unexpectedly canceled its planned acquisition of seven properties owned by Juniper Communities. Although it was a steep price, what could they have found in the post-announcement due diligence to walk away? Stay tuned.

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