So, the big vote occurred last week, and shareholders of Brookdale Senior Living have spoken. We are sure that the recent increases in occupancy convinced some shareholders to stick with management and its “plan.” But the nominees from activist shareholder Ortelius Advisors were not off-the-wall candidates. It was an excellent group, and despite what Brookdale stated, again and again, they would have provided a new perspective and a lot of expertise. The current and temporary CEO could have learned from several of them, specifically Steven Vick, Steven Insoft and Lori Whitman. Oh well, a lost opportunity for many of the shareholders. Not to mention other members of the management team, the staff at the buildings and the residents.

There is one area where we disagree with several of the activist shareholders and the current management. Some shareholders believe that the share price should be at least $10 to $20, with the possibility of going much higher. I can see $10 if operations continue to improve. But $20? That’s a real push.

Occupancy would have to increase substantially, costs would have to come down, and the capital structure would have to continue to improve. These are not easy tasks when you are not yet profitable. My goal is to start running some numbers to see what it will take to improve value, perhaps close to where it was over a decade ago. And then there is how long it would take. I would have a lot more confidence in any projections if the three executives mentioned above were on the Board, not to mention who the new CEO will be. Stay tuned.