American Capital, Ltd. (NASDAQ:ACAS)

CAPS Rating: 4 out of 5

The Company is a business development company that also serves as publicly traded alternative asset manager.


Player Avatar jwray01 (99.83) Submitted: 7/27/2012 10:14:01 PM : Outperform Start Price: $9.80 ACAS Score: +11.75

very low P/B and P/E. They invest in corporate debt on a leveraged basis. They also manage AGNC and MTGE (total 11B market cap) and manage some private equity funds (total ~2B) and collect management fees from that. They also have a huge tax loss carryover.They got burned really badly during the 2008 liquidity crisis and ever since then it's been trading at a major discount to book value. Too low, IMO. Ben's got my back. His hands are tied by the Taylor rule, which says that he can't raise rates unless inflation rises or unemployment goes down. Neither is likely to happen much, because of automation and Moore's law.

Member Avatar dabyrdman (< 20) Submitted: 11/27/2012 4:54:53 PM
Recs: 0

I may be missing something obvious here, but I have been trying to understand the correlation between Moore's law (about transistors per square inch) and inflation/unemployment.

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