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$10.52 -0.38 (-3.49%)
7/3/2008 1:08 PM

CapitalSource, Inc. (CSE)

CAPS Rating:
****

The Company operate as a real estate investment trust and provide senior and subordinated commercial loans, invest in real estate, engage in asset management and servicing activities.

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Recs

4

Avatar FleaBagger (99.66) Submitted: 5/14/08 4:53 PM : Underperform Start Price: $14.64 CSE Score: 13.51

Everyone talks about this company's divdend, and says the 20% yield (or whatever it is) is guaranteed by management. Did you know that they don't have to follow through on that? They don't even have to be right about the continued survival of the company.


Have you seen how unprofitable these folks are? It's bad. It's really bad. They have nothing to use to keep paying the divdend, except a return of capital (note: that's not the same thing as a return on capital). This is worlds away from ACAS, one I am long in CAPS and in real life.


At any rate, I wouldn't short this in real life, because if they do manage to pay out the dividend, you would have to pay it too. But on CAPS, why not? Go for the gusto!

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