StoneMor Partners L.P. (NYSE:STON)

Back in this stock again primarily for the yield and lack of extreme volatilivty

A company people that people are dying to get into their product!

Recession proof, high yield and great revenue growth.

Unfortunately, people just keep on dying.

tmfbabo....this looks like its been depressed and will likely close on sp500

solid balance sheet (though confusing), dividend

The cost argument may or may not be correct, but the continuous stock price cannot be ignored.

This is a much-misunderstood stock and that certainly has a negative impact on the valuation. There is an excellent article in Forbes which explains some of the complexities, here are some quotations:

"Kate Stalter: Tell us about a few of these equities that you are putting your clients into, Paul.

Paul Maher: I want to disclose that I am long these positions on behalf of my clients, and the other is I’m not making a recommendation to anybody else.

I have a lot of favor in a position called Stonemar Partners (STON). It is a recession-proof industry. It is in the mortuary and cemetery business. They are again a limited partnership.

They have an awkward relationship with the IRS. The rules for the IRS make their fundamentals—if you’re not looking them as a partnership, limited partnership with a distribution characteristic, it’s hard to read that this company can afford to pay its dividend.

But when you do the proper research, you find out that this position has a great deal of assets that can’t get shown, because they have to wait at least a year for a certain percentage of them to be allowed on the books, even though they’ve already collected the money. And then they have to wait until the product is used when the client dies, or when they make up a selection for a specific whatever.

Kate Stalter: Interesting business model.

Paul Maher: Yeah, it very much is. The nature of their business allows them to leverage against assets that can’t be shown on their 10Ks and their 10Qs, because IRS rules don’t allow it.

They are growing so fast that it looks like they’re outreaching sort of their logistical line. Their ability to supply their growth is accomplished on the debt side, but it’s very carefully collateralized against assets that aren’t allowed yet to be shown as assets.

A limited partnership that’s not growing…this process would catch up with itself, and it would look OK on the books. But when a company like this particular company, Stonemar, grows as fast as it does, it’s harder to see it. It’s a bit underappreciated.

It goes through a little more volatility than I tend to like, but I’m there for my clients to earn a distribution, and that’s what we’re doing."

Investing in StoneMor in real life would creep me out, but I can see why so many people think that it is a good investment right now. This misunderstood stock now sports a massive 11% yield. The credit rating agencies are a joke. I'll gladly take advantage of a selloff caused by them.

Deej

Misunderstood stock that is beat up from S&P debt downgrade and short speculation. Now yielding 10+% with potential capital appreciation. MLP structure.

buy the dip, baboon strategy.

People pay taxes and die. What else is sure?

Totally misunderstood and mis-analyzed by many published analyses, STON can and will maintain its superb dividend over the years, and will be vindicated in the end.

Lots more Boomers are gonna get old and end up being "customers", STON has 270+ years of real estate on hand already, and management knows what its doing when it comes to acquistions. Plus, dividends, dividends, dividends...

Death is a growing industry.

I believe that this stock will outperform due to the fact that its future earnings and repayment to debt can be done given time. I like the fact that it repays its investors, which shows a good sign to how management shows fiduciary responsibility to its owners. At the price that this stock is at now is right around one resistance point, as the other is right above 20. If they can have steady revenue while continuing to pay its investors in high dividends while making payments to its debt will likely make this stock rise and outperform.

One of the MF services recommended StoneMor Partners L.P. the end of July. Since it's a low volume equity, I put it on my watchlist and thought I'd check back in after the spike decayed somewhat. It flared on my watchlist after the last two day selloff and I'm checking back in.

The articles in July mirror closely the article by Alex Page on August 19th that is now part of Fool public record so I can refer to it.
http://www.fool.com/investing/general/2011/08/19/rising-star-trade-buy-stonemor-partners.aspx

Alex ponts out how StoneMor's business from a financial perspective is not well understood by the markets. StoneMor deals in funeral services from plots, perpetual care, funeral needs such as headstones, caskets, cremations etc. Cashflow in particular can be difficult to follow due to accounting requirements that Alex outlined very well.

This left the 8% plus dividend as a premium for investors and an argument that the share price could appreciate if investors caught on, if not you get a larger dividend.

One problem is that if a company is difficult to explain, even if you explain it to a few and they either get it, or go out on faith as some MF subscribers do, there is still a vast majority of investors left who will stay away.

StoneMor Partners L.P. "crashed" hard the last two days as S&P down rated their credit worthiness. Moody's is holding theirs. The cash flow has become an issue as StoneMor puts much of it's receipts in escrow as it's advance payment. Perpetual care expenses also leveraged interest from the escrow accounts which is at a minimum.

Matt discusses the steep selloff in this Fool Article.
http://www.fool.com/investing/general/2011/11/30/stonemor-shares-dropped-what-you-need-to-know.aspx?source=itxsitmot0000001&lidx=1

While I wasn't interested in StoneMor last July at the $28 entry price, I am an opportunist and low volume equities that start triggering stop losses can be opportunities. There is, however, the issue of trying to catch a falling knife and it typically takes 2-3 days for settling to occur. In the case of low volume equities, however, stop losses may escalate into a territitory that won't be repeated unless there is more negative catalyst piled on.

I actually wish I'd ran faster and put in a $21 RL limit order yesterday when this started dropping. You shouldn't try to catch a falling knife, but if the risk is low, you have some bandaids on hand and some surplus blood left over from Halloween then sometimes it's worth a stake in the ground, or a casket. The overall industry is recession proof!

Upside back to mid-$20's and will evaluate.

Misunderstood by most, well run and will continue to pay hefty dividend plus capital appreciation

Good entry point I hope