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Gabelli’s Mini Reductions, Griffin Land and Fisher
Posted by: Dianne Tordillo (IP Logged)
Date: December 7, 2012 04:12PM
This week, Mario Gabelli of GAMCO investors reported reductions in two companies: integrated media company Fisher Communications (FSCI) and real estate and landscape services provider Griffin Land & Nurseries Inc. (GRIF). Both transactions caused Gabelli no more than about 2 percent of his holdings.
Fisher Communications (FSCI)
Fisher Communications has been in Gabelli’s stock portfolio since the fourth quarter of 2008, starting off with 1.7 million shares and consecutively purchasing in the following quarters until his holding reached more than 2.2 million. Gabelli then started reducing in 2010, as soon as the stock verged on a rising trend, increasing from $14, all the way to $26 by the first quarter of 2011.
Fisher’s opening price today was $25.65, practically the same price that Gabelli sold about 35,000 shares on Dec. 5 give or take a couple of cents, accounting for a 1.86 percent reduction of his stake in the company.
With a market cap of $222.9 million, Seattle-headquartered Fisher Communications is a company that operates 13 full-power television stations, 7 low power television stations, 3 owned radio stations and 1 managed radio station in Western U.S. Additionally, its online division network, Fisher Interactive, has 120 online sites under its wing.
In a recent interview with CNBC, Gabelli mentioned Fisher when listing his recent small-cap picks, stating: “[GAMCO] paid $10 [for Fisher]. The stock is now $25. I think they’re worth $40.”
In early November, Fisher released its third quarter 2012 financial results, indicating positive momentum throughout the three months. It reported slightly higher revenue than the same period of last year, turning in consolidated revenue of $39.9 million, an 11 percent increase.
In terms of balance sheet, it reported a smaller amount of cash and short-term investments at the end of the quarter. The company also generated 23.1 million of cash from operations, and extinguished 1.5 million of the company’s debt. The company has a decreasing line in total liabilities, but currently has no long-term debt. (10-Year Financials)
Lastly, Fisher paid a one-time special cash dividend of $10 per share on Oct. 19, funded by the company’s cash and short-term investments, totaling about $89 million, according to the third quarter results.
"As we look ahead to 2013, we remain focused on expanding our trusted local news brands, as well as providing advertisers the highly effective broadcast and on-line mediums to better reach their customers,” Fisher president and CEO, Colleen Brown, said in the report. “These are hallmarks of Fisher and the pillars that will enable us to deliver value to our audiences, business partners and shareholders."
Griffin Land & Nurseries Inc. (GRIF)
Reducing 2 percent of his shares in another company that Gabelli deems undervalued, the GAMCO investor shed over 20,000 shares of Griffin Land & Nurseries. Gabelli now holds 1,012,459 shares after the transaction.
Accompanying the 13D filing that stated the reduction was a letter dated Dec. 6 stating that GAMCO is evaluating all options for nominating a director to Griffin Land’s 2013 Annual Meeting of Stockholders. The letter was addressed to Frederick Danziger, president and CEO of Griffin Land.
Gabelli’s Griffin holding represents 19.7 percent of shares outstanding. He reported 20.1 percent of shares outstanding prior to the reduction.
Cincinnati-based Griffin Land & Nurseries is a company that offers dual services. In one division it develops commercial space on land holdings in Connecticut, Massachusetts and Pennsylvania. In its other division, the company operates a landscape nursery business, Imperial Nurseries Inc. It has a market cap of $130.4 million and an enterprise value of $179.74 million.
Year to date, Griffin has lost about 4.2 percent of its value and the stock has been fighting to keep its stability afloat, as it intermittently trended for the past three years.
GRIF data by GuruFocus.com
In its 10-Year Financials Griffin shows a consistency in long-term debt in the past year, showing bare signs of pay off, as of yet. According to its 10-Q filing to the SEC, Griffin is committed to purchase obligations of $1.6 million as of Sept. 1, for the development of its real estate assets and the purchase of plants and raw materials by Imperial.
Also as of September, Griffin entered a contract agreement to purchase a 49-acre land in Pennsylvania for $7.2 million in cash before closing costs, amid multiple closings of some of its facilities and existing land holdings. This year, the company has included a charge of $250 in landscape nursery sales to increase reserves for unsaleable inventories and plants that are expected to be sold below cost.
In 2011, some of Imperial’s hoop houses have been damaged due to winter storms that year, which Griffin is still facing capital lease obligations for, as the damaged hoop houses were fully depreciated prior to the winter storms, despite a gain in Griffin’s insurance recovery.
The 10-Q also lists that Griffin is involved in various litigation matters as a defendant, which Griffin foresees should not affect the company financially.
Griffin is currently trading at $25.62. GuruFocus gives it 1 star in Business Predictability, 4 in Financial Strength and 5 in Profitability and Growth.
Guru Discussed: Mario Gabelli: Current Portfolio, Stock Picks
Stocks Discussed: FSCI, GRIF,