Not so long ago Kyle Bass has said that now is probably the hardest time to invest, also adding that he is of the opinion that Harry Reid and Nancy Pelosi do want the United States to go over the fiscal cliff because of political reasons.
Half of Bass’ hedge fund Hayman Capital is in subprime bonds, which Bass deems as “bulletproof.’ Moreover, he sold out of 6 stocks for Q3 – Tellabs, GasLog Ltd, Magnum Hunter Resources Corporate, Whiting USA Trust II, Alcatel-Lucent and Dynegy. He is now left with stocks valued at 70.32 million dollars which include 2 new ones: Sealy Corporate and Hyatt Hotels Corporate.
Kyle bought 323, 250 shares of Hyatt Hotels for 38 dollars per share on average. This corresponds to 18.5 per cent of his portfolio. The shares have gained 23.5 per cent as for November 2009.
Hyatt Hotels, a global hospitality company, had revenue increase annually from 3.3 billion dollars in 2009 to 3.7 billion dollars in 2011. 42 million dollars was the net loss in 2009, which afterwards had a net gain of 113 million dollars in 2011.
For the past 3 years Hyatt Hotels has been producing free cash flow. Its cash is 1.6 billion dollars and its debt and long-term liabilities are of 2.2 billion dollars. The company has a P/S of 1.5, a P/B of 1.2 and a P/E of 45.2.
In Q3, Hyatt Hotels repurchased 911,244 shares at an average of 38.78 dollars per share, with a total cost of 35 million dollars.
Kyle Bass bought 3,817,860 shares of Sealy Corporate for 2 dollars per share on average. This equates to 11.8 per cent of his portfolio.
Three months ago Tempur-Pedic announced that it was acquiring the bedding manufacturer – for 2.20 dollars per share. The two companies expect their deal to close in the first half of 2013.
Sealy Corporate is now trading for 2.19 dollars per share after its increase of 27.33 per cent year to date.