| Red Lion Hotels 9 1/2% Capital Trust Preferred Stock Yahoo Ticker RLH-PA Recent Price $23.65 Current Yield 10.2% Quarterly Dividend .5938 Next Dividend Payment Date 3/31/2010 |
Copyrights 2006-2007 SGM Publishing |
| Description Red Lion Hotels Corporation operates as a hospitality and leisure company in the United States. It engages in the ownership, operation, and franchising of mid-scale and upscale, and full service hotels under the Red Lion name. The company also offers entertainment services, such as event ticketing, and the promotion and presentation of various entertainment productions. As of December 31, 2008, its hotel system contained 47 hotels, of which 19 were wholly-owned, 13 were leased, and 15 were franchised, located in 9 states and 1 Canadian province, with approximately 8,910 rooms. It was formerly known as WestCoast Hospitality Corporation and changed its name to Red Lion Hotels Corporation in September 2005. The company was founded in 1937 and is based in Spokane, Washington. Commentary Red Lion Hotels is a rather small chain of hotels primarily located in the Northwest United States. While many lodging chains have been losing money during the recession Red Lion has remained modestly profitable. While the profits have been just modestly profitable they have good positive cash flows. It should be noted that Red Lion just let their CEO go, with no good explanation. The new CEO claimed it was not for performance reasons--you can read the story here. Red Lion will be reporting earnings for the 4th quarter of 2009 on 2/16--it will be interesting to see if the business is holding up well. For anyone considering buying the preferred security it may be wise to wait for the earnings announcement---a modest report will not drive the security up----but any downside surprise could drive the price down. This security is very thinly traded so limit orders must be used as the spreads on the bid/ask can be large. We will add some of this security to both our Blended Model as well as our High Yield Portfolio in the next few days This is not a recommendation to buy any security---but is only meant to point out potential opportunities which may or may not fit an individuals investment needs. The companies website is here and should be visited by those considering purchasing this security. The companies latest 10-Q filing is here. |
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