So I'll try and explain why I hold shares in this company and it is a bit difficult to explain.
When I became a shareholder in SOL I never saw it as a chance to become an indirect holder of shares in NHC or BKW or TPG etc. In fact I hardly ever consider their performance when reviewing SOL. I simply look at the following SOL table:
They pay a solid dividend which, they're proud to continually state, increases each year. That dividend, for the most part, represents no more than about 50% of the earnings. The remainder of those earnings are poured back into the business which is why, mainly, the equity has increased from $3.7m in 2016 to $5.1m in 2020. That increase is a result of the retained earnings and improvement in the value of some assets. You can see the issued share number has never altered across this time frame. Despite the increase in the equity, they've managed to increase profits to support the same return (around 8% - ignore the 2020 lucky break). I've only shown five years history here for ease of presentation but this pattern goes back a long way.
These guys are never going to shoot the lights out but they're pretty likely to keep the lights on. When I bought these shares I paid for the skills on offer as investment managers. NHC, BKW, TPG etc will come and go (albeit not too often) but they'll just continue to efficiently use the funds available as they always have.
With respect to the Theo / TPG issue, I can't believe that the SOL guys would have just read about that in the morning paper while blowing the froth off their first cappuccino. My guess is that they would have been across this some time back and have acted accordingly.
So, if you're not already confused by my ramblings, I think the current price is too high and has to retreat somewhat so Selling isn't a silly idea at these numbers. I continue to muse over that myself. I may reduce my holding but I really don't know.
I own shares in NHC.
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