JANA bought 2.4 million shares of Ryman Hospitality Properties, Inc. (NYSE:RHP) between October and December after not having own any shares according to its previous filing. The real estate investment trust owns and operates Gaylord branded hotels and convention centers as well as several Nashville attractions. As a REIT, Ryman Hospitality Properties, Inc. (NYSE:RHP) is required to distribute a large share of its cash to shareholders in order to preserve its favorable tax status and as at many such companies this results in a high dividend yield, of 4.5% judging by recent dividend levels and current prices.
Teekay Corporation (NYSE:TK) rounds out our list of Rosenstein’s small cap picks as the filing disclosed a position of 1.3 million shares. The company transports petroleum products such as crude oil and natural gas, and also deserves mention for a considerable dividend yield of 3.7%. We are a bit concerned about the valuation here, however: at a market capitalization of $2.4 billion, the stock is valued at 36 times forward earnings estimates. Cash flow multiples aren’t much better, with the enterprise value being 10.5x trailing twelve month EBITDA.
Income investors could certainly consider Ryman Hospitality Properties, Inc. (NYSE:RHP), although we would advise them not to concentrate their portfolio too much on real estate investment trusts. From a value perspective, we actually don’t like a lot of these companies and would actually wonder if Teekay is a short candidate. Rockwood Holdings, Inc. (NYSE:ROC) and Visteon Corp (NYSE:VC) (assuming that company hits its earnings targets) have at least some value potential but we don’t think those businesses are particularly attractive compared to their peers and other companies exposed to similar factors.
Disclosure: I own no shares of any stocks mentioned in this article.