BBX Capital Inc

Not all research is for securities currently held. Any securities for which research is provided herein may be reduced, completely closed out, or not purchased at all without notice of any kind.

January 27, 2021

BBX Capital (“BBX”) is a company controlled by the Levan family in Ft. Lauderdale. The company has been through several iterations. At various times, it has owned a bank, a home builder, and a timeshare business. The current iteration was formed this past Fall after spinning-off its timeshare business, Bluegreen Vacation Holdings (“BVH”). The remaining businesses in BBX Capital are several real estate ventures located throughout Florida, a building products company focused on windows and doors, and a struggling candy business.

We believe BBX Capital is extraordinarily cheap due to the spin-off, its new listing on the OTC market, the super-voting shares held by insiders, and the complicated nature of the remaining businesses.

BBX’s recent share price is $5.35. The company has net working capital + note receivable from BVH less outstanding liabilities equal to $6.74 per share. In addition, BBX’s real estate investments have another $6.22 per share of value. This conservative valuation of the company is $12.96 per share, which we find compelling compared to the $5.35 stock price.

This valuation is conservative because

  • it carries the home building products business at net working capital of the subsidiary,
  • the Real Estate at book value even though many of the properties have been enhanced, and
  • assigns zero value to the candy business.

We believe BBX Capital’s stock price can approach $12.96 over the medium term. We look at the management team’s track record of transactions to enhance value over the last 10 years. We believe management will announce another transaction to enhance the value of BBX Capital. Our guess is they will announce a share repurchase program.

Back to Research Downloads

Disclaimer: The discussion of any security is meant solely as an illustration of our investment and thought process and should NOT be considered as a recommendation or suggestion to buy or sell any securities. Before you make any investment, do your own research and talk to your own financial adviser. Information in this report is received from external sources. Therefore, we can make no guarantee as to the completeness or accuracy of the information provided.

Sign up to receive Gator research

(We expect to email you 6-8 times per year)