Corsair Capital's Thesis on Ryman Hospitality: Q1 Letter ~ market folly

Wednesday, May 1, 2013

Corsair Capital's Thesis on Ryman Hospitality: Q1 Letter

Jay Petschek and Steven Major's hedge fund Corsair Capital finished the first quarter of 2013 up 8.1% net and their compounded net annual return sits at 14.5%.  Their Q1 letter detailed a write-up of their thesis on Ryman Hospitality (RHP), a current core investment.

Corsair's Thesis on Ryman

In summary, the company is a transformation story as they've morphed from Gaylord Hotels into Ryman, specializing in the premium large group segment. 

They've converted from a C-Corp into a REIT, sold the Gaylord brand and management rights to Marriott, and are looking to leverage Marriott's group customer base.

Due to these (and numerous other changes outlined below), Corsair feels that Ryman has great revenue visibility and thinks it should trade closer to the valuation of shopping mall REITs. 

With a 4.5% yield, they see a $60 stock in the near term and the potential to head as high as $70 if investors give it the premium valuation they think it deserves.

Embedded below is Corsair Capital's Q1 letter with their thesis on Ryman Hospitality:

For more from this hedge fund, we've highlighted some of Corsair's recent portfolio activity as well as their thesis on Acacia Research too.

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