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February 9, 2012

Forest City stock seen as bargain by investment analysts from firms that have a business relationship with the company

Atlantic Yards Report

When the 99% complain about income inequality, that's class warfare. When the 1% rig the game, that's just the way the world works.

A 2/7/12 article in Barron's, Forest City Has Room to Grow, suggests that Forest City Enterprises, after divesting itself of the volatile land business and making its board more independent, may do better with investors, especially since it's relatively cheap.

The changes didn't spring from the ever-reformist Ratner extended family. Rather, as Barron's reported:

Many of the changes came after suggestions from existing investors, including Third Avenue Management, the asset-management firm that is the single largest outside shareholder with nearly 20 million shares.

Compromised advisors?

Barron's points out something I hadn't noticed. The investment firms tracking Forest City, whose representatives always seem so chummy with the developer during conference calls, do business with the company.

Doesn't that compromise some of their previously bullish advice? Why weren't they warning investors not to put their money into Forest City if it didn't pursue reforms?


Related content...

Barron's, Forest City Has Room to Grow

NoLandGrab: The Barron's story was penned by Bob O'Brien, not to be confused, we're sure, with Forest City CFO Bob O'Brien.

Posted by eric at February 9, 2012 10:18 AM