Today, 8/24/10 I sold 2 ACAS Nov10 6 Covered Calls for a net deposit of $28.47 in an IRA account.  My basis for these ACAS shares is now 23.13, excluding dividends received.  This transaction represents a simple return of .61% and an annualized return of 2.56% on my basis.

Thomson Reuters rates ACAS as Outperform on 8/22/10 while S&P has a 12 month price target of 7.00 and a Hold rating.  Market Edge Second Opinion has a price opinion of 5.01 and also has a Hold rating on the stock.

The market has not been kind to ACAS since mid-2008, for good reason.  As recently as March 2010, the ACAS auditors (Ernst & Young) had included in the audit report an explanatory paragraph regarding ACAS ability to continue as a going concern.  On June 30, 2010, E&Y issued an amendment statement the going concern issue no longer exists.  What changed?  Well, the company was able to complete a major restructuring of its unsecured borrowing arrangements and is no longer in default.

I read through much of the quarterly and annual returns last night and feel a little more encouraged about the future of ACAS.  Now if the stock price would just improve I would feel even better yet.  However, as my strike price and the analysts suggest, I suspect that it will be a little while yet before the stock price substantially improves.

ACAS does not currently pay a cash dividend.  As a regulated investment company, ACAS is required to pay some level of dividends to retain that status under the IRS code.  Or that is how I understand it.  Apparently ACAS is limited to paying dividends with capital stock and only as much as necessary to maintain it status as a regulated investment company.  My last dividend payment was part cash and part stock.