St. Joe Buyer Backs Out

Interesting news from St. Joe:

One of the recent mysteries at St. Joe is: What happened to this $130-million land deal earlier this fall for 67,365 acres of conservation land in Liberty, Jefferson, Gulf and Franklin counties? St. Joe terminated the sale but never identified the buyer or why the contract soured. Now the land is back on the market.

Today's enterprise value is 2.27 billion. On September 30, 2008, JOE owned approximately 607,000 acres, concentrated primarily in Northwest Florida. So that values the land at $3740/acre.

But they just lost a deal to sell 11% of their land for $1930/acre (about half of the EV/acre amount). Apparently they also have around 40k paper lots. But lots are a residual function of builder profit margins, which are practically nonexistent right now.

I maintain a small short position in JOE.