Seeking Alpha
  • Whole Foods Market: Fairly Valued
    WFM Today, 3:14 AM Brian Sanders Comment!

    Summary

    • An industry fraught with uncertainty.
    • Valuation suggests no significant upside or downside.
    • Technicals forecast whipsawing, however price resistance may indicate downside.
  • AAC Holdings IPO May Be Addicting To Growth Investors
    AAC Today, 3:00 AM Don Dion Comment!

    Summary

    • AAC, a provider of inpatient treatment for individuals with drug and alcohol addictions, plans to raise $80,500,000 with its upcoming IPO, set for Thursday, 10.2.
    • With reported growth (AAC recently posted positive revenue and net income figures), dedicated management, and solid underwriting, the deal appears as though it could be successful.
    • We also like that AAC’s business is differentiated among some of its healthcare peers.
    • We suggest investors consider buying into this IPO.
  • Continental Resources' Recent Share Price Dip Creates A Buying Opportunity
    CLR Today, 2:55 AM Balanced Investing Comment!

    Summary

    • Continental Resources’ share price has fallen due to the company’s announcement of an increase in drilling costs.
    • Continental’s unrisked resource potential in the Bakken region is approximately 4.1 billion BOE (barrels of oil equivalent) in addition to the company’s proved developed reserves of 240 million BOE.
    • The company has announced a new oil discovery, the Springer Shale, in the heart of the SCOOP region.
    • The CEO of Continental Resources bought 72,000 of the company’s shares for a total of more than $4.85 million.
  • Canadian National Railways Company: A Business With High Protection Barriers
    CNI Today, 2:48 AM Alpha Strategist Comment!

    Summary

    • CNI is a stable business that enjoys high protection barriers. High barriers are inherent to the railway industry making the companies operating in the industry long-term and stable investments.
    • CNI received recognition as a sustainable business by gaining a place in the Dow Jones Sustainability World Index.
    • The consensus target price and relative valuation measure indicate the fact that the company is under-appreciated by the market.
    • The growing dividend and share repurchase program makes it an attractive investment.
  • Enterprise Products Partners: Another Step Towards Growth?
    EPD Today, 2:47 AM IAEResearch Comment!

    Summary

    • The focus on the NGLs segment will continue to bring growth for the company as this segment is growing at an exceptional rate.
    • The completion of the phase one of Aegis pipeline will start to show benefit by the end of the next quarter.
    • Addition of another fractionator will further enhance the capacity of the partnership in the NGLs segment.
  • Ford's Sell-Off Might Present A Buying Opportunity
    F Today, 2:38 AM Diesel Comment!

    Summary

    • Ford's lowered its guidance significantly for 2014.
    • Investors sold their shares off in fear and panic.
    • The long-term picture still looks intact and downside is limited from here.
  • Dermira IPO: Less Appealing In A Hot IPO Week
    DERM Today, 2:22 AM Don Dion Comment!

    Summary

    • DERM anticipates raising ~ $80 million on 5.4 million shares priced between $16 and $18 in its IPO on Friday.
    • DERM’s IPO bookrunners are Citibank and Leerink Partners—solid but less illustrious than some peers.
    • While Dermira has been successful raising capital as a private company, it is not certain its skin products will make it successfully through trials.
    • Compared with other, more appealing IPOs this week, DERM is one on which we suggest investors hold off.
  • BlackBerry's Significant Margin Of Safety
    BBRY Today, 1:30 AM Gonzalo Carrasco 5 Comments

    Summary

    • BlackBerry could be cash flow neutral as early as next quarter. The company's substantial cash holdings provide a compelling margin of safety for long investors.
    • Even assuming a very conservative scenario, BBM could be worth at least $910 million.
    • After accounting for debt, solely the company's cash and BBM support almost half of BlackBerry's valuation.
  • IPO Preview: Wayfair
    W Today, 1:18 AM IPOdesktop Comment!

    Summary

    • E -commerce business model targeting 35 to 65 year old women with annual household incomes of $60,000 to $175,000.
    • Top line rev +50% (buyng customers), 23% gross profit.
    • -$22.52 per share dilution, 9% loss on rev, P/E of -30.
  • IPO Preview: Atento S.A.
    ATTO Today, 12:58 AM IPOdesktop Comment!

    Summary

    • Largest provider of customer relationship management and business process outsourcing services in Latin America and Spain.
    • Revenue, operating income, earnings, EBITDA all down.
    • -$21 per share dilution, 32 times tangible book value.
    • Operating income only 2.8% of rev, P/E of -31.
  • Target's Distribution Strategy Is A Better Plan Than Its Discounting Strategy
    TGT Today, 12:54 AM ColoradoWealthManagementFund Comment!

    Summary

    • Target's aggressive discounting destroyed their advantage in operating margins.
    • Despite aggressive discounting, Wal-Mart is growing sales at a faster rate without losing much from operating margins.
    • Amazon may have a hard time replicating Target's distribution strategy, but I don't think Wal-Mart would find it difficult.
  • IPO Preview: AAC Holdings
    AAC Today, 12:35 AM IPOdesktop Comment!

    Summary

    • Leading provider of inpatient substance abuse treatment services for individuals with drug and alcohol addiction.
    • Difficult to grow, very competitive market.
    • May be a roll-up acquisition vehicle in a fragmented market.
    • P/E ratio of 122, Price-to-sales of 2.3.
  • Here's Why We Believe Cree Is Still Worth $58
    CREE Today, 12:31 AM Trefis Comment!

    Summary

    • Despite reporting strong earnings growth this year, Cree’s stock price has declined by approximately 40% year to date.
    • Lower gross margin, doubts regarding the company’s capability to sustain its growth in the long term, and rising competition are some of the key factors contributing to the negative sentiment.
    • Our price estimate of $58 for Cree is at a 40% premium to the current market price of $41.
  • IPO Preview: JP Energy Partners LP
    JPEP Today, 12:30 AM IPOdesktop Comment!

    Summary

    • Growth-oriented limited partnership formed in May 2010 to own, operate, develop and acquire a diversified portfolio of midstream energy assets.
    • Yields 6.5% at midpoint.
    • From drop-down asset acquisitions (problematical).
  • Dick's Sporting Goods Looks Like An Interesting Prospect
    DKS Today, 12:22 AM Daniel Jones Comment!

    Summary

    • After seeing its shares downgraded, Dick's Sporting Goods lost about 2% of its market value on Sep. 23.
    • In recent years, the business has done quite well, but year-to-date the retailer's bottom line hasn't been so hot.
    • However, evidence suggests that Mr. Market might be underestimating the retailer.
    • This makes the business an interesting prospect since its short-term effects could be temporary, but investors shouldn't assume that the company belongs in the bargain bin.
  • IPO Preview: VWR Corp.
    VWR Today, 12:20 AM IPOdesktop Comment!

    Summary

    • Leading, independent provider of laboratory products, services and solutions to the global life science, general research and applied markets.
    • Top line rev +4%, operating margin 6.2%. P/E of 29, -$40 per share dilution.
    • Proforma income up only because of debt repayment.
  • Should You Consider Adding To An Already Oversize Position In Berkshire?
    BRK.B, BRK.A Yesterday, 11:40 PM Jim Sloan 6 Comments

    Summary

    • Traders advocate doing more of what works and less of what doesn't; does this maxim apply to value investors?
    • Berkshire Hathaway has become in recent years an oversize part of my portfolio. Is there a rationale for adding to it?
    • Bayes Theorem implies that affirmative new information should increase one's conviction (justifying increasingly large position size in a stock).
    • I have owned and followed Berkshire for more than 25 years, in the process not only gathering information but also improving my ability to analyze that information.
    • Berkshire's success is not so smooth as to raise doubt (like Madoff or LTCM), but is enough to confirm Berkshire as the real deal - a low-risk compounding machine.
  • Update: Synta Pharmaceuticals Files Insider Buying With SEC, As I Said Carpe Diem
    SNTA Yesterday, 10:51 PM Christopher F. Davis 3 Comments

    Summary

    • Synta Pharmaceuticals has just filed a form 4 with the Securities Exchange Commission for an insider buy from Bruce Kovner.
    • When I recently opined I talked about how nothing had fundamentally changed with the company; the selloff was an opportunity to buy; I did not foresee a major insider buy.
    • The news is bullish and is a catalyst to plug the bleeding in shares; take advantage of the sale and Carpe Diem.
  • General Electric: Is Diversification Its Achilles' Heel?
    GE Yesterday, 7:08 PM StockBot 12 Comments

    Summary

    • The sheer scope of General Electric’s business is mind boggling without even critically looking at it.
    • While in theory diversification is supposed to protect a company from operating risks in different sectors, too much of it can slowly put the company at a disadvantage.
    • For retail investors, the task of pouring through the General Electric’s earnings reports is nothing short of a nightmarish experience.
    • What questions should potential GE investors ask themselves?
  • Ultralife: Limited Downside With Multiple Growth And Value Catalysts
    ULBI Yesterday, 7:06 PM John Leonard, CFA Comment!

    Summary

    • The stock trades near a 52-week low due to depressed government and defense spending; as a result management now expects a 10% decrease in revenue and operating loss for FY14.
    • The short term outlook is more constructive than investors are giving management credit for given the implied forecast for 2H14 profitability despite this top line pressure.
    • Management continues to diversify beyond the core military markets with an expansion into faster-growing commercial markets; commercial revenue now accounts for >50% of overall revenue.
    • The downside is limited by the high TBV, net cash equal to 30% of the market cap and high FCF; cash flow should improve following an expected inventory reduction.
    • The $50 million of domestic NOLs and announcement of a buyback for 10% of the shares outstanding are two overlooked value catalysts.
  • Nike's Strong Growth Brings Good News For Investors
    NKE Yesterday, 6:30 PM Stock Gazer 1 Comment

    Summary

    • Nike's quarterly revenues were $8 billion: a 15% increase. Net income was recorded at $962 million: a 23% increase. EPS were $1.09: a 27% increase. Gross margins increased to 46.6%.
    • The company recorded good results in geographical regions independently as well.
    • Nike has set a high guidance for the next quarter and the full year as well.
    • Though the World Cup is over, the Olympics in 2016 could be another ground breaking opportunity for Nike to benefit from.
  • Pandora Looks Interesting After A 40% Pullback
    P Yesterday, 5:27 PM Sean Chandler 7 Comments

    Summary

    • Pandora has dropped more than 40% since March.
    • Pandora is nearing its 52-week low.
    • JPMorgan has reiterated a $42 price target on Pandora, which would represent a 74% upside from its current levels.
  • U.S. Energy: This Oil Stock Is Too Cheap To Ignore, With Significant Buda Exposure
    USEG Yesterday, 5:15 PM Hawkinvest 12 Comments

    Summary

    • A major pullback in the oil sector has created a significant buying opportunity.
    • While the whole sector has dropped significantly, oil is not down that much on a percentage basis and with OPEC needing prices near current levels, a bigger pullback is not warranted.
    • Many small cap oil stocks are now oversold and could be poised for a major rebound in the coming days and weeks.
    • U.S. Energy is a little-known oil stock that does not deserve the recent pullback, especially as it has very high potential projects in the Buda sweet spot.
  • Hawaiian Airlines: Recent Pullback Provides An Attractive Entry Point
    HA Yesterday, 4:39 PM Sam's Picks 3 Comments

    Summary

    • A recent 15% pullback from highs provides investors with a good entry point.
    • The company remains cheap, despite rising 85% over the past year.
    • Much of the company's expansion plans remain entact.
  • Synchrony Financial: The Huge Company You Have Never Heard Of
    SYF Yesterday, 4:39 PM Ashleigh Rogers 3 Comments

    Summary

    • Synchrony has the potential to rival Discover and American Express for investor's attention in a few years.
    • The company has a strong moat in its field and the financial strength to grow its operations.
    • As regulatory hurdles abate, Synchrony should command a higher multiple.
  • Why JD.com Should Not Trade At Less Than 1/5 Alibaba's Valuation
    Editors' Pick JD Yesterday, 4:36 PM Terracotta Capital 2 Comments

    Summary

    • I discuss the less obvious reasons of why JD.com deserves a higher valuation and the fundamental difference between JD.com and Alibaba.
    • JD.com has a strong logistics network that is almost unrivaled. In contrast, Alibaba does not build its own fulfilment capability but instead engages third-party logistics providers.
    • Tie-up with Tencent is a breakthrough for JD.com which will likely result in large influx of mobile traffic.
  • Northeast Bancorp: National CRE Niche Strategy Impelled By High Cost Structure
    NBN Yesterday, 4:30 PM Time & Model Comment!

    Summary

    • Over capitalized: 23.4% Tier risk-based capital ratio.
    • Low return: FY 2014 ROE of 2.6%.
    • Over expensed: FY 2014 efficiency ratio of 86.85%.
    • Trades at a discount to book -- which appears to be deserved.
  • A Bizarre Pharma Love Triangle
    SLXP Yesterday, 4:00 PM Bill Gunderson 2 Comments

    Summary

    • A bizarre love triangle has ensued in the world of specialty pharma.
    • Over the last year, Allergan has spurned offers to be acquired from both Valeant Pharmaceuticals and Actavis.
    • Now Allergan has announced it wants to pursue its own acquisition.
  • Looking Forward At Janus Capital As Bill Gross Arrives
    JNS Yesterday, 3:54 PM Alpha Now at Thomson Reuters Comment!

    Summary

    • Much ink has been spilled in 2014 on the topic of legendary investment manager Bill Gross and his sudden (but by no means unexpected) departure from Pimco.
    • Gross jumped to Janus Capital Group Inc., which said Gross will be managing its new Global Unconstrained Bond Fund.
    • Like the Roman god Janus, we look backward and forward at the possible repercussions.
  • Herbalife: The Coming Reversal
    HLF Yesterday, 3:52 PM Rogier van Vlissingen 26 Comments

    Summary

    • The 100-year anniversary of the FTC passed without any sign of action in the Herbalife case.
    • Regulatory capture is a fact until the trend is reversed.
    • Popular sentiment is starting to run ahead of regulators, law makers and prosecutors.
  • Key Announcements Represent Big Wins For Rubicon
    RBCN Yesterday, 3:19 PM Dennis Seaman 2 Comments

    Summary

    • New MOCVD reactors from Veeco and Aixtron are designed for larger diameter sapphire wafers.
    • San’an Opto’s order for 50 MOCVD tools will add massive demand for four-inch wafers starting in 4Q14.
    • Rubicon will likely receive four-inch volume orders in the next few weeks from this added capacity.
  • Herman Miller Is Tapping Into A Growing Market
    MLHR Yesterday, 3:18 PM Trading Champ Comment!

    Summary

    • Herman Miller is capturing a bigger and growing market by getting out of office furnishing and focusing more on home furnishing.
    • In 2010, the number of people in the U.S. working at least one day a week from their homes reached 13.4 billion.
    • Nearly 69% of U.S. entrepreneurs start their businesses at home and continue to operate at home even when it is well established.
    • The number of housing starts in U.S. has increased by nearly 16% in July 2014 compared to the figure reported in June.
    • The increase in the number of mobile workers and housing starts provides decent growth opportunities for the company.
  • Free Cash Flow Champions Part 2: Priceline And F5 Networks
    PCLN, FFIV Yesterday, 3:16 PM Brad Kenagy Comment!

    Summary

    • I looked through every company in the S&P 500 to see if there were any companies that have had increasing free cash flow every year.
    • I found that only 3 companies out of the whole S&P 500 have increased free cash flow each of the last 10 years.
    • In part 1 of my series I focused on Oracle which was the only dividend payer, and in this article I will be focusing on Priceline & F5 Networks.
  • Is Angie's List Scaling To Profits?
    ANGI Yesterday, 3:03 PM Stone Fox Capital 7 Comments

    Summary

    • Angie's List shows signs that it can scale toward a profitable business in the larger markets.
    • The costs of entering second tier markets are draining the financial resources of the company.
    • Investors shouldn't be surprised if a suitor finds the local review site appealing, but the potential exists that reviewing strategic options occurs after weak Q3 results.
  • Alcoa - As Analysts Raise Expectations Into Earnings, I Remain Cautious
    AA Yesterday, 2:58 PM The Value Investor 4 Comments

    Summary

    • Bank of America turns optimistic on Alcoa heading into its third quarter earnings report next week.
    • This comes after shares have doubled already over the past year, with investors applauding the value-added strategy which seems sound.
    • Not being able to figure out how profitable the business is expected to become going forwards, I remain a bit more cautious as expectations have risen significantly already.
  • Congress Debunks The ADT Short Thesis
    ADT Yesterday, 2:38 PM Terrier Investing 1 Comment

    Summary

    • A Congressman sarcastically suggested that the White House look into subscribing to ADT.
    • ADT is synonymous with trustworthy home security for a vast majority of American consumers.
    • The short thesis misses the forest for the trees.
  • An Overview Of The U.S. Tobacco Market
    Editors' Pick MO Yesterday, 2:23 PM The Enterprising Value Investor 15 Comments

    Summary

    • Despite widely available data and research, media and investors continue to retain misconceptions about the tobacco business.
    • Further consolidation through the Reynolds' acquisition of Lorillard could provide a dynamic pricing environment, in which a Reynolds American and Altria duopoly could create above trend pricing increases.
    • E-cigarettes remain a relatively unregulated industry whose growth threatens the current tobacco profit model.
    • Valuations currently look stretched amongst the US manufacturers and are currently being driven by M&A activities.
  • Michael Blair's Incredible Journey - Apple's Blowout Launch
    AAPL Yesterday, 2:22 PM Ugly Duckling 98 Comments

    Summary

    • Blair incorrectly accounts for iPhone pre-order sales.
    • His retort to Bill Maurer and Chuck Jones grazes over some important points.
    • Although the launch was simply an indicator of supply, it was still impressive.
  • Turning Positive On Cumberland Pharmaceuticals Again
    CPIX Yesterday, 2:05 PM Paulo Santos Comment!

    Summary

    • Prospects for Cumberland Pharmaceuticals are improving quickly.
    • From a situation where the company lost significant revenues and went into negative earnings due to a patent expiration, the company has returned to growth and profitability.
    • This turnaround is due to successful execution of the company's strategy. The turnaround means Cumberland Pharmaceuticals is cheap, growing fast and has option value.
  • Update: Corvus Gold Finds More Gold In Nevada
    CORVF Yesterday, 2:03 PM The Investment Doctor Comment!

    Summary

    • Corvus Gold announces decent drill results from six more holes.
    • This could have been expected, but the potential discovery of a new parallel zone was not anticipated.
    • My investment thesis will change based on the different overall market, rather than based on these drill results.
  • After SEC Wells Notice, Is School Out For ITT?
    ESI Yesterday, 1:59 PM Shock Exchange 12 Comments

    Summary

    • ITT Educational Services received a Wells Notice from the SEC suggesting it may seek a cease-and-desist order against the college.
    • The company failed to produce year-end 2013 financial statements, and its financial stability is murky amid declines in student enrollment.
    • I am short the stock on the thesis that ITT could eventually be shut down by regulators.
  • Update: Google Slashing Cloud Computing Prices Again Is A Clear Negative For Amazon.com
    AMZN Yesterday, 1:47 PM Paulo Santos 26 Comments

    Summary

    • Google has announced yet another 10% drop in cloud computing prices.
    • This is a major negative for Amazon.com, because its recent deterioration in earnings was mostly tied to the previous drop in cloud computing prices.
    • The market is aware of this link and is likely to react negatively to the news.
  • Just Happened: NiSource Analyst Day
    NI Yesterday, 1:44 PM Alerian Comment!
  • BioLight Israeli: A Small-Cap Biotech With Potential Upside
    BLGTY Yesterday, 1:40 PM Anita Dushyanth Comment!

    Summary

    • BioLight Israeli Life Sciences invests in, manages and commercializes biomedical innovations in the field of ophthalmology and cancer diagnostics.
    • The company offers a rich portfolio of products.
    • IOPtiMate, laser surgical device for glaucoma and CellDetect® cell staining technology for detecting and monitoring cancer cells, had a soft launch at the beginning of this year.
    • BioLight’s products address a large untapped market which provides an attractive investment opportunity.
    • We initiate coverage on BioLight with an outperform rating.
  • Woolworths Limited Or Wesfarmers Limited: Which Can Give A Better Long-Term Return?
    WOLWF, WFAFF Yesterday, 1:31 PM LN Investors Comment!

    Summary

    • Both companies are market stalwarts in Australian retailing.
    • Together they control a large part of their markets.
    • With three performance metrics and three dividend related comparisons, we can see which has the advantage and may generate a better total shareholder return.
  • Unilife Releases OrbiMed Loan Covenants: Is Default Imminent?
    Editors' Pick UNIS Yesterday, 1:25 PM Stone Street Advisors 17 Comments

    Summary

    • UNIS's OrbiMed credit agreement originally was granted Confidential Treatment of material details.
    • Financial covenant thresholds were redacted - leaving investors & analysts unable to determine default risk.
    • We filed a FOIA request and appeal with the SEC in May to force UNIS to disclose these facts.
    • Amended 10-Q exhibits filed this week show UNIS will be in default if it fails to achieve $40 million in calendar-year 2014 revenues.
    • UNIS's revenues through the first 6 months of CY 2014 are only $7.9 million.
  • BHP Billiton Advances Mexican Oil Plans With Pemex Agreement
    BHP Yesterday, 1:21 PM LN Investors Comment!

    Summary

    • BHP Billiton signs MOU with Mexico's Pemex for information exchange.
    • This could lead to a formal working partnership for offshore oil development.
    • The resource rich Perdido oil province would be very attractive for BHP to work in.
  • If You Own Coal Stocks, You Need General Electric Too
    GE Yesterday, 12:52 PM Efficient Alpha 10 Comments

    Summary

    • While the long-term outlook on coal is still positive, investors need to diversify across other energy sources.
    • General Electric books a third of its sales in energy-related segments and is developing innovative products that could revolutionize energy usage.
    • Shares of GE trade relatively cheaply against peers and offer an attractive cash return to supplement capital appreciation.
  • 'A New Order Of Things' - Micron's Challenge And Opportunity (Part 2)
    MU Yesterday, 12:43 PM William Tidwell 30 Comments

    Summary

    • Micron is focused on marketing and producing specialized memory devices and systems tied to specific customer requirements.
    • Although the company has begun to make the needed changes, it is not currently investing adequately in sales and marketing resources to execute its strategy.
    • Administrative resources beyond sales and marketing must be developed in order for Micron to be a reliable, dependable, and attractive business partner to its customers.
    • Successful implementation of a new go-to-market strategy will result in Micron being able to harvest much higher margins from its NAND and DRAM (and Next Gen) memory business.
  • Spirit Airlines Is Making A Rough Landing Right Now But Will Take Off Again Shortly
    SAVE Yesterday, 12:40 PM Abba's Aces 2 Comments

    Summary

    • The overall market swoon is dropping all stocks and Spirit is coming down in price with the market.
    • The company however looks to be trading at an inexpensive valuation with respect to 2015 earnings growth expectations.
    • The company sports one of the highest return on assets in the major airlines industry.