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Akram's Razor

 
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  • NQ Mobile: A Neutral Observer's Take [View article]
    This is ironic considering the biggest example fast money wise here are the insiders. Judging by their stock sales they don't have anything close to a 100 year vision.
    Nov 4 11:34 AM | 1 Like Like |Link to Comment
  • NQ Mobile: A Neutral Observer's Take [View article]
    I don't need to be convinced of anything. Clearly the company has liquidity, and the convert was enough to convince me of that as well as the cash flow statement. I shared this because I did it as a favor, and it without a doubt helps explain just why MW was CAPABLE of raising this red flag. Which is precisely what it was. This could have been easily avoided with a more conservative approach commiserate with where the company is in its lifecycle. I assure you there is not a reputable investor in history would not agree with that conclusion. It is simply aggressive cash mgmt which can lead to or be a sign of other potential weaknesses. Now it would appear when all is said and done mw's word choices might be libelous, but they will have a decent defense here as far as this being a red flag.

    What would have been better PR wise is acknowledging the mistake, and fully explaining why at the time it seemed like the right decision for NQ to do what no 'blue chip' names are willing to do with their cash. And then simply transferring some cash as was done to completely shoot their allegations out of the sky.

    The point here is they built a case with many points that are in my opinion the direct byproduct of carelessness on managment's part. Outside of their technical allegations every single other thing they pointed out could have been 100% avoided with better disclosure and stricter operating controls. If that is not a roadmap for how to manage the pr around this i don't know what is. Acknowedlge the weaknesses and say we will correct them. Something along "We are a young fast growing company, and these things can happen to such a company"
    That is what i look for versus buybacks and quotes about 100 year plans.
    Nov 4 11:23 AM | 2 Likes Like |Link to Comment
  • NQ Mobile: A Neutral Observer's Take [View article]
    And if that is true he will be dealing with lawsuits for a VERY VERY long time. And nobody will ever take a report he writes seriously again. On a side note, I too made money long fmcn.
    Nov 4 11:01 AM | Likes Like |Link to Comment
  • NQ Mobile: A Neutral Observer's Take [View article]
    The takeaway here is if they had simply held some cash level 1, MW's argument/allegations would have been much weaker. Whose fault is that? If Bidu and Sina feel the need to hold a decent level 1 reserve shouldn't nq? Again it simply is a sign of operational control weakness...not conclusive of anything...but something I obviously would prefer did not exist if i am long a stock.
    Nov 4 10:58 AM | 1 Like Like |Link to Comment
  • NQ Mobile: A Neutral Observer's Take [View article]
    Post Sino forest, I wouldnt necessarily disagree with you. But then again go unearth a multi-billion dollar fraud, and tell me whether you need to do anything ever again.
    Nov 4 10:47 AM | 1 Like Like |Link to Comment
  • NQ Mobile: A Neutral Observer's Take [View article]
    I think if MW's is wrong here the reputational damage will be irreversible. Considering what he has built up, I do factor that into my analysis of the situation. As for the cash, bidu and sina have the 'luxury' of holding some cash in level 2 or even all of it. The point here is neither does that yet the company that shouldn't have the luxury of doing that is actually doing precisely that.
    Nov 4 10:44 AM | 2 Likes Like |Link to Comment
  • NQ Mobile: A Neutral Observer's Take [View article]
    As a side note, clearly a lot of people where burned here and understandbly are quite upset. You should be asking yourself whether this happened because of MW or because management made at least a few mistakes if not several.
    Nov 4 10:32 AM | 1 Like Like |Link to Comment
  • NQ Mobile: A Neutral Observer's Take [View article]
    It's sad that some people have a hard time understanding what is an honest walk through of just why this was capable of happening. You think MW could have done this to Bidu or Sina(WHICH BTW I AM A WELL KNOW UBER BULL ON HERE). No they couldn't.
    Nov 4 10:29 AM | 1 Like Like |Link to Comment
  • NQ Mobile: A Neutral Observer's Take [View article]
    It hurts your credibility that you don't understand that no business, let alone a high growth tech business with high carrier dso's shouldn't be caring about a few % incremental return versus having highly liquid cash on hand at all times. MW may be flat out wrong and even reckless in its comments, but there is no denying this is not 'PRUDENT' cash managment for any company let alone a young 'growth' story. Same goes for the buyback. I don't go long 50% plus revenue growth companies for share buybacks.
    Nov 4 10:25 AM | 4 Likes Like |Link to Comment
  • NQ Mobile: A Neutral Observer's Take [View article]
    Good, that is precisely what you should be doing, and more than happy to be long the stock if this is actually the case. As I stated in another comment, I would not short your stock here. However, there is no denying that there is a lot of 'confusion' regarding the secure nature of the product if bloomberg is getting third party paid reports that seem to support what MW put out there. As for everything else beyond the buyback, I have would be willing to discount out to being a fast growing business in china's wild west.
    Nov 4 10:19 AM | 2 Likes Like |Link to Comment
  • NQ Mobile: A Neutral Observer's Take [View article]
    A big five audited enron and then went down with it....sino had auditors....so have countless chinese frauds.....so that says little to me. But like i said, my initial inclination is this is not a fraud, just a young weak internal controls company that is making many young/china company esque mistakes which typically dont fly in US market.
    Nov 4 10:11 AM | 2 Likes Like |Link to Comment
  • NQ Mobile: A Neutral Observer's Take [View article]
    Like I said I have no position in this stock, and actually have been looking at is as a favour to some people long the stock, who can freely produce themselves if they want. I think the key takeaway here is that whatever one's view may be, the reason MW was able to impact this as they have are mgmt's and not MW's fault. I have longed several MW short's since Sino Forest, and did lose being short sped which had tons of red flags but ended up executing just fine and growing like a weed in its space. I posted this because I am at the end of the day curious how when all these coinicidental red flags pop up how they end up being reconciled. As someone who shorts quite often, I am naturally quite curious hear responses. But I assure you I am quite neutral regarding the outcome of all of this, and actually as I have some people i know long. Am pulling for them. But running this through my screener this is how i as someone with no position would view the stock. And while i have no real value to add as far as mw's allegations, I can tell you 100% the 'cheap/growth', buyback, cash positioning relative to stage of company, and comments/tone are things I firmly believe in and can cite countless examples over my trading career that make noticing them worthwhile.
    Nov 4 10:08 AM | 2 Likes Like |Link to Comment
  • Commvault: Red Flags Galore [View article]
    Also, the point was to be short the stock expecting this print. And when you short-sell, you learn over time how to manage bearish views on stocks with take out risk. I.e trading our event catalysts with options instead of simply being short. Broken business models you simply short and ignore timing, but robust models with 'valuation' issues you use optionality to manage exposure and leverage return. Then it is simply about getting the timing right. I came to this stock as a short after the q4 call. Shares were 85 when i started shorting. You know how i got there? Because i had listened to the previous 4 calls ahead of it just to gauge what a small enough shift in momentum to support a thesis would be. The idea is to use acquired knowledge of a business to its fullest in either direction. The move to 40-80 i missed because by definition i will miss these things because i'm wary of extremes. But having made money long the name I have enough of an understanding to know what 'transition'..'investm... do to operating momentum and headline news when a stock has been running for a while undisturbed. Did same thing with ffiv, and countless other solid tech names over the years. Great businesses can be priced 'badly'....and as far as short selling that is usually a lot easier than going after a bad business if you know what you are doing. Because at the end of the day bad businesses do attract a good deal of short-sellers which can make things a lot more difficult pricing wise. Is cvlt expensive next to data, now, splk, and countless others....no it is damn cheap....but the measuring stick there right now is different...and that at the end of the day is what the market is all about.
    Nov 1 05:19 PM | Likes Like |Link to Comment
  • F5 Networks: Multiple Contraction Storm Coming [View article]
    There you go 100% return. Now take your profits despite my view as your options are a little to risky. U cud leave 20% of the position to see if it really rolls over between now and analyst day as internals for these stocks are starting an acclerated deterioration
    Nov 1 11:15 AM | Likes Like |Link to Comment
  • F5 Networks: Multiple Contraction Storm Coming [View article]
    I'd wait a few more days. The window against these stocks is strong. But yeah you shud have bought the 90's or 88's as i did
    Oct 30 03:57 PM | Likes Like |Link to Comment
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