Alan Brochstein

Four Ways to Profit From Tight Auto Lending

I missed one - CRMT. After reviewing it, I added it to my portfolio today. Long story short: Small-town used car seller that provides financing, 17% insider ownership, essentially funded internally, low debt to cap, seem to know what they are doing... Oh yeah, trades at tangible book value...

Four Ways to Profit From Tight Auto Lending

I wanted to correct a statement regarding ACF as "the only pure-play". There are two companies that have market caps of about $31mm that I missed: CPSS and UPFC, both of Orange County

AmeriCredit: Risk Worth Taking

I hear you - as Mr. Tonetti pointed out, my timing was impeccable, as KMX released extremely ugly news regarding the used car market a couple of days after I wrote it up. As I stated in the article, it is a very risky investment but one that could have tremendous upside. I am not much of a believer in triple bottoms, so I will have to decide what to do with my position this week.

The risk to ACF is clearly in the loss experience they will endure. They are dead-meat, as I mentioned above, if they can't get the capital to allow them to continue to originate new loans (in a more lucrative market to be an underwriter due to less competition). So far, they seem to be taking the right steps to navigate the crisis. I wish I knew Leucadia better so that I could have a more informed view of the likelihood that they buy the company. They have bought a lot of stock at higher prices, and, from what I understand, have been in the business before.

AmeriCredit: Risk Worth Taking

I hear you - as Mr. Tonetti pointed out, my timing was impeccable, as KMX released extremely ugly news regarding the used car market a couple of days after I wrote it up. As I stated in the article, it is a very risky investment but one that could have tremendous upside. I am not much of a believer in triple bottoms, so I will have to decide what to do with my position this week.

The risk to ACF is clearly in the loss experience they will endure. They are dead-meat, as I mentioned above, if they can't get the capital to allow them to continue to originate new loans (in a more lucrative market to be an underwriter due to less competition). So far, they seem to be taking the right steps to navigate the crisis. I wish I knew Leucadia better so that I could have a more informed view of the likelihood that they buy the company. They have bought a lot of stock at higher prices, and, from what I understand, have been in the business before.

AmeriCredit: Risk Worth Taking

I wasn't joking about potentially being dead-meat. The company will struggle to survive an extended credit crunch. I believe that the recent commitments from DB and from the wrap provider help them into 2009, but, if the environment doesn't pick up by then, all bets are off for this guy.

4 Sectors to 'Buy in May'

I don't know HURC or FARO, but FARO looks good both technically and valuation-wise. HURC seems to have a ton of inventory - haven't looked to see if there is a good reason. I like SKX too. I have some exposure through another holding of mine, SCVL, which trades below book value. Thanks for your comment!

4 Sectors to 'Buy in May'

Some great comments - thanks. Bearfund, you make a lot of excellent points. I know that not everyone is familiar with my views, but I am not a permabull and not even a strategic bull right now. I just think that the market is going to screw with everyone, as it usually does. I was known as "Armageddon Alan" to my clients earlier this year, but I now have a more balanced view that on the economy is muddle along and on the market is drift higher. I refused to be bullish until I observed that the Federal Reserve and the Federal Government began to address the issues to some degree with anything but "rate cuts". I think that there are a lot of companies that can do well, even while others will clearly face a lot of obstacles in a world of diminishing credit and perhaps an increasing propensity to save. As long as the 10yr Treasury remains below 4.5%, I think that stocks are attractive enough in aggregate to own the right ones.