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Alexander J. Poulos  

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  • Exxon Mobil - Additional Pain Ahead For Energy Investors [View article]
    OPEC pumped the most crude last month in more than three years as Iran returned output to the highest level since international sanctions were strengthened in 2012. The 12-member group, responsible for 40% of world oil supplies, raised output in July by 100,700 barrels a day to 31.5M. The increase came even as Saudi Arabia, which often curbs output toward the end of the summer, told OPEC it cut production by the most in almost a year. Crude futures -1.6% to $44.26/bbl.
    Aug 11, 2015. 09:13 PM | Likes Like |Link to Comment
  • Exxon Mobil - Additional Pain Ahead For Energy Investors [View article]
    Warren,

    The oversupply in the oil patch places downward pressure on the price of the commodity. Traditionally, you would see OPEC cut production in an attempt to stabilize the market. The free fall began last November when the Saudis refused to cut production and we have arrived at our current predicament. Many believed the price would bounce by now, especially with rig count declining as much as it has. Yet as shown by the numbers above, supply continues to come to market. I suspect the price of the commodity along with the producers will remain weak here. I am in no rush to venture in, the more conservative play is to sit back and allow the story to play out. Once supply firms up, there will be plenty of time to enter in. Thanks for reading and taking the time to comment.
    Aug 11, 2015. 09:11 PM | Likes Like |Link to Comment
  • Exxon Mobil - Additional Pain Ahead For Energy Investors [View article]
    Oil Can,

    Not at all. The difference stems from the expected bounce in XOM revenues next year. MB believes we will see a sharp bounce while my numbers show a more muted advance. The Levered Returns Model works quite well based on the assumptions used.
    Aug 10, 2015. 11:12 PM | 1 Like Like |Link to Comment
  • Exxon Mobil - Additional Pain Ahead For Energy Investors [View article]
    Jerry,

    Fair enough, thanks for reading and commenting.
    Aug 10, 2015. 09:10 PM | Likes Like |Link to Comment
  • Exxon Mobil - Additional Pain Ahead For Energy Investors [View article]
    Timmies,

    The lack of traction in the price of crude scares me. I don't think we have seen a bottom yet. The problem becomes how low can it go. I refuse to short the industry yet continue to monitor events for an attractive entry point. Many didn't believe XOM would break $80 and yet here we are in the $70's. As always, thanks for reading and commenting.
    Aug 10, 2015. 09:08 PM | 2 Likes Like |Link to Comment
  • Exxon Mobil - Additional Pain Ahead For Energy Investors [View article]
    Mad Stacks,

    I agree with your thesis. From the CC of the various companies I have looked at the price of oil they are basing their decisions on revolves around 50-60 per barrel. At the current quote of $45 per barrel, it will force a downward re-evaluation of Capex budgets. Not a pleasant place to be. Depending on how things shake out, the fourth quarter may offer an excellent buying opportunity. Thanks for reading and commenting.
    Aug 10, 2015. 09:04 PM | 3 Likes Like |Link to Comment
  • Exxon Mobil - Additional Pain Ahead For Energy Investors [View article]
    abigsoxfan,

    I am interested in the space, the potential is there for an attractive low risk entry point. The main problem in the energy space is over supply. When researching various sources for the article, I was surprised that production continues to grow. We have seen a drop in wells, I was hoping to see the impact of supply yet it has not manifested itself. I suspect the down cycle has additional legs here. Thanks for reading and commenting.
    Aug 10, 2015. 09:00 PM | 3 Likes Like |Link to Comment
  • Shaken, Not Stirred: Is The 'Biotech Bubble' Beginning To Burst? [View article]
    Doc,

    Great article as always. The market is currently firmly trapped in no man's land. You have the threat of an imminent interest rate hike most likely in September that hangs over the market in a similar manner as the Sword of Damocles. Liquidity tends to dry up a bit in the August through first half of September as WS and Europe hit the beaches for their holiday. The market as you so eloquently proved above is driven by liquidity, not the best technical backdrop right now.

    On the plus side we have rates that are extremely accommodative which has sparked the urge for M&A activity. A raise of up to 1/2 pointy does not kill the M&A boom, if anything it may quicken the pace as companies feel the window is starting to close. The collapse of the commodity space is a net positive for consumers as the price of energy has gone down which has an impact on the price of food. Food inflation remains as clearly seen in the price of eggs and meat. The real estate market is beginning to percolate which is a positive, the construction sector is adding jobs which will balance out the long term unemployment rate over time. The construction sector was the hardest hit sector, any life shown here in my view is a net positive. A vibrant real estate market allows one to move in the hunt for better opportunities. When the market is down, most peoples wealth is tied to the value of their home. If you factor in leverage (i.e. mortgage) a 10% drop in value would wipe out most homeowners wealth which would precluded them from moving.

    Summing it all up, in my view the trend remains higher yet far from the torrid pace seen over the past five years. A large portion of cash which can be deployed on market draw downs is they key to generating outperformance here. Cash now accounts for the largest weighting in my model portfolio with a 15% weighting. This is the largest percentage in over six years.
    Aug 8, 2015. 09:24 AM | Likes Like |Link to Comment
  • My Current Price Target On Gilead Sciences [View article]
    Ptatty,

    What are your current thoughts on DIS after the perceived earnings disappointment today. The shares dropped over 10% which is a surprise.
    Aug 5, 2015. 09:26 PM | Likes Like |Link to Comment
  • My Current Price Target On Gilead Sciences [View article]
    kruetzer,

    Your comment is well thought out. The HCV marketplace is quite dynamic and much harder to predict than most. Part of the issue is the curative effect, as you referenced with demand replenishing itself. I would not be at all surprised if my model is proven to be far too conservative. GILD remains one of the most dynamic names in the market today. A fascinating story to watch unfold. Thanks for reading and taking the time to comment.
    Aug 5, 2015. 09:24 PM | 1 Like Like |Link to Comment
  • My Current Price Target On Gilead Sciences [View article]
    Ptaty,

    Fair enough, thanks.
    Aug 4, 2015. 06:57 PM | Likes Like |Link to Comment
  • My Current Price Target On Gilead Sciences [View article]
    Ptaty,

    I am looking for year over year revenue growth in 2016. The model above shows 30.2 billion in revenue for 2016, I would not be at all surprised if GILD surpasses this in 2015. As per custom the numbers will be adjusted each quarter post the earnings release. Thanks for reading and contributing.
    Aug 4, 2015. 06:19 PM | Likes Like |Link to Comment
  • My Current Price Target On Gilead Sciences [View article]
    Vince,

    I couldn't disagree more. The only thing holding the share price up here is the guidance. If analysts were left to their own devices the price swings in GILD would be similar to those seen last December. Yes it is actually true they were guiding for a decline in the pace of revenue in the call. Most analysts do not belief this to be the case, I am routinely seeing numbers in the 31 billion dollar revenue range.

    As for your assumptions, the role of the labs is vital. It is not far fetched to envision them generating an additional $4 billion dollar revenue stream from the lab via internal discovery or through acquisition. This is what makes the share so enticing in my eyes. The problem is how to accurately model for this without misleading the audience. Watch the price action in the shares especially post any clinical data release. The markets reaction will be quite telling. Thanks again for reading and commenting.
    Aug 4, 2015. 04:22 PM | Likes Like |Link to Comment
  • My Current Price Target On Gilead Sciences [View article]
    Dothemath,

    Thanks for taking the time to comment. Let me address a few of your points.
    On the Japanese patient issue, I have no doubt the medical community has warehoused patients in anticipation of the approval of Harvoni. The Japanese government will released reimbursement data in the third quarter. Japan will be a large market of GILD.
    2- The patient count in Europe will continue to climb yet with a caveat. The budgets there are more constrained than in the US, the revenue will be recognized yet at a slower pace.
    3- I firmly believe management is low balling the numbers to allow for an easy hurdle to jump through. An analyst made reference to this point during the Q&A session. I continue to monitor expense control along with cash flow. GILD is continuing to execute at a very high level.
    Aug 4, 2015. 03:18 PM | 1 Like Like |Link to Comment
  • My Current Price Target On Gilead Sciences [View article]
    133,

    Exactly, hence my more cautious tone. Revenue guidance for next year is crucial.
    Aug 4, 2015. 03:12 PM | Likes Like |Link to Comment
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