Seeking Alpha

Anthony Grossi

View as an RSS Feed
View Anthony Grossi's Comments BY TICKER:
Latest comments  |  Highest rated
  • In Defense Of Concentrated Portfolios [View article]
    regarding srobbin
    "half perform better than the average"

    actually half perform better than the median, but since investor returns are distributed along a log curve, much fewer than half of investors perform above the average.
    Jul 11 01:27 PM | 4 Likes Like |Link to Comment
  • Your Portfolio Can Get Fat On Fast Food In Brazil [View article]
    You claim that "The company also has an agreement with Coca-Cola (KO) that makes BOBS stores the exclusive restaurant outlets in Brazil for Coca-Cola products."

    stop and think about what a ridiculous claim that is. You can buy a coke at damn near every restaurant in this country just like everywhere else on planet earth. Like Coke would be stupid enough to cap their POS's to 900 some odd locations in a country the size of Brasil.

    Furthermore, a simple glance at 10 yr financial data shows that BOBS gross margins and operating margins are half of MCD's.

    And finally, BOBS competitive advantages are grossly overstated. The market here in Brasil was relatively speaking under represented by fast food chains but now we have McD's and BK (the later of which is owned by a Brasileiro). Both of those international chains have better bargaining power with suppliers due to scale and vastly superior brand recognition as well as ad spend. In an industry with no switching costs. When the tourists come for the world cup and olympics they will eat what they are familiar with, just like the have done at every other international sporting event. BOBS is an overpriced imitation about to be replaced by the real thing.
    Feb 4 12:16 PM | 4 Likes Like |Link to Comment
  • Exelon: Power For Your Portfolio [View article]
    since EXC is mostly unregulated power, its earnings are subject to the whims of energy prices (swings in nat gas prices things like that). The merger will make EXC half regulated, meaning predictable earnings at pre-established prices.
    Mar 12 10:33 PM | 4 Likes Like |Link to Comment
  • Aflac's Fair Value PE Ratio Should Be Double, And So Should Its Price [View article]
    Great series
    Nov 9 10:45 PM | 4 Likes Like |Link to Comment
  • The Case For Intel [View article]
    All of these companies outsource the work overseas to the lowest cost producer. Intel has been in Costa Rica for 15 years. They are already focusing on power efficiency and not just speed (hence the lower performance Atom chip). And Apple already announced they are replacing Samsung.

    Now if we're talking about companies/countries that don't play by the same intellectual property rules that the rest of us have to, well in that case western business culture is screwed no matter what. The hope is that as so-called developing nations develop, they will adopt many of our rule based systems.

    As for changes in technology, I'm no expert, I simply look at Intel's R&D budget (6.5 Billion) and compare it to ARM's free cash flow (180 million) and assume that over time Intel will have the means to create superior products. This logic holds true for every competitor I could think of.

    But yes, irrefutably competition in this space will continue unabated
    Dec 8 06:20 AM | 3 Likes Like |Link to Comment
  • Exelon's Risk Profile Has Changed - What You Need To Know [View article]
    I highly highly recommend that everyone re-read Peter Lynch on investing in utilities

    stage 1 - disaster strikes, a sudden loss of earnings
    stage 2 - crisis mgmt, austerity (dividend cut)
    stage 3 - financial stabilization
    stage 4 - recovery

    Mr. Lynch says you buy a utility, any utility, after it cuts its dividend

    These companies are state regulated monopolies that are not allowed to fail because they provide a necessary service. It is also because of this that they do stupid things with their money, they know that they can't lose.

    “A simple way to make a nice living from troubled utilities: buy them when a dividend is omitted and hold on to them until the dividend is restored. This is the strategy with terrific success ratio.”

    Look at CEG, this advice has held true for what 40+yrs now
    Nov 21 10:51 AM | 3 Likes Like |Link to Comment
  • Arkansas Best: Want A Trucking Company For Free? [View article]
    it's an interesting idea, but given the values across the freight forwarding industry I think you could buy a EXPD or even FDX with less operational risk than PACR or ABFS. I remember when Yellow Freight collapsed. This is a commodity business pure and simple and the end can come quickly. it's an interesting turnaround story, but recent remarks from fdx, et al, make it sound like things could stay rough for another couple years
    Sep 22 08:59 PM | 3 Likes Like |Link to Comment
  • Exelon: Power For Your Portfolio [View article]
    executive chairman means he is the head of the board. In other words he has been reduced from an operational executive to a rich guy who gets paid way too much to sit on at board meetings and nod his head approvingly. Kind of like an associate producer in Hollywood, this is a demotion in responsibility without a corresponding demotion in pay.

    That's my take anyway
    Feb 25 03:35 AM | 3 Likes Like |Link to Comment
  • Exelon: Power For Your Portfolio [View article]
    Chris Crane, from EXC, is the new CEO post-merger.

    My brief google search was unable to determine the exact role Mr. Shattuck III will play in the new company, but it is very likely he will remain involved with BGE.

    I assume you live in the Baltimore area and aren't happy with the 72% increase in electricity prices since deregulation began in 1999. Mayo Shattuck III has also gained public scrutiny for excessive compensation (while running his business into the ground).

    Mr. Shattuck had no experience in utilities prior to CEG and is unlikely to be an important part of the company going forward, thus giving him the free time he will need to make another run at becoming commissioner of the NFL.
    Feb 20 09:43 PM | 3 Likes Like |Link to Comment
  • The Coming Decade Of Stocks [View article]
    while i happen to agree with you on GE, those normalized 10 year earnings include a big chunk of earnings from a highly leveraged GE Capital division that will no longer be making the same contribution to forward earnings. I like the prospects of GE with regard to power infrastructure. Even if you discount the 25-30% of earnings that comes from financial services GE can still earn $1.50 per share and double from here.

    I know you still have 9 stocks to come, but if you're looking at a return to normal I'd love to hear your thoughts on how to invest for interest rates above 0%. In theory, rising rates are bad for companies like GE that require huge capital investments to fund new infrastructure projects.
    Nov 29 11:07 PM | 3 Likes Like |Link to Comment
  • Shorting Student Loans: The Next Major Credit Bubble [View article]
    If you are going to paraphrase the work of Steve Eisman (2010) and Jim Chanos (2011) from the Ira Sohn Conference you should at least provide links to your source material.

    www.marketfolly.com/20...

    app.streamsend.com/c/1...
    Jul 5 10:06 AM | 3 Likes Like |Link to Comment
  • The Short Case for Microsoft [View article]
    i try not to bet against buffett, and he said at his conference over the weekend that he wanted to own a part of MSFT but was afraid of conflict of interest b/c of his relationship with Gates
    May 2 01:13 AM | 3 Likes Like |Link to Comment
  • Top 5 Tobacco Producers Paying Substantial Dividends [View article]
    think about the relation between taxes and state revenues as a bell curve where excess taxation costs the public money and incentivizes illegal market activity and under taxation costs the public money and results in waste. Example, the true cost of leaving your lights on is under taxed and results in misallocation of resources, whereas "sins" are over taxed and result in capital loss and increase in crime rates. As for income and sales tax, the bell is probably flatter allowing for slightly lower loss rates as you move right on the scale, but yes there is a point at which sales taxes disrupts sales and at which income tax dis-incentivizes productivity. There is an old russian joke from the soviet era, "the people pretend to work and the government pretends to pay us".
    Apr 18 06:38 AM | 3 Likes Like |Link to Comment
  • The Fundamental Flaw Of Stock Indexes [View article]
    I have a technical objection

    you claim that indices buy high and sell low

    but in practice, once the original index purchase is made the index does not buy or sell any stocks - the cap weighting is just the result of market fluctuations (unless the index changes constituents)

    So its a bit of a fib to say that index funds buy high - the just buy and hold.
    Oct 17 06:09 PM | 2 Likes Like |Link to Comment
  • Can Passivity Be Enhanced? Why Smart Beta Strategies Are Suddenly In Vogue [View article]
    smart beta is just another way to describe quant funds. They assume that some set of metrics will result in outperformance and create a fund that tracks those metrics.
    Aug 14 06:57 AM | 2 Likes Like |Link to Comment
COMMENTS STATS
195 Comments
228 Likes