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  • GrafTech: Cost Optimization, Hidden Asset, And Panic Selling Offer Outstanding Upside For Contrarian Investors After 60% Sell-Off [View article]
    On Q3 2014 results:
    (1) Guidance for full year is unchanged
    (2) Write-offs due to GT Advanced Technology bankruptcy filing of c$5 million: this had no analyst in his estimates and explains 100% of the so perceived miss.
    (3) Extent of drop in thermal management for consumer electronics was enormous (-26%), but should we expect Samsung to go out of business? Japanese Wacom reported tonight that mass production of Samsung Galaxy Note 4 had been shifted out. Samsung reported they reduced tablet production to clear excess channel inventory, and AAPL replacement demand will also, in my view, accelerate upon innovation (iPad Air Pro next year). Share price drop following Sep 24 warning wiped-out complete value of ES-business.
    (4) Management said decant oil prices (key raw material for own needle coke production) should fall in line with crude oil prices. GTI tries nonetheless to establish price increases in graphite electrodes after sharp drops of recent years. I expect more modest price increases than the 10% GTI is dreaming of, but:
    a) price increase in G/E
    b) lower decant oil and therefore needle coke costs (41% of COGS)
    c) high capacity use due to capacity cut by 60kMT, plus additional cost savings.
    (5) A core shareholder, whose board influence is not backed by actual capital exposure, and a short-interest that needs to be covered. GTI - About to be taken over? http://bit.ly/1rlWI3Y
    Oct 31 11:04 AM | Likes Like |Link to Comment
  • More on GrafTech's Q3 [View news story]
    On Q3 2014 results:
    (1) Guidance for full year is unchanged
    (2) Write-offs due to GT Advanced Technology bankruptcy filing of c$5 million: this had no analyst in his estimates and explains 100% of the so perceived miss.
    (3) Extent of drop in thermal management for consumer electronics was enormous (-26%), but should we expect Samsung to go out of business? Japanese Wacom reported tonight that mass production of Samsung Galaxy Note 4 had been shifted out. Samsung reported they reduced tablet production to clear excess channel inventory, and AAPL replacement demand will also, in my view, accelerate upon innovation (iPad Air Pro next year). Share price drop following Sep 24 warning wiped-out complete value of ES-business.
    (4) Management said decant oil prices (key raw material for own needle coke production) should fall in line with crude oil prices. GTI tries nonetheless to establish price increases in graphite electrodes after sharp drops of recent years. I expect more modest price increases than the 10% GTI is dreaming of, but:
    a) price increase in G/E
    b) lower decant oil and therefore needle coke costs (41% of COGS)
    c) high capacity use due to capacity cut by 60kMT, plus additional cost savings.
    (5) A core shareholder, whose board influence is not backed by actual capital exposure, and a short-interest that needs to be covered. GTI - About to be taken over? http://bit.ly/1rlWI3Y
    In my view, the drop in the share price has nothing to do with results. It was pushed up towards $5 on purpose to open a short-trade into results (which was hedged with $5-strike calls. These Calls are still around and can be used again, when successful short-trade is closed and share price goes up again. It is time the SEC has a look on trading behavour in this stock.
    Oct 31 10:53 AM | Likes Like |Link to Comment
  • GrafTech - About To Be Taken Over? [View article]
    Short interest per Oct. 15 delined 4.6m shares to 10.7m from Sep 30 to Oct 15, and SI is down 8.2m shares in the time Sep 15 to Oct 15. The short interest per Oct. 15 is now 4.6m below the Milikowski stake of 15.3m and I would expect SI to have fallen further since the reporting date. GTI will publish Q3 results on Thursday (Oct 30). It will be interesting to see whether Management will buy shares after the release of results. They are likely not in a position to do so ahead. Insider buying at a time of low visibility due to severe restructuring would likely provide strong support for the share price.
    Oct 27 02:49 PM | 1 Like Like |Link to Comment
  • GrafTech - About To Be Taken Over? [View article]
    GTI short interest per Oct 15 is due for release on Friday, Oct 24 (after close of trading). Look for a reduction in short interest, which stood at 15.3m (matching the Milikowsky stake) per Sep. 30, but beware that SI could well be unchanged although stock is collected for closing this short.
    Oct 22 11:46 AM | Likes Like |Link to Comment
  • GrafTech: Cost Optimization, Hidden Asset, And Panic Selling Offer Outstanding Upside For Contrarian Investors After 60% Sell-Off [View article]
    I prefer driving in a bus where it is not up to the driver to throw me out of the vehicle somewhere on the way. This bus would potentially reach the destination I wanted to go to, but I might find myself sitting somewhere I never wanted to be. If M has been fully hedged on its stake, but claimed he is the one with the most skin in the game when going for votes, if he has also misrepresented the performance of old management in order to be elected, then I would not feel comfortable to be completely dependent on him. He needs to buy shares to get actual exposure to the company. If there are other buyers that challenge his dominance, he will have to buy at higher prices to underpin his claim for control with a sufficiently strong holding. If other holders are indifferent to his dominance on the board, he might find opportunity to collect stock on the very cheap. I prefer a rising share price trend and a board that is in the position to control M squared (Management, Milikowsky).
    Oct 21 11:34 AM | Likes Like |Link to Comment
  • GrafTech: Cost Optimization, Hidden Asset, And Panic Selling Offer Outstanding Upside For Contrarian Investors After 60% Sell-Off [View article]
    IM capacity cut was in place w/o M (not justified for M to claim credit as GTI competitor SGL acted likewise). Two other restructuring steps mirror M suggestions. Impairments and share Price derating help M if he was hedged on his stake (SI per Sep 30 matched his stake). I do not question that a more active board is helpful. I am however worried about M having too much influence and I cannot believe that this will turn out to the benefit of outside Investors if it is not corrected. For now M Needs to remove hedge and to build up his stake. I hope the larger mutual funds get this and wake up in Terms of the board issue.
    Oct 21 03:01 AM | Likes Like |Link to Comment
  • GrafTech: Cost Optimization, Hidden Asset, And Panic Selling Offer Outstanding Upside For Contrarian Investors After 60% Sell-Off [View article]
    Dear Stan, every single of your arguments was equally valid when the stock stood at $8 a few weeks ago. M is not taking this effort for you and me. He is taking this effort for himself. And he is not aiming to pay more premium than necessary. If you control 3 in 7 seats and you have one other director on your side - however you bring this about - you have control of the board. And there are decision that will be taken differently when the yardstick is M's as opposed to the benefit of all shareholders. To put it pluntly: with M having too much power I might be offered $6 or $7 in a bid (if I am happy). IF IM recovers and ES does grow, the stock could go into the teens (admittedly with a far different investment horizon).
    Oct 20 10:40 AM | Likes Like |Link to Comment
  • GrafTech: Cost Optimization, Hidden Asset, And Panic Selling Offer Outstanding Upside For Contrarian Investors After 60% Sell-Off [View article]
    Get it: Milikowsky is part of the problem and not part of the solution. However, he is also part of the attractive entry opportunity which we would not have seen w/o him. If remaining fund managers wake up, we might end up with more investors than M going for the shares. This is the upside. People need to recognize the value creation that they could be part of and that they won't be part of if M stays on the board. Action required.
    Oct 20 09:21 AM | Likes Like |Link to Comment
  • GrafTech: Cost Optimization, Hidden Asset, And Panic Selling Offer Outstanding Upside For Contrarian Investors After 60% Sell-Off [View article]
    The Problem is Milikowsky on The Board. The risk is him collecting stock (whatever Way)or trying to Take comp private at disadvantage of outstanding shareholders. If you Sell ES as a second step The comp has very Little net debt (Change in Control could require Sellin ES). For This, M Needs to have a very positive Long-Term View on IM Business. I Share This positive View and I want to participate in The upside. And I Do not want to See ES Sold, but to form a newco with another Player that benefits both parties. Share Price Needs to go up and mutual Funds Need to remove M as quickly as possible.
    Oct 19 05:18 PM | Likes Like |Link to Comment
  • October Is Not Too Cold For Shorts [View article]
    This title is really great!
    Oct 17 05:17 PM | Likes Like |Link to Comment
  • GrafTech: Cost Optimization, Hidden Asset, And Panic Selling Offer Outstanding Upside For Contrarian Investors After 60% Sell-Off [View article]
    ...with eyes wide shut re what is actually going on. :o) http://seekingalpha.co...
    Oct 17 12:41 PM | 2 Likes Like |Link to Comment
  • It Is Not Ebola That Is Out Of Control, It Is The Media [View article]
    I call it the "Bloomberg-Crash". They created fear about German orders, production and trade figs for August, that were distorted by shifts in holidays plus distortions due to Ukrain/Russia. They pushed Ebola around the clock. And when panicking Americans tried to hedge by selling the DAX, there is of course no obvious buyer to take this up. The performance is little surprising - and when you look for a reason, the weak economy can easily serve as a fundamental excuse for the nonsense going on. German companies are global players! Daimler delivered record results! In the bond market, this has been an excellent opportunity for those trading on European QE (not getting it) to exit their positions with a gain. I would not wonder to see a another record result from GS.
    Oct 16 12:11 PM | Likes Like |Link to Comment
  • GrafTech - About To Be Taken Over? [View article]
    Dear Gloria, if Mr Milikowsky is interested in the benefit and well being of GTI and all shareholders (rather than his own), he would simply agree to shift-out maturity of his 200m subordinated loan to GTI by one or two years. There is hence no liquidity (and rating) thread to M - as opposed to GTI and outside shareholders. Also, it looks as if M told outside investors that he has, as the largest independent shareholder in GTI, the highest skin in the game und asked for support of outside shareholders to "save Graftech" by supporting him to get back to the board of the company. In case his stake has been hedged, and he did not disclose this while asking for the votes of outside shareholders, he should be removed from the board as quickly as possible - in the interest of all shareholders other than M. Whether GTI will fail to produce sufficient liquidity to repay his loan or to secure another to replace it is highly speculative at this point - This discussion is serving the purpose to bring the share price down (for a buyer, and possibly one who could easily himself remove this threat). The company could issue preference shares to repay the subordinated note, if necessary. The note produces interest cost of 7%. Preference stock would probably not be so much more expensive. There is one overriding necessity at this point: the share price needs to go up to prevent that a certain person can collect too much shares on the cheap.
    Oct 14 03:19 AM | 1 Like Like |Link to Comment
  • The German Financial Institutions: What's The Difference? [View article]
    Your share Count fort DB is erratically wrong, c1.4bn as of now, and so are bookvalues. Your BVPS must have been USD on The 2013 share Count.
    Oct 11 03:04 AM | 1 Like Like |Link to Comment
  • GrafTech - About To Be Taken Over? [View article]
    Who is we? Why are you always taking the position of "Save GrafTech"? You were right, but this is more than in the price. A lot of macro things went wrong for GTI. However, there is a very interesting long-term story to this stock that may play out. My next article :o) M could have sold his stake. He went for influence on strategy while talking management down. He would not do so if there was not long-term positive perspective to him as well. It is poor capitalism if some benefit at the expense of others.
    Oct 10 06:25 PM | Likes Like |Link to Comment
COMMENTS STATS
298 Comments
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