Seeking Alpha
View as an RSS Feed

Bill Wolf  

View Bill Wolf's Comments BY TICKER:
Latest comments  |  Highest rated
  • Why Netflix Could Be Bankrupt Within A Year [View article]
    streaming costs are only "debt" as you term them and paid back with "net income" if you consider their cost of goods sold as 0. Streaming costs are discharged through COGS, so your analysis is 100% flawed. Streaming content deals are their inventory, not debt. Does any company "pay" for their inventory by charging COGS when matching revenues are recorded? Yes, just as Netflix will.

    When you say, "So to summmarize, as of 6/30/11, Netflix had $175 million in cash. Most of its other assets consist of the streaming content library that has an expiration date. They've made $128 million in net income year to date, and have generated negative cash flow YTD (-$19 million). Yet Netflix owes $1.157 billion within a year." you demonstrate little understanding of their financial model. True debt doesn't get discharged through Cost of Goods Sold. Future inventory purchases will and thus are essentially paid off by revenue, not cash on hand or net income. Their revenues EASILY cover any obligation they have undertaken on the streaming content, with a nice margin to boot.
    Oct 11, 2011. 01:14 PM | 8 Likes Like |Link to Comment
  • A Value Investor's Case For Clearwire [View article]
    Cale, very good write up. Nice work.

    One thing I think that has been missed in the analysis of the overall performance of CLWR stock (since March or so, down from $6) is that in a deflationary, credit crunch affected world, highly levered entities suffer. You note that equity dilution fears seem misplaced, but the overall funding environment is poor and worsening. This gives less margin of error for the operating results over the next 18 months. May not be rational or fair, but it is reality when you are not relying solely on internally generated capital. Equity dilution fears would be overblown in a global macro environment of expanding credit. Unfortunately, that is not the times we find ourselves in.

    Again, good analysis.
    Sep 28, 2011. 10:50 AM | 2 Likes Like |Link to Comment
  • Medifast's Revenue Projections: Doubtful the Sell-Side Is Right [View article]
    Ghutchin,
    Yes. Rapidly slowing growth in an industry prone to fads is a very dangerous recipe. Given the growth trajectory, the sellside has put forth earnings estimates that I don't believe are achievable. Many are basing their long position on "this stock is cheap" on forward earnings estimates. If it becomes apparent that those earnings estimates are too high, they will lose their appetite for a long position in what I consider a risky stock.
    Jun 8, 2011. 04:05 PM | Likes Like |Link to Comment
  • Microsoft's Blind Bulls [View article]
    Boy this looks just like a business that is about to fall off a cliff and die in 2 years...
    Revenues from FY-Q1 2005 to FY-Q1 2011
    climsy.com/7Xkdal4k0b.jpg
    Remember, Google Docs launched in June 2006... Big impact there!
    Operating Income from FY-Q1 2005 to FY-Q1 2011
    climsy.com/7Xkd4l4k0b.jpg

    Remember, at 8X earnings (and with FCF equaling earnings), in about 8 years they could buy back the whole company if earnings are just flat...

    May MSFT be gone in 20 years? Yes, but its priced as if its going away in 4. As Pygmalion mentioned, price matters, and the downside is priced in.
    Apr 14, 2011. 05:38 PM | 8 Likes Like |Link to Comment
  • Putting Consumer Debt in Context [View article]
    Saj, i generally agree with things you write but this one I find lacking. Your definition is mistaken as its not, "the ratio of required mortgage and consumer debt to disposable personal income", but rather the required interest payments on said debt. You probably meant this but obviously its a huge difference. Moreover, rates are at all-time lows. You usually point out reversion to the mean, and this is a case where reversion to the mean of rates would bury a shocking amount of borrowers. Consumers are in a precarious position seeing as interest rates are so low (including mortgage rates). Much of this is due to unsustainable government interference. If you adjusted to normalized interest rates, consumer debt service would likely be 2-3X higher and off the charts. In my opinion, a better methodology would be debt-to-income, not debt service given the interest rates in place.
    Sep 17, 2010. 04:00 PM | Likes Like |Link to Comment
  • Recent Rail, ISM Reports: Is Economic Activity Increasing or Decreasing? [View article]
    and the YoY growth in carloads went from 14% in June to 7% in the latest reading... that's bullish...
    Sep 2, 2010. 04:05 PM | Likes Like |Link to Comment
  • Why July's Weak Capital Goods Orders Were Possibly Misleading [View article]
    LOL!
    Aug 25, 2010. 01:44 PM | 3 Likes Like |Link to Comment
  • Is DeVry the Next Private Equity Target? [View article]
    Note that Carlyle has a relationship with Apollo Group (APOL), in that Carlyle is invested in Apollo Global, a JV between the PE fund and the education giant that does investments in education related entities outside the US...

    www.carlyle.com/Portfo...
    Jul 16, 2010. 02:40 PM | 1 Like Like |Link to Comment
  • Helicopter Drop Time: Paul Krugman Gets One Wrong [View article]
    In simplistic terms, do you think dropping money from a helicopter adds any wealth or value to our economy over the long run? If you really think that it might, why isn't that a function that we do all the time, or why doesn't some private enterprise take such an activity up? Absolutely silly, destructive and nonsensical advice from Krugman and DeLong. The author needs to back up and think about logic for a minute, instead of formulas and potential esteem amongst other academics...
    Jul 15, 2010. 04:35 PM | Likes Like |Link to Comment
  • The Number Receiving Unemployment Insurance Is Down 25% [View article]
    Always optimistic, and likely losing clients' money nearly as often...
    Jul 1, 2010. 04:18 PM | 3 Likes Like |Link to Comment
  • U.S. Conservatives Too Influenced by Mistakes of the Austrian School [View article]
    You need to do some reading on Austrian economic school of thought. The point is that the excesses wouldn't be as extreme without government intervention (primarily the federal reserve). Yes, they acknowledge that greed can fuel overinvestment. But, their position is that without free money (provided by central bankers), the train doesn't leave the station AND have fuel added as it heads over the cliff.
    Government had nothing to do with accounting abuses? How do you think the GSE's were set up? Don't you realize they became a tool of the push for "affordable housing"! Don't you realize that the quasi-government backing (ie original intervention to subsidise housing) led to an assumption that the GSE's debts were guaranteed by the government, and that led to further government intervention?
    Also, who do you think wrote legislation requiring ratings, and also setting up an oligopoly to provide those ratings? Government? Maybe? Oh yes!!! That's not a market based solution.

    You sight private short-sightedness, unrestrained greed, and accounting abuses and credit ratings all caused this crisis. The government is behind every one of those reasons with free money (easy credit) and legislation creating special entities. Do a little more research before publishing such gibberish...
    Jan 28, 2010. 10:57 AM | 15 Likes Like |Link to Comment
COMMENTS STATS
56 Comments
85 Likes