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Brad Ferris

 
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  • Has Buffett Lost His Mind? [View article]
    I think its a simple situation of Buffett realizing the worth of a well run company and having little problem overpaying (by today's standards) for future earnings that will be much higher than today's. He has shown this ability time & time again because he rationalizes his purchases different than most investors. BNI is a very good company, but don't except 30% returns for the next 10 years; it's not that type of company. What it will offer is a very good operating foundation for BRK to diversify out of so much insurance and consumer products companies. Essentially someone has to ship all that Coke, Kraft Dinner and JNJ Baby Shampoo :)
    Nov 23 06:50 AM | 4 Likes Like |Link to Comment
  • 3 Must-Know Options Strategies for Dividend Investors [View article]
    Good introductory content on options. I agree with DGI though on reading Taleb for insights into how options work and how to make them profitable in your investing activities.
    May 4 09:47 PM | 4 Likes Like |Link to Comment
  • Who Might Benefit From Detroit's Failings [View article]
    I think everyone benefits over the long-term if GM fails. Clearly there will be hardships in the short-term, but what's really at issue is the viability of a business. Chapter 11 is the solution to that, not more money for restructuring.
    Dec 3 07:23 PM | 4 Likes Like |Link to Comment
  • Developing A Margin Of Safety [View article]
    The purpose of a margin of safety is to build a discount into the price I pay for a stock. If it doesn't work for you don't use it. It works very well for me as one metric in assessing whether a price is appropriate or not. It's not my sole decision making criteria; simply a tool to help me be successful.
    Jan 31 04:27 PM | 2 Likes Like |Link to Comment
  • If This Is a Recovery... [View article]
    Taxes are going to rise or new taxes will be created as all levels of government attempt to deal with their revenue shortfalls.
    Nov 15 10:35 PM | 2 Likes Like |Link to Comment
  • Lessons From Madoff: You Would Have Missed Buffett Too [View article]
    It's amazing really that investors don't demand better transparency for the money they entrust to those who manage their money. Investors need to demand stronger oversight and conflicts of interest need to be weeded out of the regulators so the proper job can actually be done. This would never fly in the pharmaceutical industry or with many of the largest regulated utility companies.
    Dec 25 10:21 PM | 2 Likes Like |Link to Comment
  • When To Sell Your Stocks [View article]
    Thanks for the positive feedback everyone!
    Apr 10 08:59 PM | 1 Like Like |Link to Comment
  • Developing A Margin Of Safety [View article]
    Yes but that's what distinguishes a value investor for someone with another approach. There aren't too many equities I invest in because of safety. I'd rather make 6-10% consistently each year while never losing money than have wild swings in my returns.
    Jan 30 04:32 PM | 1 Like Like |Link to Comment
  • Chinese Exports: Can Emerging Markets Replace the U.S. Consumer? [View article]
    Emerging markets won't replace the US consumer in the next 5 years, but certainly the trends in population & economic growth indicate that they'll play a much bigger role in how goods and services are targeted by international companies. The US consumer (and government) has many problems right now, but EM's aren't in a position, yet, to take over as the dominant consumer over the next few years.
    Nov 15 10:38 PM | 1 Like Like |Link to Comment
  • An Investor's Guide to Corporate Bonds [View article]
    Thomas: Thanks.

    Jimmy: Bonds are issued by companies at a part value - what an investor pays includes costs and commissions and can be more or less on the open market. Feel free to take the time to re-write your own post on corporate bonds highlighting all this "misinformation" and we'll compare notes.
    Mar 30 01:41 PM | 1 Like Like |Link to Comment
  • Securing Cheap Financing May Just Be Canadian National Railway's Biggest Asset [View article]
    CNR is the Canadian ticker on the TSX and the common name I use for the company since I am a Canadian author. If you notice early in my original post (on my site) I refer to Canadian National Railway as (CNR;CNI). The Seeking Alpha editors took that out. As for my disclosure I own CNR (TSX), not CNI (NYSE).
    Feb 24 08:22 AM | 1 Like Like |Link to Comment
  • Parsing Crocs' Income Statement [View article]
    That's a great analysis Jae - especially demonstrating how poor the numbers in the Income Statement are for Crocs.

    Margins matter and I think investors don't pay enough attention to them. That's where money really matters for companies and you can have all the hype in the world for a product or service, but margins always tell the story about the sustainability of the business model.
    Jan 21 12:57 PM | 1 Like Like |Link to Comment
  • America's New Stimulus Package: Looks Good, But Is It Enough? [View article]
    No...it won't be enough. For the simple reason that in part they're still attempting to stimulate consumption and bad companies need to die. It's really that simple. A WFC or JPM needs to come in & buy Citi for cents on the dollar and acquire its deposits and functional business segments. There's just far too much financial supply and when we see meaningful failures I think that is when stimulus begins to work. Interest rates are already historically low. Consumers and businesses are conserving cash because their cost/ability to secure financing is so high.
    Jan 20 05:22 AM | 1 Like Like |Link to Comment
  • How the Treasury Bubble Will Burst and Why [View article]
    Fair analysis and presentation. I think tresuries have further to go than investors think - look how long certain individuals were talking about the commodity and/or credit bubble over the last 5 years.
    Jan 20 05:18 AM | 1 Like Like |Link to Comment
  • Manulife Financial: Enduring Value [View article]
    abcde,

    In my DCF I use a 5 year time line. The reason for this is for many reasons, but it gives me an adequate time period to observe operations for any fundamental shifts in operations, proftiability or important metrics I use to evaluate a stock.

    My growth rate is constant for the 5 year time period. Since I use an [ROE/PB + BV growth] model based on historic data for the company and a current PB I feel it gives me a very conservative growth rate that eliminates EPS volatility that many investors like to focus on.

    I think with #3 you might see my reasoning for avoiding EPS as a metric for determining my growth rate. I don't know where earnings will go - so I'm buying the stock for today's earnings (or what I expect them to be). The company can still grow on a value basis without any meaningful increase to EPS to satisfy my needs as an investor. EPS could shrink or stay constant and BV could increase considerably still adding value in my eyes as a shareholder of the business.

    The growth rate for the company has been constant since it went public and their business model, IMO, won't change drastically because of this crisis. Yes profitability for the banks will decrease because of the elimination of leverage from their operations but MFC and other high quality insurers weren't leveraged to begin with. As they begin to move into banking operations with new products I see them as growing businesses.

    A 10% dilution was a possibility but I think the company demonstrated today with its earnings release and disclosure of a loan that it intends to protect shareholders from the markets effects for the meantime. I still see them as active acquirers in this environment.

    Hope that helps.
    Nov 6 08:45 PM | 1 Like Like |Link to Comment
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53 Comments
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