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Brian Abbott  

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  • Why Amazon Has No Profits (And Why It Works) [View article]
    Big Foot - good analysis. Don't forget the old saw "Yeah, we're losing money but we'll make it up on volume" - sums up AMZN business model pretty well. And "just trust us, we're re-investing for the future" while Bezos sells out his shares hand over fist today. Reminds me of the guy on Popeye who said "I'll gladly pay you Tuesday for a hamburger today"
    Sep 6, 2014. 12:59 PM | 2 Likes Like |Link to Comment
  • Why Amazon Has No Profits (And Why It Works) [View article]
    drones... what a sideshow. You can have a courier deliver something same-day currently.... and at what cost? why would we think that a drone delivery will be cheaper than that? (and a cost that very few people would pay)
    Sep 6, 2014. 12:14 PM | 2 Likes Like |Link to Comment
  • Alibaba aims for $148B-$163B IPO valuation [View news story]
    I won't comment on the valuation of Alibaba among such esteemed analysts, but I just wanted to remark that as the largest IPO of all time, how does this not mark some kind of top?
    Sep 6, 2014. 11:53 AM | 2 Likes Like |Link to Comment
  • Today's Market: Is Amazon's Smartphone A Game Changer? [View article]
    smartphones..... now there's a high margin market just waiting for a new entrant
    Jun 5, 2014. 01:35 PM | 2 Likes Like |Link to Comment
  • Dividend Growers Portfolio That Has Outperformed The Market [View article]
    I love the portfolio and found that I already own 5 of the ten you mentioned. VR and NE are my two largest holdings. It is always hard to hold the things that are disliked the most by the market. Good luck to everyone following a contrarian strategy.... it isn't easy but hopefully will pay off. Thanks for writing - great article and it should provoke some discussion.
    Apr 30, 2014. 09:21 AM | 2 Likes Like |Link to Comment
  • Aspen Insurance Holdings: Discounted And Shareholder Friendly [View article]
    I've been lucky enough to sit next to a few reinsurance brokers (Willis Re, AON) on flights. Insight from them is that it is EXTREMELY competitive. There is a lot of capital chasing risk these days. The low yield environment is driving mispricing across all asset classes, and the risk business is no different. What is hiding it right now is a benign risk environment.

    A lot of the gains in the stocks themselves is due to one-off event, like price to book closing the gap from 70% across the industry to now 95-100%, some even higher than 100%. Even if that is just a reversion to the mean, it is a one-off event. Price to book is not (or should not) go over 110%, at least historically. So much of those gains aren't going to be repeated, and that leaves you with a business growing premium at around 6% and earning 1.5% on their bond portfolio in reserves. That's not a lot of compensation for the catastrophe risk many of these companies take. Cats don't happen every quarter, so earnings are lumpy for ones with heavy reinsurance focus. Don't mistake the closure of the price to book value gap as a repeatable part of their business model.

    One last note: share buybacks have fueled some of that P/B gap closure, and buybacks aren't accretive anymore once P/B is at 100%. They make a ton of sense when P/B is 60-70% because it's like getting an instant 30% return on capital. they make almost no sense at 100%.
    May 9, 2013. 09:24 AM | 2 Likes Like |Link to Comment
  • Aspen Insurance Holdings: Discounted And Shareholder Friendly [View article]
    <I>if the future tends to be as redundantly reserved as the past, then there will be reserve releases which will make tangible book increase.</I>

    That's a nice way to look at it from a conservative standpoint, but one could just as easily say they left money on the table by not writing to their full capacity. If there is a mega-cat, they'll look like geniuses but in a benign risk environment they are putting a drag on profitability.

    Great article. AHL is one of my favorite companies!
    May 8, 2013. 08:57 PM | 2 Likes Like |Link to Comment
  • Attempting To Mimic The Yale Endowment Portfolio Using ETFs [View article]
    yes, and I saw an article with a high profile forecast calling for continued low returns in hedge funds for the next 5 years (5% range of returns). That's a killer when you layer on all the fees they charge.
    Jan 29, 2013. 09:21 AM | 2 Likes Like |Link to Comment
  • The 'Too Big Of A Market Cap Stock' Theory [View article]
    the financial theory would be that going forward, the market is predicting that said firms will destroy capital. I am holding INTC, but the valuation makes me nervous that the market knows something I don't
    Jan 20, 2013. 12:26 AM | 2 Likes Like |Link to Comment
  • Can You Retire With A $1,000,000 Portfolio? An Urgent Follow Up [View article]
    Please.... tell us more about how it should be.
    Jan 16, 2013. 10:40 PM | 2 Likes Like |Link to Comment
  • Can You Retire With A $1,000,000 Portfolio? An Urgent Follow Up [View article]
    it is like an annuity that doesn't deplete. it's only a return of capital because the returns of all asset classes are lower than when the fund was designed.The concept of using including non-traditional, endowment-style asset classes in a retirement fund that also pays monthly distributions is a novel concept. You could get someone like Fidelity or even Goldman Sachs to do this, only for a much higher fee, and of course their returns won't be any higher because we are in a low return environment. The ROC isn't a flaw of the fund, it's just a symptom that we're in a low return environment. Anyone living off their self-managed retirement assets would end up in the same situation, but they'd have to sell assets themselves to maintain equivalent payouts compared to what this fund products.
    Jan 5, 2013. 08:56 PM | 2 Likes Like |Link to Comment
  • This Benjamin Graham Rule Encourages More Disciplined Investing [View article]
    Great article! Summarizes something I have felt throughout the 20 years I've been investing, but never have seen articulated so well.
    Dec 30, 2012. 11:43 AM | 2 Likes Like |Link to Comment
  • 6 Criteria for Picking Great Stocks - And 6 Stocks That Make the Grade [View article]
    sethmcs- that's the classic value / unloved stock approach, which I also favor. My own value criteria are low price/book along with low PE, good history of either using retained earnings well or else distributing to shareholders by issuing dividends or preferably buyback, with a peek at free cash flow. (Reinsurance companies and offshore drillers come up frequently on these screens, and are my two biggest sectors)
    Jan 25, 2011. 09:25 AM | 2 Likes Like |Link to Comment
  • The New Version of Depression Apple Selling [View article]
    The day laborers used to be from Mexico and central america. When times were good for the economy, little attention was paid. Now that times have changed and it's Americans hanging out for day labor jobs, we're supposed to feel sorry for them? There were people doing this for years, and we used them for cheap labor as a society. I would like to see our society be a little more consistent in our sympathy.
    Nov 8, 2009. 01:41 PM | 2 Likes Like |Link to Comment
  • Bill Gross PIMCO Exit Creates Unprecedented Value In CEFs [View article]
    Now that gross manages a 12M fund barrons shouldn't even invite him back
    Sep 28, 2014. 01:35 PM | 1 Like Like |Link to Comment
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