Is Microsoft The Ultimate Value Trap? [View article]
I stopped reading when you noted that they haven't laid a golden egg "since the Windows operating system." Are you familiar with their server and tools business? SQL?
3 Reasons TravelCenters Of America Could Triple [View article]
TA may in fact be cheap. But allow me to offer some risks/concerns, as the author ignored some:
1) The trucking industry is facing huge competition from rail with oil still at historically high prices. It's more cost efficient to run a lot more freight by rail than it was when diesel was cheaper. Both industries have high fixed costs-rail is enjoying benefits from leveraging those fixed costs while trucking (and truck servicing/fueling) has been suffering. 2) The business is hardly "best in breed". The industry is a cost of capital type, is very capital intensive-even for TA, which has to fund a lot of capex out of its own pocket. 3) TA lost nearly $21/shr cumulatively from the time of spin-off through 2010. 4) TA has a lot of cash, but it also has $150 million in deferred rent which is due at the end of the lease terms, in 2022 and 2024. 4) TA's agreement with HPT was not arms-length. Their CEO worked for both companies, and after the lawsuit HPT had to agree to defer the above rent, interest free. It's nearly impossible for an investor to determine whether the current lease agreement is fair.
I agree TA is kind of a lottery ticket-big potential upside. But they are stuck with very high fixed costs, and are uber-cyclical and economically sensitive. There's a major risk the stock eventually goes to zero.
Microsoft: Defenestrated By A New Paradigm [View article]
IDG surveyed "IT and business professionals". It's hard to envision any IT professional completing keyboard-intensive tasks on an iPad. It's useful in the board room and on the couch but painstakingly inefficient for most business tasks. Only 6% said that it had replaced their desktop, and the survey doesn't differentiate between those who gave up one but not the other. They also said "For most, the iPad isn't a substitute for an existing tool or device," IDG said. "Instead, it's a supplement, albeit one with functionality that overlaps with other devices. As a result, the iPad seems to have carved out a niche for itself at the partial expense of several rival form factors."
StoneMor's Misleading Press Release: The Short Case Continued [View article]
I'll respond to the latter. As to the Motley Fool, I think that's a reflection of retail sentiment among yield hungry investors who own it for the yield. As to the Wall Street recommendations, the two major houses who cover it-Baird and Raymond James-were the ones who did the last big stock offering in Feb 2011. And they don't seem to be actively covering it. The last change in opinion was a little over a month after the offering.
StoneMor's Misleading Press Release: The Short Case Continued [View article]
Yet another "you don't get MLPs". It doesn't matter if it's a REIT, a BDC, or an MLP...bad economics is bad economics.
STON's track record of acquiring new properties while issuing shares has on net been highly dilutive. Revenue per share dropped from $17.10 in 2007 to $11.77 in 2011, a 32% decline. And this was accompanied by dramatically lower margins and cash flow conversion.
If you want to talk about return of capital, here's a number for you: 40 cents. That's the amount, per share, in cemetery property that the co converts to cash each year. It's about what the company is capable of paying out in distributions without inevitably collapsing.
The Impending Implosion Of StoneMor Partners [View article]
It was. It was founded when Loewen dumped their decent properties into a new vehicle, management jumped ship, and Loewen subsequently went bankrupt. Loewen also survived for a long time, but collapsed quickly.
An Analysis of 4 Chinese Advertising Businesses [View article]
If you haven't read it, go and read O'Glove's "Quality of Earnings", particularly the section "don't trust your auditor". And then multiply it by 100 for anything based in China. If you aren't extremely skeptical of every Chinese reverse merger, you have your head in the sand.
Very much looking forward to the pending CCME news....
China MediaExpress: The Most Undervalued Stock Poised to Profit From China's Emerging Middle Class [View article]
They have 72% operating margins. Find me another advertising co that does. Focus Media's are around 20%. Why are margins so high? Because their dominance has been granted by the gov't, through an agreement that lasts until Oct 2012. They have 80% market share on intercity buses in big cities and 55% in small cities. The question is whether this is sustainable. At current revenues and a 20% operating margin, earnings would be about $0.80/shr.
"CME believes its status as the sole strategic alliance partner designated by an entity affiliated with the Ministry of Transport and the exclusive rights to display advertisements on the system has facilitated its historical expansion and is expected to continue to provide them with a competitive advantage in the future...The cooperation agreement also gave CME exclusive rights to display advertisements on the system."
T-Mobile's Bad Side: Too Much Debt And Too Little Equity For PCS [View article]
Interesting article, thanks as always Chris. But the risk/reward is demonstrative of how little value/opportunity there is in this market on the long side. If the past 2 years are any guide, maybe that changes in the next 6 months.....
Is Microsoft The Ultimate Value Trap? [View article]
What Cisco Was to the Dot Com Boom, Apple Is to Current Euphoria [View article]
A Look at Dry Bulk Company Valuations [View article]
3 Reasons TravelCenters Of America Could Triple [View article]
1) The trucking industry is facing huge competition from rail with oil still at historically high prices. It's more cost efficient to run a lot more freight by rail than it was when diesel was cheaper. Both industries have high fixed costs-rail is enjoying benefits from leveraging those fixed costs while trucking (and truck servicing/fueling) has been suffering.
2) The business is hardly "best in breed". The industry is a cost of capital type, is very capital intensive-even for TA, which has to fund a lot of capex out of its own pocket.
3) TA lost nearly $21/shr cumulatively from the time of spin-off through 2010.
4) TA has a lot of cash, but it also has $150 million in deferred rent which is due at the end of the lease terms, in 2022 and 2024.
4) TA's agreement with HPT was not arms-length. Their CEO worked for both companies, and after the lawsuit HPT had to agree to defer the above rent, interest free. It's nearly impossible for an investor to determine whether the current lease agreement is fair.
I agree TA is kind of a lottery ticket-big potential upside. But they are stuck with very high fixed costs, and are uber-cyclical and economically sensitive. There's a major risk the stock eventually goes to zero.
Microsoft: Defenestrated By A New Paradigm [View article]
Green Mountain: Starbucks Deal Hides Poor Report [View article]
StoneMor's Misleading Press Release: The Short Case Continued [View article]
StoneMor's Misleading Press Release: The Short Case Continued [View article]
STON's track record of acquiring new properties while issuing shares has on net been highly dilutive. Revenue per share dropped from $17.10 in 2007 to $11.77 in 2011, a 32% decline. And this was accompanied by dramatically lower margins and cash flow conversion.
If you want to talk about return of capital, here's a number for you: 40 cents. That's the amount, per share, in cemetery property that the co converts to cash each year. It's about what the company is capable of paying out in distributions without inevitably collapsing.
The Impending Implosion Of StoneMor Partners [View article]
An Analysis of 4 Chinese Advertising Businesses [View article]
Very much looking forward to the pending CCME news....
China MediaExpress: The Most Undervalued Stock Poised to Profit From China's Emerging Middle Class [View article]
"CME believes its status as the sole strategic alliance partner designated by an entity affiliated with the Ministry of Transport and the exclusive rights to display advertisements on the system has facilitated its historical expansion and is expected to continue to provide them with a competitive advantage in the future...The cooperation agreement also gave CME exclusive rights to display advertisements on the system."
Apple Rocketed Past Microsoft in Revenue This Past Quarter [View article]
T-Mobile's Bad Side: Too Much Debt And Too Little Equity For PCS [View article]
StoneMor Partners: For Income-Seekers With A Death Wish [View article]
This Telecom Giant Is Expensive [View article]