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  • Fairway: An Update From Analyst Day [View article]
    Blue,

    Not sure 2.3 vs 2.9 is much of a squeeze when down from $30. I think the analyst day would have produced this stock price result without me. I do note that short interest has held steady so probably a fair amount of complacency amongst the bears.
    Nov 20, 2014. 02:03 AM | Likes Like |Link to Comment
  • Walter: Revisiting The Bull Case - The Price Is Lower, But The Upside Remains The Same [View article]
    You are retiring par debt that needs to be satisfied before common has any value at 30 cents on the dollar. If the Comapny recovers, you would still need to issue $10 shares stock to have the same effect at par. I would rather no dilution, but this is not a bad deal and there will still be lots of upside on the stock and $300 less debt in my scenario. I view this as modest insurance in some of the stumble along scenarios where met only goes to 130-140. It will also making refying the senior debt easier.
    Nov 19, 2014. 12:35 PM | Likes Like |Link to Comment
  • Walter: Revisiting The Bull Case - The Price Is Lower, But The Upside Remains The Same [View article]
    Blue and Char,

    This is most likely arbs who bought the notes in the high 20s and effectively sold them in the low 30s, no mystery there. It is not that bad a deal for WLT. If you could retire and additional $300mm of debt and 30 cents on the dollar and only issue about 30mm shares that seems like a good deal. If the notes were redeemed at par, it implies a $10 stock issuance price which is not bad. They should do more of these deals and maybe even some for the 2nd liens in the mid 40s. I wouldn't do any of the high dollar price notes.
    Nov 19, 2014. 12:11 PM | Likes Like |Link to Comment
  • The J.C. Penney Turnaround Sputters [View article]
    I would have to go back and read the articles but I think you were calling for a reorg by now in some of your articles, the exact opposite has occurred.
    Nov 18, 2014. 09:58 AM | Likes Like |Link to Comment
  • The J.C. Penney Turnaround Sputters [View article]
    EA,

    I will eventually write an update, but the bottom line is that the JCP turnaround is much faster than anything you wrote about and right now the stock is down because sales have not come back as fast as the bulls (including me) thought. GM and SGA are very good and can still improve and the debt has been refied. Any pick up in sales from here should move the stock.
    Nov 14, 2014. 11:00 AM | 2 Likes Like |Link to Comment
  • Walter: Revisiting The Bull Case - The Price Is Lower, But The Upside Remains The Same [View article]
    Charbon.

    WLT mgmt. obviously badly misjudged the met pricing fall and will probbaly be the last to see an increase. At $110 met coal was what the realized so there is a huge drop in EBITDA (roughly $80mm per $10 in change) from $120 that I modeled. I would have predicted more like $10mm for the quarter but there are other variables that affect it. The stock at $2 obviously prices in a lot of that risk. At current liquidity levels and $110 met coal, the company will have more like 1.5-2 years unless pricing improves. I would remind you that pricing can and does change very rapidly.
    Oct 30, 2014. 01:53 PM | Likes Like |Link to Comment
  • Walter: Revisiting The Bull Case - The Price Is Lower, But The Upside Remains The Same [View article]
    EPS Update,

    Nothing really ne other than one would think Ch. 11 was about to happen based on stock and bond prices and it was just more of the same. Met coal is down and the Company is managing through by cutting SGA, Capx and doing some debt equity swaps. Liquidity is still good and give them 2-3 years of room depending on prices. I guess I would expect some firming of the stock and bonds as the news was generally better than expected with not real surprises.
    Oct 30, 2014. 10:57 AM | Likes Like |Link to Comment
  • Walter: Revisiting The Bull Case - The Price Is Lower, But The Upside Remains The Same [View article]
    they would do it via swaps not tenders and prob. couldn't get that much done. That said at current debt and equity levels some swaps make sense though not a solution.
    Oct 29, 2014. 03:54 PM | Likes Like |Link to Comment
  • Walter: Revisiting The Bull Case - The Price Is Lower, But The Upside Remains The Same [View article]
    Blue,

    Depends how you define dilution. With unsecured debt in high 20s and low 30s, issuing 60mm shares at $2 to retire $400mm of debt at 30 cents is not that crazy. Dilutive, sure, but a massive deleveraging.

    The real issue is that doing that at $120met coal does not solve their issues so the Company is almost better off waiting for prices to improve, In cases where met slowly goes back to $150+ those swaps could make a difference.
    Oct 27, 2014. 12:19 PM | Likes Like |Link to Comment
  • Walter: Revisiting The Bull Case - The Price Is Lower, But The Upside Remains The Same [View article]
    Update,

    It is interesting to note that WLT just declared its normal .01 cash dividend. While not a lot of money in the scheme of Walter's expenses, it does highlight that they are still working for equity and in compliance with covenants (though the financings have largely made covenants moot in the near term).
    Oct 23, 2014. 02:29 PM | Likes Like |Link to Comment
  • J.C. Penney: The News From Analyst Day Appears Good On Balance [View article]
    Ply,

    Still long. Better risk reward here as solvency issues solved.
    Oct 17, 2014. 01:24 PM | 1 Like Like |Link to Comment
  • Fairway Board Compensation: A Response To The Bloomberg Story [View article]
    I don't think Trader Joe's service or WFM is better but .. that is what makes markets. FWM food and selection is better. IMHO
    Oct 13, 2014. 01:47 PM | Likes Like |Link to Comment
  • Walter: Revisiting The Bull Case - The Price Is Lower, But The Upside Remains The Same [View article]
    Charbon,

    The news is more pile on, but it is obviously not good. Not sure that necessarily changes the 2-3 year forward look, but it is not good near term news.
    Oct 9, 2014. 12:56 PM | Likes Like |Link to Comment
  • J.C. Penney: The News From Analyst Day Appears Good On Balance [View article]
    EA and Others,

    The point that I am trying to make is that with these gm and sga assumptions, I believe that EBITDA will vastly exceed $1.2 billion unless sales are barley above $13 billion
    Oct 9, 2014. 12:53 PM | Likes Like |Link to Comment
  • Walter: Revisiting The Bull Case - The Price Is Lower, But The Upside Remains The Same [View article]
    Charbon,

    Interesting that MS burn is 282 (much closer to my number than EA). He is starting with a much lower cash balance as well, but his model actually implies almost 2 years of burn.

    That said, not sure why he as any value other than as a contra indicator.
    Oct 8, 2014. 01:28 PM | Likes Like |Link to Comment
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