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  • Intrinsic Valuation Of The S&P 500 [View article]
    DCF assumptions aside, back out the artificial growth from this Keynesian hallucination of QE and valuations become quite different. Admittedly, zero interest rates have made it an enjoyable ride. Low vol taken for granite as the imbalance in expectations among market participants has grew to an all time high. A 4th round of QE, possible. But not ideal. Rates will rise, eventually. But how can the policy mistake of '37 be avoided? Difficult one. More difficult, that is in a time with disruptive technology and structural inefficiencies in market execution the average individual is not prepared for.
    Aug 30, 2015. 12:49 PM | Likes Like |Link to Comment
  • 5 Reasons Energy XXI Remains A Strong Buy [View article]
    Sold high teens last year. No reason to hold. Risk/reward profile no longer attractive -- opportunity cost of buying provides no value add. If you have to be in energy, stick with the big guys. Exxon. Chevron.
    Aug 30, 2015. 12:24 PM | Likes Like |Link to Comment
  • Bank Of America - How A Greek Fix Fast Tracks The Stock To $18 [View article]
    I agreed. Geopolitical risks have limited the amount of funds us money managers are allocating abroad. Not investing in Europe right now is a mistake. The euro will continue to weaken, but there are plenty of wages to hedge this
    Feb 15, 2015. 01:16 PM | 1 Like Like |Link to Comment
  • Bank Of America - How A Greek Fix Fast Tracks The Stock To $18 [View article]
    A rate rise will occur -- Q2 if you ask me. However, do you really think asset prices will sustain under a hike of 50bps? Think again. There's only a couple ways for this Keynesian hallucination to play out and QE4 is one among several other measures bound to occur in the next decade. Our currency is gaining serious momentum for the first time in a while. The govt would not do anything to offset this. The Euro will hit parity as they follow our footsteps just as the rest of the so called "developed countries" fall into the trap we have set. Yellen is a puppet. She's not calling the shots. Please be serious.
    Feb 14, 2015. 09:44 AM | Likes Like |Link to Comment
  • What U.S. Investors Can Expect From ECB QE [View article]
    Capitalize on a weaker Euro. Taking profits on EUO. Hoping to enter a EUR/USD put spread if it backs back up soon.
    Jan 25, 2015. 08:23 PM | 1 Like Like |Link to Comment
  • General Motors: Buy This 2015 Play Now [View article]
    Ford over GM when it comes to valuation right now. GM has more in store over the next two years, and despite Ford is can you justify buying in with this level of downward momentum? Large, successful shorts have made Ford's shares cheap, but the rebound upwards will be far more difficult this time around. The increased level of vulnerability shown in the last few weeks is a clear example of how rather small headwinds will keep too much uncertainty on traders plates. When uncertainty hits -- sellers are not far behind. Ford technicals have never made it a great stock too trade. It's an unfortunate reality for this true American company, but there's just some stocks now meant for traders. I would watch this one. The selling does not appear to be over.
    Oct 26, 2014. 10:54 AM | Likes Like |Link to Comment
  • GLD ETF Has 8%-17% Downside Unless Trouble Spreads [View article]
    Inverse leveraged ETFs on Oil & the Euro have been excellent trades recently. Not sure I can say the same for Gold, but fade the bounce and see what happens.
    Oct 5, 2014. 03:10 PM | 1 Like Like |Link to Comment
  • There Are A Lot Of Positives For Chesapeake Energy, Including A Major Technical Support [View article]
    Bought it back in early 2013, and have added a couple of times a long the way. I want to continue adding, but CHK continues to break short-term support lines. That is a strong base you pointed out, however there's an ever stronger one hovering within the $16-18 range. What's are take on its current 50 and 200-day moving averages as of market close on Friday?
    Sep 28, 2014. 04:41 PM | 1 Like Like |Link to Comment
  • W&T Offshore: Picking Among The Rubble [View article]
    I've followed EXXI & WTI for a while. EXXI has further downside -- short positions among hedge funds have destroyed the stock. Moreover, management will need to provide further clarity on the current state of its operations and reiterate how it plans to add value with the EPL acquisition that had shareholders up in arms about. Not time to buy EXXI yet. WTI is a different story, and a better run company in my opinion. Yes, the dividend yield is nice, but there's no guarantee uneven cash flows QoQ will make it become obsolete down the road. Would like to see a higher FCF yield and improvements in WTI's technicals before I can be comfortable taking a position. Keep in mind offshore oil & gas companies, specifcally are still popular short targets among hedge funds.
    Sep 27, 2014. 11:57 AM | Likes Like |Link to Comment
  • Hercules Offshore: September Fleet Status Report [View article]
    Excellent time to cover short positions.
    Sep 22, 2014. 11:17 PM | Likes Like |Link to Comment
  • Target to keep stores open later [View news story]
    Exactly. It's a high opportunity cost for Target and shareholders'. I would like to see management quantify the marginal cost per every extra hour the store stays open and the operating costs associated with staying open later. I would have a hard time believing that particular regions with stores see enough late night business to make this worth wild, especially with the alternatives consumers have to choose from nowadays. I could see additional store hours for Targets located in college towns providing a positive economic benefit, but it's difficult to justify all stores across the board.
    Aug 17, 2014. 03:27 PM | Likes Like |Link to Comment
  • Target to keep stores open later [View news story]
    Target's a great company, but only for its ability to penetrate a wide variety of different target markets (focusing on age groups across the various departments they have). Otherwise, management has a history of mediocre capital budgeting, which has clearly translated into lower profits in periods when other retailers were flourishing. A firm can have the best products in the world, but if it lacks internal controls over the major financing arms of a company, the firm will either run into capital adequacy issued, or in Target's case, the inefficient use of capital. When cash is not put to work, it's simply wasted. It deteriorates the potential value added that could be added to the firm, and shareholders' are merely dragged along for the ride.

    Among other things, I'm perplexed as to why management choose to increase store hours. From a cost standpoint, its ineffective and is an action that should be taken down the road after the firms near-term expansions plans are finalized and investors been to see an adequate ROIC from the specific projects. On top of that, Target's financing costs are fairly high (Target's Current WACC = 9.2%). With a ROIC (3.55%) that's lower than its WACC, the economic value added (EVA) is not there. The EVA spread is negative {(ROIC-WACC),(3.55%-9.2%) at -5.65%, and the probability of it seeing further declines continues to go up.

    It will be interesting when 2014 year end retail sales are released at the beginning of next year.
    Aug 17, 2014. 03:18 PM | 1 Like Like |Link to Comment
  • I Have No Fear Of A Market Crash Or A Significant Correction, Here's Why: Part 1 [View article]
    Equity markets have rallied from about 3%-8% over the last month, but stocks are still still relatively strong. A potential interim correction is likely, but there has not been any changes to the structural bull market profile as monthly momentum models remain positive.

    If the Dow Jones and S&P 500 continue to rise higher, the weekly momentum buy signal that has been in effect for the last couple of weeks would need to continue increasing enough to eliminate a negative divergence to new price highs.

    Among major indexes, the S&P continues to have the strongest support and a more distinguishable buy signal than the Dow, which goes to show why the S&P has been outperforming the Dow in recent weeks (mainly due to the fact the Dow reflects a price-weighted average). Investors should continue to look at the S&P and other indexes moving forward given some of the Dow's components are peaking at multi-year highs (Visa, IBM, etc.), which will likely influence the near-term direction of the Dow.

    The Russell 2000 and NASDAQ composite are lagging in terms of strength compared to the S&P. Particularly, the Russell 2000 has yet to break through the March 2014 high. The Russell's momentum suggests the current buy signal in effect is extremely weak, and far below the prior momentum level we saw leading up until March 2014.
    Jul 6, 2014. 12:35 PM | Likes Like |Link to Comment
  • This Portfolio Has 50% Upside And Will Outperform The Markets Again In 2014-2015 [View article]
    Great returns, but horrible risk/reward profile here. The marginal unit of risk you take on to generate these returns is extremely high, and the reward potential does not even begin to compensate you for the risk (assuming your not hedging w/ mid-duration option contracts). It's great to see you pulled out the returns you did, but w/ this portfolio's sharp ratio, a level of kurtosis that's peaked well above any normalized distribution, this portfolio could take one nasty swing if market conditions experience the slightest change.
    Jun 28, 2014. 01:31 PM | 1 Like Like |Link to Comment
  • Shale Oil Stocks - Time To Reassess [View article]
    EOG - great company with exceptional performance in recent months, but there's too many institutions sitting on large unrealized gains. Particularly, hedge funds and several select institutions have the capability to drive its valuation down when they choose to take profits/reallocate capital elsewhere. Not a serious threat at the moment, but something for investors w/ a shorter horizon to consider going into the latter part of 2014.
    Apr 27, 2014. 12:17 PM | 1 Like Like |Link to Comment