Seeking Alpha
View as an RSS Feed

G. Hudson  

View G. Hudson's Comments BY TICKER:
Latest  |  Highest rated
  • Bill Ackman's Folly With Herbalife: 7 Assumptions That Led Him Astray [View article]
    If anyone is wondering how much worse this can get for the shorts and why they are crying like babies on this board. Look at the chart I put together below and realize -> AS OF 11/30/13 -> the shorts have only covered 15,860,816 of their shorts and they have help drive up HLF's share price $36.74 (112% share price increase since 12/31/12 of $32.94

    AND even though they were trying to battle back with the share price up around $70 -> even though they added 874,954 shorts to their position during the time period 11/15/13 to 11/29/13 -> Herbalife's share closing price still increased -> +0.67 ($69.68 - $69.61)

    I would be scared to death if I hadn't covered my shorts & still had a huge position knowing that the share price increased that much from less than 16 million short coverings and there was still over 21 million shorts out there

    All I have to say to shorts is -> RUN FOREST RUN

    Settlement Date;Short Interest;Avg Daily Share Volume;Days To Cover-> Closing Share Price

    11/29/2013; 21,437,568; 2,372,538; 9.035711-> $69.68
    11/15/2013; 20,562,614; 2,045,323; 10.053480-> $69.01
    10/31/2013; 20,772,104; 2,255,828; 9.208195-> $64.82
    10/15/2013; 20,195,382; 3,069,032; 6.580375-> $63.92
    9/30/2013; 24,481,019; 3,485,424; 7.023828-> $69.77
    9/13/2013; 28,632,598; 3,386,579; 8.454726-> $69.35
    8/30/2013; 28,631,648; 2,111,9371; 3.557056-> $61.01
    8/15/2013; 29,395,970; 3,171,918; 9.267569-> $65.23
    7/31/2013; 30,951,936; 6,415,443; 4.824598-> $65.50
    7/15/2013; 30,212,226; 2,075,789; 14.554575-> $52.30
    6/28/2013; 31,972,379; 2,357,887; 13.559759-> $45.14
    6/14/2013; 30,973,168; 1,813,822; 17.076189-> $48.33
    5/31/2013; 30,996,284; 3,189,612; 9.717885-> $46.67
    5/15/2013; 33,058,561; 2,241,506; 14.748371-> $44.78
    4/30/2013; 33,387,875; 1,842,964; 18.116401-> $39.71
    4/15/2013; 32,739,999; 3,290,011; 9.951334-> $35.73
    3/28/2013; 31,538,297; 1,864,621; 16.914052-> $37.45
    3/15/2013; 32,409,584; 3,544,577; 9.143428-> $38.99
    2/28/2013; 32,426,582; 6,198,420; 5.231427-> $40.29
    2/15/2013; 33,598,320; 9,094,847; 3.694215-> $38.74
    1/31/2013; 34,185,820; 10,198,770; 3.351955-> $36.32
    1/15/2013; 35,829,306; 17,666,463; 2.028097-> $46.19
    12/31/2012; 37,298,384; 18,070,594; 2.064038-> $32.94

    Read more:
    Dec 11, 2013. 11:20 AM | 4 Likes Like |Link to Comment
  • A Case For Buying Both Siga And PharmAthene [View article]
    Response from Jeff Eisman-


    I haven't read it yet. I am grading student papers. The briefs are due today, responses to the briefs are due in about ten days, and I believe that oral meeting with the VC will happen before the end of the month.

    Dec 11, 2013. 08:39 AM | 2 Likes Like |Link to Comment
  • Bill Ackman's Folly With Herbalife: 7 Assumptions That Led Him Astray [View article]
    We live in a country that is all about freedom of speech. If I said that I believed that you were a fraud and a con artist CB, it would be my right to express what I believed. Anyone who has a basic knowledge of legal rights knows that it is extremely difficult for a large corporation to sue an individual AND WIN when the individual is expressing their thoughts about a corporation even when there isn't any basis for those accusations.

    When Barry Minkow, a convicted felon, attacked multiple companies with false accusations, some of those companies actually ended up being countersued by Minkow. He was a crook that knew how to use our legal system to beat the system. Many of those companies, including Herbalife, made payments to settle ongoing legal battles that weren't worth the time & hassle because our legal system can actually be used to protect the rights of criminals. Here is my blog post about that situation-

    Sometimes it's better to fight these type of battles, like with Ackman, outside our court system (which sometimes has skewed rights to protect freedom of speech) even when those accusations are false.
    Dec 10, 2013. 11:29 PM | 4 Likes Like |Link to Comment
  • A Case For Buying Both Siga And PharmAthene [View article]

    Thanks for the great post. It all sounds very logical to me. I agree with you as to the court case but I have been around long enough to see judges like Parsons get by with a lot. I personally had a court case which I was helping my son with that the judge just threw out the signed lease when we exposed the problem with the landlord's lease. I could have appealed and continued to fight but we had already moved to a distant state from where the battle was and it just wasn't worth the hassle. I guess it was a moral victory when the landlord's attorney congratulated my son on presenting a great case.

    I think this stock is being played by the shorts especially even today but I think they are going to be in for a surprise when the dust settles. The shorts have been consistently covering their shares over the last 8 months but still are short almost 41 days of average daily volume-

    Settlement Date;Short Interest;Avg Daily Share Volume; Days To Cover

    11/29/2013 5,673,488 139,019 40.810882
    11/15/2013 5,785,318 173,728 33.301011
    10/31/2013 5,971,174 148,101 40.318256
    10/15/2013 5,970,817 262,248 22.767827
    9/30/2013 6,261,398 226,447 27.650611
    9/13/2013 6,305,074 124,223 50.756092
    8/30/2013 6,389,111 115,776 55.185107
    8/15/2013 6,337,191 256,991 24.659194
    7/31/2013 6,112,682 197,808 30.902097
    7/15/2013 6,308,124 231,685 27.227158
    6/28/2013 6,427,051 304,690 21.093738
    6/14/2013 6,582,598 236,072 27.883857
    5/31/2013 6,997,681 396,116 17.665737
    5/15/2013 7,531,635 165,158 45.602605
    4/30/2013 7,463,182 186,471 40.023285
    4/15/2013 7,599,407 246,786 30.793509
    Dec 10, 2013. 06:33 PM | 1 Like Like |Link to Comment
  • Bill Ackman's Folly With Herbalife: 7 Assumptions That Led Him Astray [View article]

    I agree with your statement-

    "And Mr. Thompson, aside from a great, well researched and thorough seeking alpha article, glad to see that you actually used a picture of yourself, unlike other seeking alpha authors. I wonder why they a re afraid to show their faces????? "

    It has been a long while since I wrote an article about HLF though am still long and as enthusiastic of it as an investment today as I have ever been. That is my real face & here are links to articles that I wrote supporting the long position for HLF-

    You can check out my profile- I stand behind my articles and being long Herbalife!
    Dec 10, 2013. 03:08 PM | 3 Likes Like |Link to Comment
  • Bill Ackman's Folly With Herbalife: 7 Assumptions That Led Him Astray [View article]
    I really enjoyed reading your article- FINALLY a Seeking Alpha article about HLF that isn't just filled with repetition of past postings and drivel-> everyone knows who I am talking about - but don't post it there because those posts will be taken down so others won't be able to find out the truth.

    I knew that Ackman didn't understand the cult like behavior of the sales force of a strong MLM so it really didn't surprise me when Herbalife continued to grow. (see excerpt from your article below)

    "When I first saw Ackman's presentation last year, I thought to myself, "There's no way Herbalife distributors can build with this kind of negative publicity." They surprised me and they surprised Bill Ackman. Ackman's presentation was almost a self-fulfilling prophecy. If the sales force was rendered inert, the stock would have tanked; thus, proving his theory that Herbalife was a volatile pyramid destined to collapse."

    I could have saved Ackman a lot of money if he would have consulted me. Unlike Ackman's staff and those people (who live in a different Universe than MLM participants) he chose to consult with, I have actually been inside a MLM and understand how they work.

    When people attack a strong MLM organization, it actually draws them together -> it's us against the outside World mentality. Here is a link to a Seeking Alpha article I wrote about my experience back in January of this year-

    Also as to how Herbalife's stock share price has reacted to this, I think one of my blog posts all the way back before Ackman (8/29/20120 actually accurately predicted the outcome of this battle
    Dec 10, 2013. 12:36 PM | 8 Likes Like |Link to Comment
  • Herbalife Wins Prestigious Consumer Award for its Products in Ukraine [View article]
    It only hurts when it's true and not just drivel - maybe you can see if you can get Seeking Alpha to take the article down as it doesn't fall in line with your fantasy.
    Dec 10, 2013. 12:17 PM | 1 Like Like |Link to Comment
  • A Case For Buying Both Siga And PharmAthene [View article]
    Thanks, I don't really have any insight into the FDA approval process. The only thing that makes me think that SIGA believes it will be over a year or more out is that most of their "Deferred tax asset" is listed as long term ($31.6 Million). If they expected to receive FDA approval in the next 12 months, all of the "Deferred tax" would be listed in the current section of the balance sheet.
    Dec 10, 2013. 10:58 AM | Likes Like |Link to Comment
  • A Case For Buying Both Siga And PharmAthene [View article]
    Just so everyone understands the impact of SIGA's deferred
    tax assets (excerpt from 10-Q)

    "In that 2013 3rd quarter 10-Q SIGA has broken out expected tax benefits from tax loss carry forwards as "Deferred tax assets". As of September 30, 2013 this future tax benefit is split between the short term ($19.4 million) and the long term ($31.6 million) asset section of the balance sheet for a total future net tax benefit of $51.0 million per this excerpt from note 10. Income Taxes"

    For an asset to be listed as current, it would mean that SIGA anticipates using that asset (current deferred tax of $19.4 million) over the next year to offset tax liability. If we assume SIGA's tax rate would be around 25% then we can calculate SIGA's net profit before taxes over the next 12 months as $77.6million ($19.4 million X (1.0/.25 tax rate)).

    This would result in SIGA reporting $58.2 million ($77.6 million - $19.4 million in used deferred tax benefit) or $1.10 of EPS ($58.2 million/53 million shares of earnings per share) -> Not bad for a stock currently trading at $3.15 per share!!
    Dec 10, 2013. 10:01 AM | 2 Likes Like |Link to Comment
  • A Case For Buying Both Siga And PharmAthene [View article]
    The last information I received was that there would be a hearing around December 18-20 but then it's up to Judge Parsons- I think my fellow Seeking Alpha author, Jeff Eisman, probably has more information about that process than I do. Hopefully he will chime in on this.
    Dec 10, 2013. 09:32 AM | 2 Likes Like |Link to Comment
  • A Case For Buying Both Siga And PharmAthene [View article]
    They don't have to refund the $300 million dollars -> if SIGA gets FDA approval -> SIGA receives $100 million dollars of pure profit -> if they don't get FDA approval -> they are able to replace the units and will be entitled to the $100 million dollars for the 2 million replacement courses.
    Dec 10, 2013. 09:24 AM | 2 Likes Like |Link to Comment
  • How Long Will Icahn Hold Herbalife? [View article]
    Just reported on my TD Ameritrade news feed-> 2:29p
    Bloomberg Reporting a Herbalife Spokesperson Has Said Carl Icahn Has No Present Intention to Sell Shares (Benzinga)
    Dec 5, 2013. 02:41 PM | 5 Likes Like |Link to Comment
  • Does Michael Johnson Routinely Violate SEC Rule 10-b-5? [View article]

    Thanks for your lack of insight. I am hoping HLF share price goes back down so I can sell even more puts and pocket the cash.

    I have made a lot of money investing in HLF this year. HLF investors would have made a lot of money too if they had read my Seeking Alpha articles predicting this outcome-

    and of course there was my blog article which accurately predicted HLF's share price rise back up above $70-

    Keep on writing and holding on to those shorted HLF shares -> $100 HLF share price here we come!!!!!
    Dec 5, 2013. 10:09 AM | 8 Likes Like |Link to Comment
  • Revelations From PharmAthene's Legal Brief: Implications For Investors [View article]

    Net profit is very important BUT when GROSS PROFIT (Gross revenue MINUS the matching Cost of Good Sold) rises dramatically - it doesn't necessarily mean that other costs (administrative, general, overhead, etc.) will actually rise significantly at all.

    For accounting purposes, SIGA has chosen to defer recognition of revenues (AS WELL AS COGS) for shipments all ready shipped as well as paid for-

    9/30/13 Deferred Revenues- $162.1 million

    9/30/13 Deferred Costs - $21.9 million (future COGS)

    9/30/13 Deferred Gross Profits - $140.2 million

    So as of 9/30/13, SIGA has recorded as deferred (162.1 - 21.9) gross profits

    Included in the $162.1 million in deferred revenues reported were $96 million in BARDA payments per this excerpt-

    “As of September 30, 2013, the Company has delivered an aggregate of approximately 725,000 courses of Arestvyr ™ (tecovirimat), also known as ST-246®, to the U.S. Strategic National Stockpile (the “Strategic Stockpile”). As a result, SIGA has met a key requirement of its procurement contract with the Biomedical Advanced Research and Development Authority (“BARDA”) (refer to Note 2) and received payment of
    approximately $96 million in the third quarter of 2013 for the courses of product delivered as of September 30, 2013.”

    Using this information, we can derive that SIGA was paid approximately $132 per course ($96 million divided by 725,000 courses). Using a conservative 80% markup percentage this would indicate an approximate $26 per course direct cost ((1- .80) * $132). If we combine all of this information, we can compute an estimate of gross profits before any bonus award payments from the government for all of the 2 million courses to be shipped to the government over the next twelve months.

    Calculation of next 12 months profit on shipments-
    975,000 remaining courses times ($132 per course minus $26 cost per course) = $103.4 million in gross profit
    300,000 free courses times $26 = $7.8 million cost

    $140.2 million + $103.4 million - $7.8 million cost = $235.8 million in gross profits

    An additional valuable piece of information I learned from Mr. Crane, PharmAthene's attorney, at that hearing is that SIGA could potentially get an additional $100 Million dollars of pure profit if Arestvyr is approved as is by the FDA-

    "An additional $600 per course is reserved dependent upon FDA approval. If FDA approves -- it totals another hundred million, if they have to replace-- they don't have to refund the $300 million, Your Honor. They get the additional $100 million to produce the replacement drug. If they don't have to reproduce or replace the drug, the hundred million is all profit."

    $235.8 million in Gross Profits + potentially as much as an additional $100 million in Gross Profits (per above excerpt) = $335.8 million in Gross Profits TO BE RECOGNIZED BY SIGA & POTENTIALLY PHARMATHEN!!!!
    Dec 5, 2013. 09:31 AM | 2 Likes Like |Link to Comment
  • Revelations From PharmAthene's Legal Brief: Implications For Investors [View article]

    I haven't sold any of my SIGA shares and have actually increased, with options, my ability to profit when the award is finally announced. I believe when you look at the sum of both companies-> their combined stock valuation is actually worth less than the value of just the deferred & future profits of SIGA's current contract with BARDA. Therefore I think everyone, as I have done, should invest in both companies (NOTE: I have added to my PIP holdings though it is still significantly less than my SIGA holdings.)

    I started writing an article to support ownership of both stocks but not real happy with amount of effort for article and how editors turn down articles- I calculate potentially $335.8 million in gross profits to be recognized from the BARDA contract ALONE which when the award happens will some how be divided between PIP & SIGA

    Since each company has approximately 53 million shares outstanding -> that equals $335.8 divided by 53 = $6.34 gross profit to be recognized per share -> right now->

    PIP is trading at $2 & SIGA is trading at $3.29 for a total share price = $5.29

    So if anyone is thinking well that's future gross profit that will be taxed -> both SIGA & PIP have large loss carry forwards that could offset taxable income ESPECIALLY if it were split evenly between PIP & SIGA

    NOTE: SIGA as of 9/30/13 reported $19,420,266 in Current Deferred tax assets and $31,556,712 in Long Term Deferred tax assets

    ALSO NOTE: Because of accounting rules PIP can not record deferred tax assets because future taxable income is much more difficult to determine. However if you look at their 9/30/13 balance sheet, you can see that there is an Accumulated Deficit of $205,902,216 of which a large percentage would be able to be used as a tax loss carry forward to offset any damage award from SIGA

    ANY WAY YOU LOOK AT IT-> Anyone buying both SIGA & PIP shares in combination should make a nice profit whatever Judge Parsons decides in their court case
    Dec 4, 2013. 12:55 PM | 1 Like Like |Link to Comment