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  • EOG Resources Has Nearly 60% Upside Potential [View article]
    Why is there any reason to believe a drop to $65 in WTI in 2013 after going through European armageddon, WTI only got as low as $80. Also, the market trades at 14x 2013 PE, and EOG has much better earnings growth potential, so I'm not sure why 20x is so unattractive.
    Aug 11 12:46 PM | Likes Like |Link to Comment
  • Ford Europe Stinks - But That's OK [View article]
    A buyback would be nice, but I really do not see it happening. Especially with the dividend being reintroduced so recently.
    Aug 9 06:29 PM | Likes Like |Link to Comment
  • Ford Europe Stinks - But That's OK [View article]
    Well, certainty in the US and Europe would definitely be a positive.
    Aug 9 05:39 PM | Likes Like |Link to Comment
  • Ford Europe Stinks - But That's OK [View article]
    True. Right now F and GM are both tethered to cyclical trends. Hopefully they improve operationally, so can can temper moves in the macro economy.
    Aug 9 02:38 PM | Likes Like |Link to Comment
  • Ford Europe Stinks - But That's OK [View article]
    Thanks for reading TwistTie. It's always hard to stay in a stock when you've lost money in it.

    Before we wrote this article, we had hoped to have a higher price target for the stock. We thought Europe might have a sharp increase in car sales after they sorted through their current mess -- kind of like what happened in the US. But management seemed so pessimistic about the future of the car industry in Europe, we had to reflect that in our model. That's probably what is driving other people's targets down as well. Being long Ford, I hope us target-setters are wrong and management is being overly pessimistic.
    Aug 9 12:53 PM | Likes Like |Link to Comment
  • Rackspace Hosting: Q2 Growth Not Fast Enough For Valuation [View article]
    Yes I do. I also owned Terremark and Savvis and Navisite when they all got bought for a 30% premium. The company is valued on EBITDA because the hyper-growth the company is experiencing is causing D&A to be high and EPS low versus a "normal" state.
    Aug 8 12:42 PM | Likes Like |Link to Comment
  • Amazon Has Yet To Show The Benefits Of Scale - Will It Ever Happen? [View article]
    What is your thesis and justification for $270? Since you look at the whole picture, I'd love to hear it.
    Aug 8 12:34 PM | 1 Like Like |Link to Comment
  • Salesforce.com Grossly Overvalued [View article]
    you need to back out capex from operating cash flow. that makes a big difference.
    Aug 8 12:30 PM | Likes Like |Link to Comment
  • Salesforce.com Grossly Overvalued [View article]
    It will take about 10 years for that industry to approach a commodity. And then RAX will still differentiate on customer service, which I think is one of the most over-looked competitive advantages in the stock market b/c few analysts and portfolio managers have ever run a business.
    Aug 8 12:29 PM | Likes Like |Link to Comment
  • Rackspace Hosting: Q2 Growth Not Fast Enough For Valuation [View article]
    One reason that Rackspace trades at such a premium valuation is the high probability of a take-out some day. This is a premier asset in the managed hosting / cloud industry, so it deserves a rich multiple. We have a $72 PT for 2013.
    Aug 8 12:03 PM | 1 Like Like |Link to Comment
  • Earnings Preview: Rackspace Hosting [View article]
    Has anyone heard about the response to OpenStack by customers - existing or potential? Would love to know how it's being received in the market place.
    Aug 7 10:28 AM | Likes Like |Link to Comment
  • Salesforce.com Grossly Overvalued [View article]
    Great point, and well articulated.
    Aug 7 10:24 AM | Likes Like |Link to Comment
  • Salesforce.com Grossly Overvalued [View article]
    Good Morning Fair & Balanced,

    I like the name! From your work, does Salesforce pay competitive cash salaries, or do they rely on huge stock options to attract talent? That would be really cool to know.

    Thanks!

    Aug 7 10:23 AM | Likes Like |Link to Comment
  • Amazon Has Yet To Show The Benefits Of Scale - Will It Ever Happen? [View article]
    Hello mnomis,

    Great quote. It's certainly one of the things we worry about with the short. You have nailed it -- there needs to be a catalyst that make investors reassess the valuation. We actually thought last quarter should have been it given the top-line and bottom-line miss for the quarter AND revenue guidance below expectations. I guess we'll be waiting a little bit, but the next catalyst for downside re-valuation will be 3Q.

    What the bulls are so excited about is 1) revenue growth, 2) the size of the market opportunity, and 3) expectations that margins will expand dramatically as the business matures. We think revenue growth will slow as more and more state taxes are forced to be collected by Amazon (big impact in 2014) and the business model is not able to scale up like the bulls anticipate.

    There does seem to be a gravity defying pull to the stock which is likely several hedge fund algorithms chasing it until it breaks (like Chipotle in it's near straight-line run from $320 to $440.) But when the algos break and momentum players leave, it's HUGE downside. We're trying to stay patient until that happens.
    Aug 7 10:19 AM | Likes Like |Link to Comment
  • Amazon Has Yet To Show The Benefits Of Scale - Will It Ever Happen? [View article]
    Hi riccaro1,

    Thank you for the detailed explanation, that was helpful. I totally agree with you that sticking to a game plan (in your case needing confirmation) is the best way to invest. Discipline is so key in these crazy markets. We are also very disciplined with our fundamental work and valuation assessment -- we lie in the weeds like an alligator an pounce on opportunities when they arise.

    If the biggest downside to your quotient process is a missing some upside and sideways stocks, that's pretty good.

    -IM
    Aug 7 10:07 AM | Likes Like |Link to Comment
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