Jae Jun

Portfolio Update: Holdings, Performance

Old Trader,

Thanks. I love stocks that have a beta of greater than 2. It means if the market moves up 1, I'll be up 2.
If the market is down 1, I'll loading up more when its down to -2. :)

I have found volatility to be a great tool.

Portfolio Update: Holdings and Performance

@Tim Stabosz
Total agreement with you on radio stocks. Just unbelievable how cheap it is at current levels. Even going beyond EPS, most radio stocks are already cash flow and FCF positive. Sure they are debt but they are making more cash than what their interest payments are.

@Brian McMorris
I use covestor to track my performance and the graph is dynamic but I only converted it over in oct or nov 2008 so it's still too early to come to conclusions.

2009 Fortune 40 Best Stocks for Retirement: Part III

If you go through just these 10 companies, half of them already offer dividends.

Please go through the previous articles to understand the whole picture.

Calculating Maintenance Cap Ex: J&J, Wal-Mart, Atwood Oceanics

@ Ravi,

Thanks for the inflation point. I forgot to mention that.


On Jun 24 09:43 AM Ravi Nagarajan wrote:

> The issue of inflation is very important to consider. Depreciation
> charges are based on the historical cost of capital expenditures
> while new cap ex are paid at current costs. In a period of high
> inflation, it may appear that a company is investing in growth because
> cap ex is far higher than depreciation when in fact they are merely
> replacing the assets that have become obsolete but were purchased
> at much lower historical costs.
>
> This factor is probably not a huge issue over the past decade (although
> in aggregate, even a 3% inflation rate is significant) but could
> be far more of a problem going forward.

Calculating Maintenance Cap Ex: J&J, Wal-Mart, Atwood Oceanics

You've hit the dilemma of trying to figure out capex. The best way for me, although not always the right way, is to take multiple time frame averages. Not just in blocks but in various blocks between various timeframes and then take the median.

This will smooth things out as well as give a fair idea of what the capex has been. It also allows me to see the "rate" of growth in the maintenance capex which I would have to accept.


On Jun 24 09:13 AM eddybaby wrote:

> Nice post.
> It's good to get to grips with this issue, but how do you view the
> view that maintenance capex does just that; maintains. And if we
> want to project forward (say via DCF) to get an intrinsic value for
> the businesses free cash flows, we need to take full account of the
> likely capex spend to drive that growth.
>
> The area that really stumps me is the discontinuity caused by substantial
> acquisitions! any thoughts on how to tackle evaluation of these?
>
>
> Best wishes

Deep Sea Oil Drillers Show Potential for Gains

I agree that this sector has been unduly punished.

Long ATW.