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Jay Unni  

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  • Dollar/Yen As A Hedge To Oil Investments [View article]
    Thanks, Nick.
    Nov 23, 2015. 08:20 PM | Likes Like |Link to Comment
  • Buy Into The Turnaround At Gran Tierra Energy [View article]
    At the current moment, shares of GTE are at C$2.99, so .40 shares would be worth C$1.20, while the cash consideration will be at $1.33.
    It seems it would make more sense to take the maximum amount in cash... And if you want, buy the GTE shares with the remaining cash.
    I think it's also possible that GTE sells off immediately after the distribution, so there might be a big opportunity to buy in afterwards.
    Curious for your thoughts on this logic.
    Nov 14, 2015. 06:39 PM | 1 Like Like |Link to Comment
  • 3D Systems: The Recent Quarter Is Irrelevant [View article]
    3D is interesting - I always love checking out the momentum stocks of yesterday when they fall off a cliff. The problem is I just can't get comfortable with the risk of another 50% leg down - writedowns (inventory and goodwill), legal problems, loss of significant materials revenue through underutilization - there are a lot of risks out there. The industry could keep growing through addition of new companies, rather than growth of individual participants.
    The way I see it, the risk/reward isn't there for the shorts anymore, but still isn't looking that great for the longs, so the stock is stuck in this quagmire until it has a viable turnaround plan.
    Nov 7, 2015. 03:11 PM | 1 Like Like |Link to Comment
  • 3D Systems: The Recent Quarter Is Irrelevant [View article]
    Chinese solar rebounded quite nicely in 2013 - JASO more than doubled and Trina Solar more than tripled.
    Nov 7, 2015. 03:05 PM | Likes Like |Link to Comment
  • Should You Be Bottom-Picking Energy Stocks? [View article]
    Regarding oil and gas, do you follow SA Author ValueDigger at all? He's been really good at oil+gas in the past, and he really pounded the table on PetroAmerica (PTAXF). It's a zero-debt, cash-rich E+P with low production costs that's basically refusing to drill until prices come up, so the market has punished it. I got interested and bought a few shares.
    I also have a few oil and gas royalty interest companies. These are interesting because the downside is limited (cash flows can only be positive) but your upside is directly correlated to the oil price. Thus its an investment that ought to survive any downturn, in the worst case being a value trap.
    Oct 15, 2015. 02:15 AM | Likes Like |Link to Comment
  • Why High Short-Term Returns Are Likely For Shareholders Of This Film Producer Net-Net [View article]
    Net nets are usually defined as companies with (Current Assets - Total Liabilities) > Market Cap. The idea is to buy something below liquidation value. It's not related to net-net leasing.
    Oct 14, 2015. 03:50 PM | 2 Likes Like |Link to Comment
  • Bargain Hunting In Thailand  [View instapost]
    I think if one was going to take the statistical approach, you'd weight based on the degree of undervaluation - i.e. the lowest p/ncav highest, then the next lowest, etc. Joel Greenblatt said weighting based on valuation had a little better returns than an equal weighting (of course, his formula is a little different than Carlisle's - Greenblatt includes ROIC, while I think Carlisle insists that a simple enterprise multiple performed better).

    I'll have to read more of Carlisle's writing; I've really wrestled with the idea of statistical investing vs more concentrated qualitative + value investing.

    Anecdotally, I've found the value plays that work a little better usually have good stories attached. Logically, I think a value play has to attract investors to move in price, and a good story attracts investors. Plus, I think a little coverage by a few authors, like you and Chris, can sometimes provide a nice catalyst in itself. But, who knows - could be recall bias, and I don't know of any academic studies that test "story-based" investing.

    Btw, very interesting idea! Now if only I could get a borrow on a Thai stock...
    Sep 15, 2015. 06:04 PM | Likes Like |Link to Comment
  • The Best Things In Life Are Less Than Free [View instapost]
    Very nice find, Chris.
    Sep 10, 2015. 08:49 PM | 1 Like Like |Link to Comment
  • BNCCorp: A Cigar Butt That's Worth The Risk [View article]
    Thank you.
    Dec 27, 2014. 12:18 AM | Likes Like |Link to Comment
  • Momentum Stock Bust Is Self-Reinforcing [View article]
    You make some very good points. A rising rate environment itself, and the paradigm shift from risk assets, is not a foregone conclusion. I consider it a working hypothesis, and it accords with the overall perception of analysts at this time. Whether that perception turns out to be true or false will be proven with time.

    You bring up an interesting point about institutional risk taking. In the larger economy, no, institutions are probably still not taking enough risk. That leads me to the question whether lending has improved enough to warrant an end to QE.

    However I believe this momentum stock boom was partially a side effect of this - in order to stimulate institutional lending, the Federal Reserve actually stimulated the purchase of risky equities by retail investors and large funds. I believe this strength in the equity markets may actually lead to the end of QE before it has really had the chance to stimulate the lending it was intended for.

    I am confused by your last point. It sounds like you are skeptical of the ability of these companies to leverage middle class prosperity?
    Apr 2, 2014. 12:24 AM | Likes Like |Link to Comment
  • Momentum Stock Bust Is Self-Reinforcing [View article]
    Yes, I believe expenses would decrease on the income statement, since stock options are expensed at fair market value.

    However cash flow would decrease if the price is in a downtrend; if the options cannot be exercised, the company would not be able to collect the excess tax benefits associated with stock options, nor the cash flow associated with issuance of the shares at the strike price.

    The bigger concern is that a protracted downturn in momentum stocks can decrease their attractiveness to new employees. Right now, the brightest minds in the tech world want to work for these companies, in no small part because being paid in their stock options can make employees rich. However, in periods of downturn, employee pay effectively gets cut to a fraction of what it was. This can lead to a flight to companies that pay a higher base salary.
    Apr 2, 2014. 12:08 AM | Likes Like |Link to Comment
  • Momentum Stock Bust Is Self-Reinforcing [View article]
    In the short run, the effects of the bust in and Amazon were very similar. Amazon lost 92% of its market cap, from peak to trough, in the Dot-com bust.

    However, companies can recover from such a bust, as Amazon has proved, provided they generate enough cash flow to grow from operations alone.

    There is a very good chance that 3D Systems may resemble Amazon in the scenario you describe; I believe it will emerge from the bust with operations intact. However, a 92% decline in the meantime is disastrous for short-term portfolio results.
    Mar 27, 2014. 07:58 PM | 2 Likes Like |Link to Comment
  • Is Facebook Really Worth $58 Billion, Maybe [View article]

    I actually take the opposite viewpoint on this issue. If a company is trading above its intrinsic value, then it is actually a positive to use stock-based compensation. Why? Rather than spend cash on salaries, they can use overvalued stock to essentially get a discount on their SG&A expenses and R&D expenses.

    Actually, if you dig in to the 10-K, you can see that the majority of their R&D expenses (60%) are covered by issuing shares. This introduces a "reflexive" component - increases in share price can lead to bigger discounts on new product development, thus justifying the high share prices.
    Jun 15, 2013. 07:41 PM | 1 Like Like |Link to Comment
  • Traditional Stock Analysis Will Not Work For Tesla Motors [View article]
    Good point. I simply used the Mid point of the loan range. It's not a perfect assumption, and your spreadsheet is more comprehensive.
    Jun 1, 2013. 04:29 PM | Likes Like |Link to Comment
  • Traditional Stock Analysis Will Not Work For Tesla Motors [View article]
    It is a fascinating phenomenon to simply watch. However, I view my own participation as an essential test to verify/deny my thesis.
    May 27, 2013. 02:33 PM | Likes Like |Link to Comment