Joe Gradzki

Research analyst, value, arbitrage
Joe Gradzki
Research analyst, value, arbitrage
Contributor since: 2013
Thanks for the link.
I'm concerned about the valuation allowance. Seems like future profitability may be in question. I also thought it was odd that they wrote down most of their campus assets but didn't appear to sell anything. Maybe they are sitting on future gains for another quarter?
I'm not certain the valuation holds up when adjusted for off balance sheet operating leases. What are your thoughts?
No problem Tom. I made sure to put a link to you're article concerning the restatement. It looks like you were on to these guys early. Nice work.
Good write up,
Anyone have thoughts on the recent buyback at 70?
Also, what type of discount would one give for lack of control.
Lastly, can someone explain the significance of the MLP draw-downs now. It seems like wlkp owns a pretty small share of OPCo... Is the IRS ruling really a big deal for wlk, especially if there are 10 years to unwind? How does that all play out?
Also, why where they buying so much stock this past quarter at 70?
Nice article. Can you comment on their decision to stop reporting starts. What is your expectation of starts going forward?
Thanks, joe
What's your view on polyethylene prices and when do you think producers with ethane feedstocks will regain their advantage?
Also, any thoughts on the IRS issue with wlkp?
The management stopped reporting starts. How does one project anything now that BPI is a black box? Also, what's your opinion on the last years massive buyback of BPI stock and options at a price above market?
Thanks -joe
BTW... your site is hacked Netwall
Nice article Syed. I have been doing research on SAFM and have some questions you might be able to help me with.
1. What happens to the broiler BREEDERS after they are finished laying eggs. Do they fatten them like to the broilers and add them to the count?? I understand the they are much leaner and may even be fed a different feed regiment. Where do they go after their egg laying days are over?
2. SAFM breaks out their COGS in their 10-K as "Feed in Broilers Processed" and "All Other COGS". Do you take the former to include the feed used for broiler breeders as well??
3. Management mentioned on the recent GS investor day call that Tyson and PPC don't currently have an appetite for capacity expansion. They also added something to the effect of..."That might change". It's hard to see Tyson adding capacity now, but can you see PPC doing it?
4. The shorts seem to be worried about supply increases outstripping the current demand. SAFM management noted that industry processing capacity is really the limiting factor and is probably down about 3% from 2007, even with SAFM's 2011 Kinston plant. Is the short thesis missing the industry's current processing capacity constraint??
5. Finally... How do you feel about maximum bonuses in a quarter where breeders got too fat, and broilers didn't get fat enough??
Thanks for the time and good work.... Joe G.
If I remember correctly, BPI bought back all of management's OTM ESOs for $19.50 during the tender. Looks to me like management and Warburg Pincus both bailed themselves out in a quarter that showed losses, all at the expense of the shareholders who didn't sell. (BPI's earnings loss that quarter would have been still larger if the tender wasn't made near the end of the quarter and weighted average share count was more greatly affected). For years they welcome the grant chasers because they made the enrollment metrics look high, but then when these scammers don't pay their AR, they fire their top accounting exec and restate their bad debt.... and then they stop reporting starts and pretend not to understand the distinction between persistence and retention... just count the number of times these guys restated since their IPO.
How can you analyze this company after they've stopped breaking out starts?
You said...
"BPI had 61,117 students enrolled at the end of Q2, which was a 5% decline from the end of Q1. This reflects the increase in the quality bar that BPI is now enforcing..."
Are you sure about this? BPI enrollment numbers have tracked the general decline of the industry. I don't see how it's possible to make that judgement, especially without start data. I think there may even be a chance that BPI is back to its old ways.
What are your graduation and dropout estimates for the year?
The answer....
$100 par @ 8%
10 year = $62.20
30 year = $49.00
It's clear you missed my point. I know what duration MEANS. The question is what risks are inherent in a long dated, low coupon bond??? The answer is A LOT.
You said "Most bonds will not as they are fixed rate." You're right. So what happens when interest rates rise??? Bond price fall... (The longer the bond and the lower the coupon, the harder they fall in an environment of rising rates) THAT'S DURATION, and duration of treasuries have never been higher.
So I'll ask the question again a bit differently.....
How much is a 10 year 2.5% treasury note worth if interest rates rise to say 8%???
How much is a 30 year 3.5% coupon bond worth if interest rates rise to 8%???
Where's Kevin Porter when you need him??
AC, nice work on this story.
Maybe their definition of "material" is different than mine???
May 22 - 8-K....
The Company disclosed in its Form 12b-25 Notification of Late Filing, filed on May 16, 2014, that its Form 10-Q for the period ended March 31, 2014 cannot be finalized until the completion of the audit committee’s review of allegations contained in reports issued by Gravity Research and the completion of the audit of the Company’s financial statements for the period ended March 31, 2014.
June 11 - Merger Agreement – ARTICLE 4 Representations and Warranties of the Company...
(i) Since September 25, 2013, neither the Company nor any of its Subsidiaries nor, to the knowledge of the Company, any director, officer, employee, auditor, accountant or representative of the Company or any Subsidiary, has received or otherwise been made aware of any material complaint, allegation, assertion or claim, whether written or oral, regarding the accounting or auditing procedures, methodologies or methods of the Company or any of its Subsidiaries or their respective internal accounting controls, including any material complaint, allegation, assertion or claim that the Company or any of its Subsidiaries has engaged in questionable accounting or auditing practices.
…Since September 25, 2013, there have been no internal investigations regarding accounting or revenue recognition discussed with, reviewed by or initiated at the direction of the chief executive officer, chief financial officer, general counsel, the board of directors or any committee thereof of the Company or any of its Subsidiaries.
May 22 - 8-K....
On May 20, 2014, Montage Technology Group Limited (the “Company”) received a letter (the “Letter”) from the NASDAQ Stock Market LLC (“NASDAQ”) indicating that NASDAQ has determined that the Company’s failure to file its Form 10-Q for the period ended March 31, 2014 with the Securities and Exchange Commission serves as an additional basis to delist the ordinary shares of the Company pursuant to NASDAQ Listing Rule 5250(c)(1).
June 11 - Merger Agreement – ARTICLE 4 Representations and Warranties of the Company...
(g) Since September 25, 2013, the Company has complied in all material respects with the applicable listing and corporate governance rules and regulations of NASDAQ.
(k) Since September 25, 2013, the Company has been and is in compliance in all material respects with the applicable rules and regulations of the 1933 Act, the 1934 Act and NASDAQ.
"The Merger Agreement contains certain termination rights for the Company and Parent. Upon termination of the Merger Agreement under specified circumstances, including with respect to the Company’s entry into an agreement with respect to a Superior Proposal outside of the “go shop” periods, the Company will be required to pay Parent a termination fee of $40,770,000, but if the Company terminates the Merger Agreement to enter into a Superior Proposal during a “go shop” period, the Company must only pay to Parent a termination fee of $20,385,000. The Merger Agreement also provides that Parent will be required to pay the Company a reverse termination fee of $67,940,000 under specified circumstances set forth in the Merger Agreement, including if Parent fails to obtain any of the Parent Required Approvals or PRC antitrust clearance other than as specified in the Merger Agreement."
What's the duration of a 30-yr on-the-run treasury yielding 3.5-ish %?
How does one retain their purchasing power when the economy and inflation picks up??
WT wrote a SA article this afternoon too...
BTW.... 8-K is yet to be posted.
The SEC would look at this as a win-win for the US shareholders. Equity holders get paid, and one more chi-scam company disappears. I'm not sure that they care much about the put holders of MONT... nobody sees those losses.
It's tough to handicap this with so little knowledge of PDSTI's intent... ShihRyanJ is probably right. It may be more prudent to sit this one out until the offer is pulled... fraud or not.
Someone just wired Tong Ye 544,500 shares for this article.
He should have pumped harder today.... lol
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A short, short story
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