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Joseph Poma

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  • McDonald's: Fundamentally Overpriced [View article]
    Be as skeptical as you want. It is skepticism that breeds good worth ethic. And as for myself, I'm not trying to impress you or anyone else and so I frankly don't care about your opinion if it doesn't pertain to the subject of the article.
    Jan 14 11:22 PM | Likes Like |Link to Comment
  • McDonald's: Fundamentally Overpriced [View article]
    While I do believe the markets will recover nicely in the coming months, I don't believe MCD will rise "lockstep" with the market. MCD is a defensive stock, which has funds flow into it during times of hardship like we have just seen. As market confidence builds up, the risk trade will be put back on and there will be cash flows out of MCD and into more growth oriented companies. Also, MCD has a beta of .5, I would hardly call that "lockstep" with the S&P, if you were so bullish on the market, an index fund may be a better alternative.
    Jan 14 03:57 PM | Likes Like |Link to Comment
  • McDonald's: Fundamentally Overpriced [View article]
    Not for nothing, but even if the initial premise of your conditional statement were true, it still would not be a valid statement. Just because someone believes that they are capable of a steady return in excess of society "norms" does not make that person a fraud. If on the other hand I had proposed to prospective clients that I'd manage their money based on the understanding that I would be capable of earning those managed accounts a 15% return, yes, then that would be fraud. As for ignorance, call it what you may, but I have had no troubles making a decent return over the years.
    Jan 14 03:54 PM | Likes Like |Link to Comment
  • McDonald's: Fundamentally Overpriced [View article]
    Very cute response, but as long as I continue managing my portfolio properly, I have no reason to believe that a 15% return can not be duplicated over time. As for calling me a fraud, I'd appreciate a retraction of that statement. I am not defrauding anyone here. That is an inappropriate statement and can be construed as slander.
    Jan 14 02:06 AM | 2 Likes Like |Link to Comment
  • McDonald's: Fundamentally Overpriced [View article]
    Again, it's all a matter of proper diversification. if you invest the bulk in 30% loans, you must anticipate a higher default rate. My own allocation is described an a comment above.
    Jan 14 02:02 AM | Likes Like |Link to Comment
  • McDonald's: Fundamentally Overpriced [View article]
    As I mentioned above, the site requirements have dramatically improved since when they first began and the overall financial visibility of the borrower has improved as well. My own portfolio is concentrated primarily within the A and B tiers. Loans within these tiers offer returns varying as low as 7% and as high as 20%. I monitor all of my loans on a daily basis to observe any inconsistencies with proper payment and those that I feel are at risk of default get auctioned off. While there have been delinquencies, defaults have been kept to a minimum and my monthly income stream has been steady. Currently only 4% of my loans have defaulted, while a majority (~85%) of the funded loans are considered "seasoned", meaning they have made all payments for at least 10 consecutive months. Taking advantage of site promotions has also helped augment returns.
    Jan 14 02:01 AM | Likes Like |Link to Comment
  • McDonald's: Fundamentally Overpriced [View article]
    The requirements and transparency have dramatically increased since when the site first began. That, along with a well diversified loan portfolio, offers great opportunity.
    Jan 14 01:52 AM | Likes Like |Link to Comment
  • McDonald's: Fundamentally Overpriced [View article]
    I'll keep that in mind for next time, I appreciate the comments and feedback!
    Jan 14 01:49 AM | 1 Like Like |Link to Comment
  • McDonald's: Fundamentally Overpriced [View article]
    Your looking at stock ownership as ownership of only the earnings. That isn't the case, you are buying the company and everything it owns which means, even if they aren't liquidating any time soon, you still own a portion of assets. I understand that traditionally non-current assets are not added back in to a DCF, this is merely an alteration I have made and one that has worked well for me in the past.

    As for the 15%, I use a peer - to - peer lending service. I maintain a diversified portfolio and have managed, as I have said, about 15% over the past year. If you are interested check out the site, http://www.prosper.com . I don't work for them, nor do I gain any sort of promotional award, just sharing great investment advice from one professional to another.
    Jan 13 08:35 PM | 1 Like Like |Link to Comment
  • McDonald's: Fundamentally Overpriced [View article]
    You do realize there are other methods to investing...right? I have it documented that over the past year I've earned 15.46% and I anticipate that to continue over the next 3 years (if not greater). As per your statement, it wouldn't be prudent to be fully invested in a single type of investment nor would it be wise to tap out loans and other sources of credit to make an investment. I can't believe I actually had to address that with someone.
    Jan 13 07:38 PM | Likes Like |Link to Comment
  • McDonald's: Fundamentally Overpriced [View article]
    Like I said, the 20% isn't related to MCD, but rather to my own situation. If I know I can earn 15%, then I certainly shouldn't discount anything using a lower rate.
    Jan 13 07:05 PM | Likes Like |Link to Comment
  • McDonald's: Fundamentally Overpriced [View article]
    This comment is meaningless without justification. Just saying.
    Jan 13 07:04 PM | 1 Like Like |Link to Comment
  • McDonald's: Fundamentally Overpriced [View article]
    Also, as mentioned in an earlier comment, I know I can earn 15% outside the equity market, this is why I used this "super conservative" discount rate.
    Jan 13 06:36 PM | Likes Like |Link to Comment
  • McDonald's: Fundamentally Overpriced [View article]
    Stock is ownership of a company, right? So as an owner you are entitled to earnings. You are also owner of any assets whether they be liquid or ill-liquid. So when I buy a portion of MCD, I am not only buying a portion of future earnings, but I am also buying a portion of what the company is currently worth in net assets. This is why I included the shareholder into the equation.
    Jan 13 06:33 PM | Likes Like |Link to Comment
  • McDonald's: Fundamentally Overpriced [View article]
    Super conservative is definitely the right term for my approach. I know standard procedure says to use the companies cost of capital, but the way I see it is that I can earn 15% annually on my non-equity investments. I add an additional 5% on for the risk of being in the market.
    Jan 13 06:16 PM | Likes Like |Link to Comment
COMMENTS STATS
431 Comments
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