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Lou Gray  

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  • Return Of 'Arrested Development' Demonstrates Netflix's Strength [View article]
    Thanks all for the comments. You may have noticed that Netflix's Chief Content Officer had a long interview at a conference -

    A very relevant bit:
    "So I think there is a great scientific basis for how we license content and what we target and how much we pay, but there is also a -- it's coded in the art of saying, if we had that one, that would drive -- it doesn’t quite beat the model. So one of the things I look for in my licensing executives all the time is someone who can figure out the balance of analytics intuition. So they know when to question the data and say I know what the data says about it. It's wrong and the show is going to explode and it takes us certain kind of executive to do that. So for that reason, a lot of this season, I don’t believe that you can reverse engineer content, right. So I think some things have all the parts and still don’t work, or sometimes they have none of the parts, you know somehow they still work. So I think it's a mix of arts and science in that way."
    May 30, 2013. 05:54 PM | 1 Like Like |Link to Comment
  • Return Of 'Arrested Development' Demonstrates Netflix's Strength [View article]
    DIgitalMediaView, great comment. Thank you. All points well taken but let me say why I see things differently.

    1) Amount and quality of data vs competitors
    - GOOG, if you are referring to Youtube, they mostly have data on different kind of content (very short format) for now.
    - AMZN, knowing whether a customer has bought a DVD set is not the same as knowing whether he has watched 1, 2 or all episodes in a season.

    It would be interesting to discuss further how useful the different kinds of data (netflix vs amazon vs hollywood data) are in this context. It seems to me that hours watched online is the most relevant data. Netflix is ahead on this metric, especially against its most direct competitors, Hulu and HBO.

    In any event, I think that Netflix has an advantage at the moment but I do not claim that it is impossible for others to catch up. However, their head start is a substantial competitive buffer.

    2) Algorithms vs experts
    I said "The main advantage of the recommendation systems (sic) is that on average it works better than guesswork across the many, many investment decisions that Netflix has to make."
    The emphasis here should be on "on average". I agree that algorithms cannot fully (100% accuracy) predict people's preferences. However, recommendation systems need just to be able to beat or augment experts' opinion to be useful and provide an advantage.

    That's why I do not find it productive to discuss individual shows as arguments against or for a content strategy that manages thousands of content products (note the difference with Hollywood studios, which have much fewer investments). Still, I find AD a useful example (case study, if you will) of how content strategy decisions are made.

    May 29, 2013. 08:20 PM | Likes Like |Link to Comment
  • AdCare Tender Offer Looks Improbable [View article]
    Benjamin, thank you. The company seems to have been growing revenue briskly. Is this just because of acquisitions or there is actually a chance earnings could grow to justify the market or the "intended tender offer" valuations?
    May 19, 2013. 01:51 PM | Likes Like |Link to Comment
  • Chesapeake Granite Wash Trust - The Good, Bad, And Ugly News In Q1 Results [View article]
    Daniel, great analysis once again. Plenty of wells still to be drilled but track record here has been very weak. I think the comparison with the plans at the time of IPO is now just painful..
    May 16, 2013. 06:21 PM | 4 Likes Like |Link to Comment
  • Bakken: 'Deep' Revolution Underway - Everything Investors Need To Know [View article]
    Richard, thank you for the article and especially the stocks list at the end. Buy them all to bet on Bakken and diversify company-specific risk. The majors give you very little exposure but are still useful to follow for the results of their drilling in the formation.
    May 14, 2013. 03:25 AM | Likes Like |Link to Comment
  • PepsiCo: Buy The Pop And Chips Instead [View article]
    Yes, we should use a wider peer group. Otherwise, what if KO is mispriced?

    Stock Gamer, I generally don't rely too much on margin comparison across companies. Different margin might reflect different product portfolios or different levels of vertical integration. Besides the margin, PEP and KO have remarkably similar ratios. Thanks for this table.
    May 14, 2013. 03:10 AM | Likes Like |Link to Comment
  • Is Now The Time To Buy Walter Energy? [View article]
    I think coal prices remain the critical factor here, cost-cutting notwithstanding. I would need to be very convinced about coal price increasing before thinking about investing. Good luck.
    May 9, 2013. 04:27 PM | Likes Like |Link to Comment
  • IPO Preview: Quintiles Transnational Holdings [View article]
    Solid company but richly priced hence the small pop.
    May 9, 2013. 04:09 PM | Likes Like |Link to Comment
  • Caesars Entertainment Equity Still Has Essentially No Value: A Capital Structure Arbitrage Trade [View article]
    I have been trying to find a reasonable bullish case for CZR's equity to help me understand what I am missing. I don't understand the valuation but I don't think the problem is with me.
    May 7, 2013. 05:22 PM | Likes Like |Link to Comment
  • Sell The News On Stein Mart [View article]
    Thanks, Vince. I agree - nothing to be excited about in the business and the valuation is hefty. Not much happening beyond the lack of negative revision in the numbers.

    "Six of the twelve states have unemployment rates... " - I think you meant "six of the eight states" but your point is clear.
    May 7, 2013. 05:07 PM | Likes Like |Link to Comment
  • Solazyme Brings Innovative Solutions To Sustainable Food [View article]
    Great article, Kevin.

    The roster of partners is impressive. However, do other companies at similar stage of development of technology/product have similar partnerships? From the point of view of the big company, why not try working with all startups like Solazyme even if the individual probability of success is low?
    Apr 29, 2013. 04:03 PM | 1 Like Like |Link to Comment
  • Methanex Is On A Roll [View article]
    Great comment! Thank you.
    Apr 29, 2013. 03:48 PM | Likes Like |Link to Comment
  • Why Small Cap, Domestic Oil Producer Carrizo Could Yield Huge Gains [View article]
    "The proven value of Carrizo's assets, discounted at a rate of ten percent (PV10) is already $1.6 billion. Contrast that with the current market cap of $950 million."

    Also, don't forget the $968 million debt...
    Apr 28, 2013. 10:56 AM | 2 Likes Like |Link to Comment
  • S&P 500 Q1 Earnings Seem Positive: Is It Enough For More Gains? [View article]
    Thanks, Pendulum. Helps put individual results into perspective.

    Can I download to excel the P/E by company table from somewhere?
    Apr 28, 2013. 10:23 AM | Likes Like |Link to Comment
  • Methanex Is On A Roll [View article]
    Philip, thanks - good argument. Do you know who operates the rest of the methanol capacity in the US?
    Apr 28, 2013. 09:41 AM | 1 Like Like |Link to Comment