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Manjunath Sharma, CFA

 
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  • Dispelling Some Of The Myths Surrounding Gilead Sciences [View article]
    Thanks for informative article. Next year EPS estimate range is from $7.65 to $12.15 with median at $9.92. With 10% cost of capital it is worth $99.2 assuming annuity for this growing bio-tech. Bought some more at around $101. First profit taking price target (based on my valuation) is $126 and anything over that is bonus.
    Nov 18, 2014. 03:39 PM | Likes Like |Link to Comment
  • Salix Pharmaceuticals: What Scares Me Most About Its High Inventory & Stock Collapse [View article]
    Thanks for detailed inventory analysis. EPS Estimates are too high. Some analysts reduced the estimates already (but some are still bullish), see Barron's article. Look to short soon at around $100 and buy a call for protection.
    Nov 11, 2014. 01:45 PM | 1 Like Like |Link to Comment
  • GoPro To $30 Within 12 Months - The Comps Wall Street Isn't Talking About [View article]
    GPRO is trading at a high valuation indeed. Current valuation, based on Yahoo Finance estimates, using 10% discount rate is $77 (of which $8 is from Forward earnings, $11 from next five years and $58 from beyond 5 years). I would not pay such a high price for a stock given that long-term value is low. As usual analysts are giving it a high growth rate and think abnormal profits that last forever. Nothing lasts forever. This stock will crash to $30 or below once the high growth rate fades and competition kicks in. But now may not be the right time to short. But timing is the most difficult part to get shorting strategy right. It could be late next year or in 2016. Meanwhile in short-run, stock could go beyond $100.
    Nov 5, 2014. 12:45 PM | 1 Like Like |Link to Comment
  • Recent Carnage In The E&P Sector Makes Oasis Petroleum A Great Buy [View article]
    OAS gave me heartburn, sold it at $39 and took a loss. Revenue is determined by commodity price, costs are determined by operations. If commodity revenue falls faster, operations cannot adjust (mainly fixed) quicker. PE ratios hardly matter. Sell first (OAS sell) and ask questions later. OAS, SN, BCEI PXD. Still falling.
    Nov 5, 2014. 10:24 AM | Likes Like |Link to Comment
  • Why Michael Kors Is Worth Considering Now [View article]
    My Longer-term calculated value is $86 with 15% growth rate. Out of this $41 is from forward earnings, $10 is from next 5 yrs and $35 from beyond that. 10% discount rate. I will buy this stock if it touches or comes close to $55 or lower. Margin of Safety is important to me. Value and price at which equity trades are two different things as most of us know.
    Nov 4, 2014. 05:40 PM | Likes Like |Link to Comment
  • Why Michael Kors Is Worth Considering Now [View article]
    Question: If your price target remains the same even with poor future guidance, then the cash flow from future periods is not discounted properly to reflect valuation in your model. Is it not?

    Barron's is negative on KORS. I agree with Barron's. To justify $120 price target (I modeled using my spreadsheet), KORS needs to have a 19% growth rate forever. 2015 $4.78, 2016 $5.47 and then EPS growing at 19% forever. I used discount rate of 10%. It is not possible to have such a high growth rate in an industry with so much competition.
    Nov 4, 2014. 03:38 PM | 2 Likes Like |Link to Comment
  • Bed Bath & Beyond: Gains To Come Beyond 2014 [View article]
    Thanks for great info. I can flip the argument and say that BBBY has debt, generating EPS growth with buy backs and declining margins. Long term valuation is $66 using generous EPS estimates and 12% growth rate. Shorted once and covered. Will short again around $66.50
    Sep 30, 2014. 11:48 AM | Likes Like |Link to Comment
  • Bed Bath & Beyond: Nothing To Celebrate About [View article]
    Thanks for info regarding debt situation. My valuation (based on EPS and LT growth of 12%) is $66 for this retailer. This particular quarter there is a issue with payables, as they seem to have stretched paying vendors. Inventory seems to be ok. Shorted at $67 with a Oct 17 $67.5 call for protection that I bought for $0.95. IMHO, shares could just stagnate and go nowhere.
    Sep 25, 2014. 03:38 PM | Likes Like |Link to Comment
  • Potbelly: Sell-Off Is Warranted On Lack Of Growth And Earnings [View article]
    From Yahoo Finance consensus analyst long-term growth rate is 24% that is obviously invalid. Valuation is $19.4 (out of which only $6 is for next 5 yrs). If we cut the long-term growth rate to 12%, valuation is $6.54 ($3 short term, $2 next 5 yrs and $1 long-term). I would not even think about this stock until price drops to $5 or less.
    Jul 10, 2014. 05:25 PM | 1 Like Like |Link to Comment
  • Why Is Ambarella In My Retirement Portfolio [View article]
    Valuation of AMBA and Price at which AMBA is trading are two different things. This is a highly volatile stock that has no place in my retirement portfolio. IMHO, AMBA touched $22 a few months ago and was a good buy at that level, perhaps not at these price levels ($31 or so).
    Jul 8, 2014. 12:14 PM | 1 Like Like |Link to Comment
  • The Fresh Market Remains An Excellent Short [View article]
    Valuation according to my model: if I set the growth rate to 10% (same of cost of capital), equity is worth $18.33 per share. I will have to do more work and understand your SSS and growth rates and how you arrived at your valuation. To me $12 appears way too low.

    Question: Terminal value is $740 / $1051 ~ 70%. So 70% of value that you calculate is after 10 yrs correct?
    DCF may not be the right way to value this company. I agree partially with the previous comment (19384011).
    Jul 3, 2014. 01:51 PM | Likes Like |Link to Comment
  • Boeing: A Solid Second Half Play [View article]
    Excellent margin of safety if I can buy BA at $118 or below.
    Jun 30, 2014. 04:02 PM | 1 Like Like |Link to Comment
  • Coach Is Falling - Is It A 'Buy' Now, Or A 'Sell'? [View article]
    "Here is the Inventory Turnover rate for Coach and some comparables (including Michael Kors):"

    Did I miss it or you missed it? I see chart with debt/assets, but not inventory turns.
    Jun 25, 2014. 03:36 PM | 3 Likes Like |Link to Comment
  • GNC: The Wrong Kind Of Arbitrage [View article]
    Thanks for a good informative write-up. I see a short term value of $31, next 5 yrs value of $7 and another $17 for future (giving a total of $54). Even if we forget $17 of future value (with 12% growth rate and cost of capital of 10%), value is around $38. I will pass, unless I can buy this stock at $31 or below that gives a good margin of safety.
    Jun 23, 2014. 07:02 PM | Likes Like |Link to Comment
  • This Is When The Bear Growls [View article]
    Did not see any objective assessment of S&P earnings, or PE ratios or market cost of capital. Range of S&P undervaluation, fair valuation or overvaluation is not addressed either. As one comment says "correlation is not causation"
    Jun 20, 2014. 05:12 PM | 5 Likes Like |Link to Comment
COMMENTS STATS
55 Comments
34 Likes