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Matt Hylland

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  • Physical Gold Vs. Paper Gold: The Ultimate Disconnect [View article]
    Why is it that gold is always "Manipulated down", but never manipulated up?

    When it goes up, goldbugs say they are right, when it goes down they are still right...its just being manipulated.

    Also, how is demand the determinate of value. Millions of people bought Apple stock at $700 a share...does that mean there was value there? Millions of people bought beanie babies for $50 a piece in the 90s...does that mean there was value there?

    Sellers put the premium in places because they know people will pay it in times of high demand. Small investors don't go to the paper market for gold because they can't afford it. They go to some kind of broker who charges them a premium. Why is this such a new concept? Do you think APMEX is going to sell to you for spot price?
    Apr 24, 2013. 10:52 AM | 12 Likes Like |Link to Comment
  • Irrespective of today's strong jobs numbers, Doug Kass is sticking to his bearish thesis that market is headed much lower from here. The problem, Kass says, is that "central bank liquidity blurs the line of demarcation between economic reality and stock market euphoria." The narrative now is whether the Fed is simply "pushing on a string," and Kass thinks many market participants are coming to this 'aha' moment." (Video). [View news story]
    I see it already in a few weeks there will be a headline on CNBC titled:

    Kass: "Why I was wrong about the market falling"

    and he will be bullish again, just in time for another down week, in which he will become bearish again...

    This guy can not actually trade like he talks, he would be broke 10x over.
    Jun 7, 2013. 08:27 PM | 7 Likes Like |Link to Comment
  • Intel: Example Of Perpetual Covered Call For Monthly Income [View article]
    Great on paper, but you describe a perfect situation that just never seems to happen.

    Your numbers reflect INTC never going above 23 all year,
    but you are going to somehow be lucky enough to sell calls at ~23 every month? You are either going to get called away every month (and make no profit by selling those 100 shares at the price you bought them), or the stock will drop, to say $22, where then you will have to decide whether to: 1)sell Calls with a 22$ strike and risk actually losing money by getting them called away at $1 less than you paid, or 2) getting a lot less than $70 a month by continuing to write Calls with a $23 strike.

    On top of that, transaction costs are going to put a big dent into your return because it will not work out as you laid out, your stock will be called away at least several times a year if you are selling ATM calls every month.
    I know I don't have the most friendly options broker, but I would pay $7.50 per sale of a Covered call, $7.50 for buying the put, and $19.50 per time your stock gets called away.

    With my broker you are looking at $200 commissions, and that would be a pretty good scenario.

    I would argue that in a more realistic scenario, this strategy MAYBE nets you $400 dollars/year. At that point, buy and hold, collecting dividends and being able to actually benefit from INTC's stock rising seems like a equally decent (and easier) strategy.

    I am not trying to argue against this strategy so much as just saying if you think it will work out as some easy no risk way of netting $800 you are sadly mistaken.
    Nov 27, 2011. 01:10 PM | 5 Likes Like |Link to Comment
  • Low-Cost Funds Dupe Investors - 2Q13 Edition [View article]
    How are you any different than the underperforming active manager if you are deciding what securities are good quality and which are not? Isn't everyone trying to do that? Do you think fund managers are purposly picking poor stocks?

    The way I see it is: The average active asset manager underperforms, therefore, the average active investor will also underperform for the same reasons.

    Everyone would outperform the market if what they thought were "high quality" stocks outperformed ....but obviously that isn't going to happen. Someone is also bullish on Boulder Brands, and one of you will be right and the other wrong. Just like every other stock prediction out there.
    May 30, 2013. 06:11 PM | 4 Likes Like |Link to Comment
  • The next big bubble: The amount of student loans taken out last year crossed $100B for the first time, and total loans outstanding will exceed $1T for the first time this year. And just like in the last subprime bubble, lenders have been "pushing loans to people who can't afford them." When borrowers are tapped out, and lenders plead ignorance, who will again be forced to pay for the bailout?  [View news story]
    I have been saying for a long time this is another (perfect?) storm brewing. Highest student debt ever in combination high unemployment, declining incomes and rising costs elsewhere.

    As said before me, its amazing how screwed up the system is. Government flooding the education system with money so tuitions are raised because it doesn't really matter what the universities charge, the government will give loans anyway.

    Student loans follow one through bankruptcy, so they can't default.

    How does this finally unravel? I don't have a clue, but I think we find out sooner than we think.
    Oct 20, 2011. 08:33 PM | 4 Likes Like |Link to Comment
  • Verizon, Vodafone reach $130B deal on Verizon Wireless stake: WSJ [View news story]
    As a VOD shareholder, i am very happy to sell that stake for $130 billion.

    This leaves a dirt cheap VOD, in a much, much better financial position with a lot of power to expand into areas that are growing much more than the US.
    My last article shows that the rest of VOD's assets trade at about 1.2x EBITDA and less than 3x free cash flow.

    Now just to find out how to spend/ distribute all the money...
    Sep 1, 2013. 03:14 PM | 3 Likes Like |Link to Comment
  • Dr. Doom Has Gold Going Below $1,000: Why His Thesis Is Spot On [View article]
    Oh man, Dr. Doom is bullish on the stock market now, and bearish on gold.

    This rally has even turned Dr. Doom into a stock bull. The contrarian says you know the top is near now.
    Jun 4, 2013. 06:08 PM | 3 Likes Like |Link to Comment
  • Warren Buffett On Ben Graham's Biggest Mistake [View article]
    Really enjoyed the article and got me thinking. Thank you!
    Sep 13, 2013. 09:24 PM | 2 Likes Like |Link to Comment
  • Vodafone's Future Without Verizon Wireless [View article]
    I talk here about VOD's cash flow without VZW dividends:

    (towards the bottom of the article)

    Last year's dividend cost VOD 4.8 billion pounds, it's free cash flow not including VZW dividend was 5.6 billion.

    The CEO has said multiple times the dividend is covered without any help from VZW, and the numbers seem to back that up.
    Sep 1, 2013. 12:00 AM | 2 Likes Like |Link to Comment
  • Vodafone: Value Without Verizon Wireless? [View article]
    I have seen estimated taxes as little as $5 billion and up to $10 billion. It is a primary concern of VOD management, so I expect them to manage it as best as they can.

    If the deal goes through, it would certainly be worth the time to include the affect of taxes on the numbers above to get a much more accurate value.
    Aug 31, 2013. 06:12 PM | 2 Likes Like |Link to Comment
  • Vodafone: Value Without Verizon Wireless? [View article]
    Was just reading this article from bloomberg:

    They are still saying $130 billion for Verizon Wireless, which is nothing new.

    Then another analyst says AT&T could pay up to $124 billion for what is left of Vodafone based on AT&T paying 6x EBITDA.

    $130 billion + $124 billion = $254 billion or $52.60 a share!
    Aug 30, 2013. 07:44 PM | 2 Likes Like |Link to Comment
  • Vanguard Natural Resources - A Safe Commodity Driven 8% Dividend [View article]
    Why are we focusing on the cash flow from financing here?

    As you say, you invest in this because of dividends. So I would look at it like this:

    The company is going to pay out $2.46 per share in dividends this year, as you say. Roughly 65 million shares outstanding (assuming no more dilution for the rest of this year) means they will pay about $160 million in dividends this year.

    I get the unrealized losses from hedging add back that 35 million loss back into its income from opperations. Now the 11 million loss goes to about 24 million gain. The company made about 24 million from operations the first quarter.

    Multiply by 4 and the company makes about 100 million from operations this year. (This excludes any other expenses, by the way of which they have more than 10 million a this quarter)

    And look at cash flow from operations for confirmation. Again, ignore that 35 million unrealized loss...the company generated about 23 million in cash from operations.

    So the company will generate about 100 million in cash from operations for the year, if this quarter is a sign. This does not cover the 160 million they plan to play out.

    So, as an investor, what are you looking for? A sharp increase in income over the next 3 quarters? Or looking at them to take on more debt to finance the dividend, which is obviously not sustainable.
    May 8, 2013. 03:00 PM | 2 Likes Like |Link to Comment
  • Cummins (CMI) -4.4% after it cutting its full-year revenue outlook for 2012 to be in line with 2011's $18.05B vs. previous guidance for an increase of 10%. Analyst expect $19.84B. The firm also forecasts Q2 revenues of $4.45B vs. $4.64B last year and consensus of $5.07B. More positively, Cummins raises its quarterly dividend to $0.50 a share from $0.40. (PR)  [View news story]
    So they put up the same numbers as last year...heck, lets say 10% lower than last year. We are still looking at:

    17B Rev = $88/share in revenue...P/S of less than 1.
    ~$8.60 EPS = PE of a touch below 10
    $1.2Billion free cash flow
    Not much debt, recovering auto sales.

    I don't know...$130 may have been pricey,but $85?....yeah I'll take a stab there.
    Jul 10, 2012. 03:19 PM | 2 Likes Like |Link to Comment
  • Does P/E Really Matter Anymore? [View article]
    I agree that P/E is not an end all be all for any stock, but when we start ignoring it completely and even see articles like "Enough with High P/E's, They Don't Matter." as you pointed out, warning bells go off in my head.

    However, I think we will see a lot more on this issue before it is over. Facebook will be bid up to 100+ P/E I'm sure, people will say it doesn't matter.....until it does. a la 2000.
    Mar 5, 2012. 02:49 PM | 2 Likes Like |Link to Comment
  • Chipotle: Buy Before It Gets Expensive [View article]
    "Buy CMG, you probably won't be the greater fool"
    May 8, 2014. 11:13 AM | 1 Like Like |Link to Comment