Micah Dickson

Long/short equity, value, growth
Micah Dickson
Long/short equity, value, growth
Contributor since: 2012
I would say you can have a sluggish economy or one that falls into recession and every day life seem fine. The US has struggled with economic growth for years, but you would be hard pressed to see it in most places.
Did the local people seem to be worried about the economy?
I think PayPal will continue to grow. If it weren't for PayPal, eBay would be a mediocre investment.
Yeah, WFC and PNC were banks that scored pretty well in each category as I was doing my research.
The official ratings are unavailable but you can break down each part and do your own analysis. This helps you do that by looking at each part of the CAMEL rating
Under Deng the reforms the Chinese government made were good choices. After he stepped down, corruption has creeped in and they are beginning to go back to being a more centrally planned economy. Yes, the Chinese government needs to go back to the reforms of Deng that allowed for freer markets.
First off, the economic GDP numbers out of China are shady at best. Even Chinese officials have admitted that. Also, there are systematic problems. You cannot take on that much leverage and expect your economy to do well in the long run. Chinese SOEs are being given loans they shouldn't be given. That and the massive stimulus package China introduces added A LOT of debt to their balance sheets
I'd have to do some work on ONVO. And all the 3D Printing stocks are a little expensive if you are planning on holding them short term. But if you plan on holding them for the next 10 years, these price levels aren't a problem.
I am looking at the long term "safe" play and the long term "risky" play. But I'm not against SSYS at all. In fact, the optimal recommendation would be to have a position in ALL of them. I say that because the industry is so young that you don't know which one is the home run. I hope that answers your question.
It's tempting to say this is a short idea but I honestly think those long or short are betting. Blackberry 10 could sink or propel this company.
I'm actually more interested to see what you all think of it being a take over target. It would really open up the corporate market for a Microsoft or Samsung.
Be great to hear what the community has to say
Dividend growth because I used the dividend discount model but that means the EPS will need to grow at a similar rate because dividends are paid out of earnings.
Zero Based budgeting would be a huge help. Every year, every agency has to explain why they should keep their current budget and why they waste any money. If they are not effective, they get their annual budget reduced. It will expose all the waste, fraud, and abuse to sunlight and make it a lot easier for the average citizen to understand budget talks.
Well I think you can do it without crashing the markets. While monetary policy needs to reigned in, you can show the markets that you are serious about tax reform and spending cuts. This would give investors confidence and allow Bernanke to begin to unwind the Fed balance sheet. It doesn't have to be a shock to the system.
But the problem is spending. I don't believe the Keynesian argument that you must keep government spending at current levels. Let the private sector keep more of that money and reduce spending.
I'm still torn about the banks. Housing is stabilizing which is a huge plus. But there's still a lot of uncertainty. Dodd-Frank is still so murky. At the same time, BAC is still tempting. I'm just not sure. Great article, clarifies more of the positives
Great article. Our problem is spending. We need competitive tax and regulatory reform and spending cuts. Zero based budgeting would be a huge step in the right direction.
Well that's how any high growth stock is. It's great until it stumbles. 4-5 year time horizon, then you definitely want to reduce your risk.
Ok let's look at the time horizons. I think that is where we are missing each other. Under Armour is growing, no one denies that, but in 2013 Lululemon is poised to grow at a faster rate. I'm not projecting into 2014 and beyond. 2013 is way too uncertain on its own. Lululemon is not being recommended for a Warren Buffet style buy and hold. It is being recommended for growth in 2013. That's all. If we are looking beyond 2013, you're right, Under Armour is better simply due to the fact that standard deviation increases with Lululemon due to its limited history. So it depends on your time horizon.
Haha I don't plan on it. But reading the conference call it looks like they are trying to develop products specifically to appeal to men. Under Armour is just really having trouble with its footwear and Nike looks determined to crush them. Lululemon doesn't have that type of competition yet
Lululemon has great margins, growth, and room for more growth. Under Armour has some trouble with margins and growth in their footwear. Lululemon is great until it stumbles. It's a growth stock so my point is ride the train until it shows signs of weakness. Under Armour is still a great growth company but it's not growing as fast as Lululemon.
For PEG I use forward earnings, so until they disappoint, I think they are a good buy. More risk? Sure. More return? Yep.
Hey you too Seth. I really appreciate your comments and taking the time to read my article.
The suite was actually settled. And while GAP is opening new stores, LULU makes their store openings an event. While there may be a ceiling, I don't think LULU will hit it in 2013. I see those type of ceilings being a factor of 2 things, brand loyalty and margins. If customers start seeing Athletica as a real alternative and LULU starts to lose its faithful, there's a problem. And if margins begin to weaken due to trying to keep prices competitive, there's a problem. I do not see evidence of that yet, but it is something to keep an eye on.
Well I look at the suite Lululemon won over Calvin Klein. This shows that Lululemon will protect the uniqueness of their products. I think Lululemon is just too popular for any real challenger to get to them in the coming year or two.
Hey thanks for the perspective and the comment. I believe expanding in those markets is why they acquired Teavana, but what you brought up will probably be a challenge they'll have to deal with. I guess that's part of the risk that has to be monitored. Thanks!
Well the key is that PayPal is not reliant on eBay anymore. It is being used outside the realm of just ebay customers
I believe they are well positioned due to two things:
1. They have a lot of members on both the consumer and the retail side. It's been a convenient option for start ups and for young people who want something that functions like a bank without all the hassle.
2. Smartphones are everywhere and the concept of using them to make and receive payments is growing as well. PayPal is already an established name with many consumers and retailers. If they expand to be the mobile payment processor of choice for retailers and continue to expand among consumers, it would be hard for a competitor to catch up. At 117 million active members, they already have a strong base to work from
That's what I thought you meant. I would actually disagree that it will keep Dodd-Frank at bay. This administration is quite unpredictable when it comes to regulation except that they want more. But you may very well be right.
Are you saying this would keep the regulations in Dodd-Frank at bay? I'm just trying to understand where you're coming from?
Hey thanks for reading and commenting. There is a lot of truth in what you said but I'm looking at it from the perspective of the growth in consumers using their smartphones to make purchases. If PayPal is innovative and takes advantage of its unique position, it could very well dominate the space. Like I wrote in the article, eBay has to see the synergies it's expecting to take over the mobile payments space.
While I agree that a large competitor such as Visa could step in, it appears to me that large financial institutions are trying to wade through new regulations and seeing how they fit into their business model. This delay can help PayPal gain serious footing in mobile payments.
And online shopping is becoming even more popular along with small start ups that function completely online. PayPal is so easy to use for merchants that it could become the default choice for small companies who do not want to deal with big boys. As these companies grow, PayPal becomes a serious part of their ecosystem. Still, if PayPal can't innovate for these customers, they are dead in the water.
Currently eBay has a PE ratio of a little over 20x forward earnings and a PEG ratio of about 1.45. The reason I focused on PayPal on its own had a lot to do with the fact that we may see PayPal spun off depending on regulation. Also with a market that is volatile, I think a lot of stocks will be a whole lot cheaper soon. Sorry, I should have been more clear with why I approached this article the way I did.
I believe in great companies with great stories. eBay is an example of a company that has something great going for it that investors should consider if they see any weakness in the stock due to forces like the fiscal cliff.
You cannot seriously say that 180,000 protests every day show satisfaction with the course China is on. Their Keynesian economic policy coupled with their authoritarian capitalism is unsustainable.
Hey thanks for reading. And I agree they had to reform. Deng was instrumental in making great changes. My view, however, is that the most recent Chinese leadership is not continuing those reforms. By not allowing their economy more freedom they risk alienating their citizens and creating economic turmoil in the mold of other Asian nations during the turn of the century.
Hey great article. I must however disagree, we cannot ignore the fundamental principle of supply and demand. Yes, the government can print all the money it wants but when there is excess supply in the currency market than the value is going to decrease causing inflation. I personally am very fearful of inflation and we are already seeing it in our grocery bills. The only reason the stats don't bear this out is because the equation to calculate inflation is changed all the time. QE will not have the intended affect it was supposed to have. With so much uncertainty in the economy, investors will not put their money out into the U.S. economy. All it will do is drive capital AWAY from U.S. markets and into places where regulation is more certain and they can get a return on investment.