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Michael Nau

 
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  • Where The Money Fleeing Apple Went [View article]
    "definitely".
    Mar 20 05:36 PM | Likes Like |Link to Comment
  • Where The Money Fleeing Apple Went [View article]
    I guess only time will tell. I plan on checking back in May or June to see how the companies in this article have changed in price. It will definately be interesting to watch.
    Mar 20 03:56 PM | Likes Like |Link to Comment
  • Why Protective Life Is A Buy [View article]
    I was looking at a quotation from morningstar that matured in 2066, but there's a lot of information is missing on the quote page and I'm not sure that morningstar is the best place to go to get preferred stock quotes.

    The markets for preferreds, convertables, and bonds are less transparent to a retail investor like me, so I'm not sure if I can offer any help. I'd advise being careful, though, given the big information asymmeties between the big boys and the little guys in these markets. You may be better off with a preferred CEF or mutual fund where you can leave the execution to profesionals.
    Mar 20 02:42 PM | Likes Like |Link to Comment
  • Where The Money Fleeing Apple Went [View article]
    New Low, thanks for the comment, definately food for thought. While I think that volume measured in shares is important, so is volume measured in dollars. AAPL's volume has gone up with its market cap in the long run. If AAPL did a 10:1 split, share volume would go up, but would that have changed how AAPL's fall influenced the prices of other companies in the industry?
    Mar 20 02:35 PM | Likes Like |Link to Comment
  • Where The Money Fleeing Apple Went [View article]
    Kurtis, you make a good point, and your thinking reminds me the SA debate about whether "money on the sidelines" can affect stock prices. For every buyer theres a seller and so on.

    Here's my response: its all about leverage. Everyone was levered to the gills in AAPL and then started getting margin calls. I suspect that there is much less leverage supporting AAPL's price than 6 months ago. Investors that wanted to use leverage turned to something else, and a few turned to these three small, unloved, out-of-favor tech stocks. Options activity has picked up for these names.

    Unfortunately, there is no public information that I am aware of that could test this hypothesis empirically, so I have to settle for correlation rather than causation. A partial test would be whether these names are negatively correlated with AAPL in the near future.
    Mar 20 11:45 AM | Likes Like |Link to Comment
  • Where The Money Fleeing Apple Went [View article]
    tachy46, you're right about NOK's recent fall, but that's the whole point: as soon as AAPL looked like it was stabilizing, people started selling NOK. I think these developments are connected.

    K. Herbert, you are right about the rules for mutual fund companies, which I specifically name in my article. However, hedge funds don't necessarily follow those rules and AAPL was widely sold by hedge funds since its top. Given NOK's daily volume, it would not take a whole lot of new buyers to juice the price.
    Mar 20 11:35 AM | Likes Like |Link to Comment
  • Where The Money Fleeing Apple Went [View article]
    Thanks for the response. I agree that some of the money likely went to GOOG. I didn't include it in the article because it is a much bigger company and it would take more to move the needle, so I felt a little less confident about asserting the connection. GOOG also seems less speculative to me at this point because the business is being valued on current profitability and not just future prospects.
    Mar 20 11:32 AM | Likes Like |Link to Comment
  • Netflix Valuation: A 'House Of Cards'? [View article]
    NFLX is in bizarro valuation fantasyland. Once investors stop being so scared of AAPL, it and BBRY will come crashing down. Supply and demand.
    Mar 19 10:45 PM | Likes Like |Link to Comment
  • These Catalysts Will Drive AIG Shares Higher In 2013 [View article]
    I totally agree. AIG is the only SIFI that is trying to have a comprehensible business model. In a few years, the financial crisis stuff will blow over and it will just be a dominant insurance company. Buy now while its 50% off.

    Long AIG
    Mar 19 10:25 PM | 1 Like Like |Link to Comment
  • How Obamacare Could Harm Growth In 2014, Part III [View article]
    What about health care cost growth? It has finally slowed. That's one of the big reasons that most employees haven't gotten a raise in disposable income terms in 20 years. Obamacare is not necessarily responsible, there is the slow recovery, patent expirations, etc. But it may play a role. Have an open mind and be open to the evidence, this is an experiment in progress. Don't just consult your political philosophy for the answer.

    I say scrap the whole employer-based health care system. It came out of an historical accident of wartime price controls and tax loopholes, not a conscious decision. My employer doesn't select my apartment or groceries. There's a reason why newly rich countries like Taiwan or South Korea do not copy our system.
    Mar 19 09:20 PM | 5 Likes Like |Link to Comment
  • Why Protective Life Is A Buy [View article]
    robertc39, where did you get your quote from? I'm looking at Morningstar and the highest YTM preferred I see is 7.22 for the issue that matures in 2066.

    I'm not an expert on preferred, its a strange creature that I don't know how to value properly. Here's what I'd say: the company seems like a pretty safe credit risk to me, but read the fine print about whether it is callable or has any other catches.
    Mar 19 09:02 PM | Likes Like |Link to Comment
  • Capital Southwest Corporation: $1.00 For $0.61 [View article]
    Thanks for another solid article. I'm also a bit worried about the transparency issue with the unlisted companies. Why wouldn't they just disclose operating metrics? Presumably they have them for internal consumption. Not letting owners know what they own sounds suspicious to me. Are they hiding something? Or just don't feel obligated to explain themselves to investors? I don't like it.

    Also, to expand on the closed-end fund fund point, many closed end funds trade at a discount for a reason: high unrealized capital gains that will eventually have to be paid by shareholders, high fees on an extra layer of management, lack of faith in management, etc. I don't know about CSWC myself, but these may be factors at play here.

    You may have found a bargain here, but I think this company should trade below book at a non-transparency discount, as should most other private equity arrangements. I've looked at companies like these and the BDCs before, but as an outside investor it is too much of a black box for my taste.
    Mar 19 08:23 PM | Likes Like |Link to Comment
  • Salesforce.com - Sometimes Hype Just Isn't Enough [View article]
    Good point Ed. This is why SA is so important for our capital markets. The old system of a analysts a small group of "cool kids" who "get it" has all to often done ordinary investors a disservice. Truly free societies need to have space for vigorous dissent.
    Mar 19 06:48 PM | 2 Likes Like |Link to Comment
  • Salesforce.com - Sometimes Hype Just Isn't Enough [View article]
    sdt, interesting point. So lets say that I'm a short, I think that those stock options may not be a cost at all because they will expire out of the money. You are onto something here, but does the company release info about strike prices or other details? A lot of companies have moved the goal posts for options in the past by backdating etc. I'd say that is CRM isn't transparent about this, then assume from a valuation perspective that management has the whole thing rigged.
    Mar 19 06:44 PM | 1 Like Like |Link to Comment
  • The 'Too Big To Jail' Red Herring: The Jamie Dimon Edition [View article]
    This is a good point. The government can have its cake and eat it too: it gets to look tough because senators are yelling at important people, but doesn't have to enforce the law. Congress is not a law enforcement agency, so it can't arrest people. It can embarass them though.

    I might consider committing fraud if the only penalty was getting yelled at by a senator.
    Mar 19 01:59 PM | 1 Like Like |Link to Comment
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