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  • If Amazon Is So Overvalued Why Does Google Want To Be Like It? [View article]
    My comment assumes that anyone investing, individually their own money in stocks, understands the concept of a stop loss order. With companies like Amazon, Salesforce, Netflix, etc...the pure disdain for the valuation seems to take away the discipline needed to have a stop loss order. If you believe as whole heartedly as many here do that Amazon is overvalued, then it is entirely possible they do not have a predefined point at which they would cut their losses.
    Mar 17, 2013. 01:55 PM | Likes Like |Link to Comment
  • Panera's Dirty Little Secrets [View article]
    "The general sentiment of Panera patrons is that they're getting fresh-made food that's healthy for them"

    Any research to back that statement up? The company is certainly not saying to "eat here because we offer a heart healthy menu and other companies do not".

    Maybe more importantly Panera Bread, though not offering healthy food by your definition, still is a better alternative than the other top 15 fast food restaurants that consumer's dine at.

    So given the option between Panera and the other 15 top fast food restaurants in the survey linked to below it is pretty clear Panera is your best bet. Considering you want some inkling of portion control or healthier foods to choose from and are eating at a fast food or fast casual restaurant..
    Mar 17, 2013. 01:10 PM | 1 Like Like |Link to Comment
  • If Amazon Is So Overvalued Why Does Google Want To Be Like It? [View article]
    No question I wish I would have seen that bubble. Your analogy however misses one critical point. The most I could lose on buying a house is 100% of my investment. There is no limit to what you could lose shorting Amazon or any stock.

    Regardless buying on that tip top of the housing bubble cost me maybe 25% of my investment. Going short Amazon at around $180 or so where it was the about a year ago would be a 50% loss for those investors.

    Frankly the only bubble I see right now is the Fed and until someone can pop that you could probably invest in acorns appreciating in value and somehow make a ton of money.
    Mar 17, 2013. 09:35 AM | Likes Like |Link to Comment
  • Samsung Galaxy S4: A Gift To Apple Shareholders [View article]
    Under what analysis or set of statistics are you saying "now iPhone can't top itself"?
    Mar 17, 2013. 08:59 AM | 1 Like Like |Link to Comment
  • If Amazon Is So Overvalued Why Does Google Want To Be Like It? [View article]
    I am saying don't short Amazon based on a price to earnings multiple using current or future earnings.

    For those who are shorting Amazon I am asking, if they believe the company is overvalued enough to short the stock, why does Google want to enter the same types of business Amazon is engaged in.

    I am using the Google analogy to make two points. Either the shorts are correct and Amazon is overvalued. If that turns out to be the case Google will shortly proceed to be overvalued as well.
    The counter point is that Google see's the same opportunity to generate revenue growth that Amazon see's and ultimately feels they need to compete with them.

    I lean towards the second point being more likely to be correct which helps support Amazon's valuation and will also negatively impact the operating income ratio for Google.

    I disagree with your comment on lack of analysis. I believe I am using both qualitative and quantitative analysis throughout. For example I am taking the 2020 revenue estimate from someone who is extremely bearish on Amazon at it's valuation today. I believe this contributor understands the company and it's business prospects. I just don't agree their method of valuing the company. With that in mind, and his $165B revenue estimate for 2020, I am saying I do not think a 13% CAGR over the next 8 years is going to be hard to achieve. This is made more so by the fact the company is growing at around a 25% annual clip right now. Growth is expected to be above 20% for the at least the next two years per the consensus of 32 analysts who cover the company. It would take a meaningful slow down from 2015 to 2020 to not obtain a 13% CAGR. if Amazon reaches the consensus revenue in 2014, of $92.5B, put forth by those same 32 analysts noted above their growth will only have to average 10% for the next 6 years. Walmart sales grew about 6% this year as a reference point.

    Lastly, the main argument I made in previous comment's was that I believe Amazon will exit the heavy investment stage they are currently in at some point in the future. I don't know what year and quite frankly I don't care because they are not going to be investing unless it is for growth. At that point when they do stop investing I believe they can have a FCF yield of 6% of revenue which they achieved prior to starting this multiple year period of infrastructure build out. 6% of $165B in revenue is roughly $10B in FCF annually. That would equate to an 8% FCF yield at the market cap Amazon trades at today.

    Qualitatively I am expressing that I think valuing Amazon on their ability to generate significant cash flow in the future is a better way to assess whether the company is overvalued than by making that judgment on GAAP earnings.
    Might be hard to miss all that analysis through 100 comments. Probably should have just turned this comment into an instablog or article but here it all is in one place for you.
    If there is certain analysis you still feel I am lacking I truly would like to know in order to do a better job presenting a contrarian view in the future on Amazon or in other cases.
    Mar 17, 2013. 12:46 AM | 1 Like Like |Link to Comment
  • Samsung Galaxy S4: A Gift To Apple Shareholders [View article]
    Walk into an Apple store and then walk into a Samsung store and your question will be answered (if you can find a Samsung store). Just make sure when you do walk into the Samsung store you do not think you are dreaming that you are really in an Apple store since Samsung blatantly copied their design.

    It can be kind of like the move "Inception". Your key that you are not dreaming will be to count the number of non employees in the room. If it is under 20 it is a Samsung store. Over 100 and it is an Apple store.
    Mar 16, 2013. 11:54 PM | 2 Likes Like |Link to Comment
  • Samsung Galaxy S4: A Gift To Apple Shareholders [View article]
    This is the worst argument in favor of Samsung out of 200+ comments and most of the Samsung cheerleaders would probably agree.

    "AAPL's core competency is creating new markets where none previously existed"

    Sure I can agree with this point to an extent. But you have to give credit where credit is due, that refining existing products such as the iPhone is just as critical as developing the next breakthrough product. If each new generation of iPhone sells more the all previous generations combined Apple is just decent at least in the realm of refining their own products wouldn't you say?

    (above claim supported by Phil Schiller under oath in the Samsung trial and supported by an analysis linked to below)

    "True innovators are hard to come by, and in technology, innovation is everything. AAPL needs NEW products, not refinements of current products. Without new products, Samsung will eat AAPL alive because Samsung's core competency is making an existing product better."

    I do not even know what the heck you are trying to say here. You claim in technology innovation is everything. Then go on to claim that Samsung will put a hurting on Apple because Samsung is best at making an existing product better.

    So you are establishing that in your opinion Apple was great at innovation but no longer will be. Samsung is great at refining existing products. But your key point is again "innovation is everything". You are saying Samsung does no innovating and assuming that Apple will no longer be able to innovate which is why Samsung is the better of the two. Good argument.

    Even if you are correct and Apple never releases another iPhone or iPad type product, then as your argument stands, we are left with two companies that can not innovate and the winner will the be who is best at making an existing product better.

    Think I will put my money on Apple if that is the case with their track record so far with all of their innovations. As Samsung will only be able to make their existing products better they better pray there really is no innovative juice left in Cupertino.
    Mar 16, 2013. 11:46 PM | Likes Like |Link to Comment
  • If Amazon Is So Overvalued Why Does Google Want To Be Like It? [View article]
    Your first sentence perfectly describes a program like this that already exists. It is called FBA (Fulfilled by Amazon) and is a program that Amazon perfected awhile ago.
    Mar 16, 2013. 11:12 PM | Likes Like |Link to Comment
  • Samsung Galaxy S4: A Gift To Apple Shareholders [View article]
    Thanks for the reply. A couple of things I would point out -

    - If Apple simply maintained their current level of sales (across all products and not just iPhone) they could generate $20B a year in cash for perpetuity assuming the same financial performance seen in 2012. Some will argue pricing will drive margins down. Others will argue that manufacturing efficiencies will offset any top line pressure and gross margin will stay the same. The point is that Apple has an inherent interest of protecting their base of users at the same time they are expanding the addressable market with more products. With just the current base of users, cash on the balance sheet, and cash flow generating power Apple is an undervalued company.

    - The US is actually less saturated with smartphone users than other developed countries ( so there is plenty of growth from new users in the states. Demographic changes will certainly entail that older folks who never adopted a smartphone will be replaced by those who grow up as babies playing on their parents.

    - If you want to see the ultimate relevance of smart phone users switching companies look no further than Blackberry or Nokia. The undisputed smartphone leaders in units shipped in 2009 when sales were under 200M units a year. Both were slow to innovate and by 2012 when smart phone sales had more than tripled to over 650M units a year these two companies were left for dead by many. So yes I do think it is highly important to focus on your users not switching to other platforms as Blackberry and Nokia have shown you they can and will.
    Mar 16, 2013. 03:57 PM | Likes Like |Link to Comment
  • Samsung Galaxy S4: A Gift To Apple Shareholders [View article]
    I don't understand your the real point of your question but no I am not a copywriter and nor do I have a background in clinical science.

    "stolen both the pizzas from the Apple iPhone in addition to users"

    I assume you take issue with that statement which is grounded in facts?

    When a survey of smart phone users shows intent to purchase an iPhone drop from 70% to 50% in 90 days and Samsung rising from 13% to 21% in the same time period it is hard to argue with my statement.
    Mar 16, 2013. 02:34 PM | Likes Like |Link to Comment
  • Samsung Galaxy S4: A Gift To Apple Shareholders [View article]
    Thanks for quoting me where I say "in my opinion" and then telling me if I am going to have the audacity to make such a statement I should use "in my opinion". I guess the placement of those 3 words makes the entire article a moot point:)
    Mar 16, 2013. 02:27 PM | Likes Like |Link to Comment
  • Samsung Galaxy S4: A Gift To Apple Shareholders [View article]
    That is some funny material. Good work.
    Mar 16, 2013. 02:24 PM | Likes Like |Link to Comment
  • Samsung Galaxy S4: A Gift To Apple Shareholders [View article]
    I am sure Nokia is thrilled with the success of the Lumia. Probably much more so than Apple is with the iPhone.

    When 50% of survey respondents intend to purchase an iPhone 5 and less than 7% intend to buy a Windows OS phone it is hard to even include Nokia in a conversation. Even if you go off the other survey linked below showing that 70% of Windows sales are Nokia products you are still talking about only 5% of potential smart phone purchasers being interested in Nokia products. This compares again to more than 50% for the iPhone 5.

    Maybe the strangers you mention all work for Nokia?
    Mar 16, 2013. 02:21 PM | 1 Like Like |Link to Comment
  • If Amazon Is So Overvalued Why Does Google Want To Be Like It? [View article]
    When Walmart was less than 20 years old do was anyone shouting from the mountaintops that it would turn into a company doing $500B a year in revenue?

    So yes I am arguing that today, it is very hard for an investor to say with impunity that Amazon should be shorted, and that it has a fair value of $60 per share based on typical valuation metrics. You simply do not know how large its addressable market will become. Paulo said earlier he is shorting the company on the assumption that Amazon is doing $165B a year in revenue by 2020 or a CAGR of about 13% over the next 8 years. I would not mind owning Amazon today because I think their FCF as a % of revenue will grow materially in the future and support the valuation today.

    Remember I don't own shares and am not advocating buying shares in Amazon. I think the entire market will sell-off and take Amazon down with it. I would look to buy and hold Amazon as a long term investment when Bernanke stops goosing the market and we have the real correction and capitulation that never occurred.

    Paulo I am sure you have probably mentioned this somewhere but what is your target on Amazon, out of curiosity, and are you a short until Amazon hits that target?
    Mar 16, 2013. 02:07 PM | 1 Like Like |Link to Comment
  • If Amazon Is So Overvalued Why Does Google Want To Be Like It? [View article]
    How does that make any sense at all? If the company is growing revenue at 20% or more per year, they are increasing the amount of goods flowing through the fulfillment centers each and every year.

    It would make perfect sense that if the company is investing wisely and top line growth continues to happen (which you yourself don't dispute will happen) that it is entirely possible and actually probably that it takes more than 1 year for a fulfillment center to operate at maximum capacity.
    Mar 16, 2013. 01:30 PM | Likes Like |Link to Comment