Seeking Alpha

Mycroft

 
View as an RSS Feed
View Mycroft's Comments BY TICKER:
Latest  |  Highest rated
  • Cisco Systems Vs. The Competition: Who Comes Out The Winner? [View article]
    This is not one indicator, but I use 6

    This analysis will use the following six free cash flow ratios:

    CapFlow
    FROIC
    Price to Mycroft Free Cash Flow
    Mycroft/Michaelis Growth Rate
    Free Cash Flow Payout Ratio
    Free Cash Flow Reinvestment Rate

    I also am a technical analyst as well and you can see my long term chart on $CSCO by going here:

    http://bit.ly/1kZBPP9
    Jan 22 08:30 PM | 1 Like Like |Link to Comment
  • Cisco Systems Vs. The Competition: Who Comes Out The Winner? [View article]
    $FNSR free cash flow management is not very good and that is why I gave it a lower rating. It only returns 6% FROIC (Free Cash Flow Return on Invested Capital) and 65% of their Cash Flow is used as capital spending, which tells me that management is not good at managing their free cash flow.

    Mycroft
    Jan 22 08:30 PM | 1 Like Like |Link to Comment
  • Cisco Systems Vs. The Competition: Who Comes Out The Winner? [View article]
    This is where I got the list of competitors from:

    http://bit.ly/1eAKZM4

    Mycroft
    Jan 22 01:56 PM | 1 Like Like |Link to Comment
  • IBM: The Owner Earnings Ratio Tells Us It's A Strong Buy [View article]
    Ok put on your seatbelts so we can put this issue to rest once and for all:

    Net Income = 16,604
    D&A = 4,676
    Other Non cash Items =688
    Cap Ex = -4,717
    Changes in Working Capital = -2449

    Therefore (16,604) +(4,676) +(688) -4,717 = 17,251

    Then finally you take that 17,251 and add (not subtract) the changes in working capital = $17,251 + 2,449 = $19,700

    Changes in Working Capital was calculated this way;

    Inc/Dec in receivables = -2230
    Inc.Dec in Inventories = +280
    Inc/Dec in Payables = -224
    Inc/Dec in Current Liabilities = -1008
    Inc/Dec in Other Working Capital =+733

    Changes in Working Capital = -2,449

    Mycroft
    Jan 17 02:33 PM | 1 Like Like |Link to Comment
  • IBM: The Owner Earnings Ratio Tells Us It's A Strong Buy [View article]
    Hi Krish,

    I did subtract the capital expenditures. You are confusing Free Cash Flow with Owner Earnings. Here is my article on IBM that compares the two :http://seekingalpha.co...

    Mycroft
    Jan 17 10:58 AM | Likes Like |Link to Comment
  • Apple iPhone goes on sales at China Mobile [View news story]
    There are currently 145 million smartphones in the USA of which Apple has a 40.7% market share. So Apple has 59.1 million I-phones out there in the USA. The USA has 327 million mobile phones in use. So that 59.1 million = 18% of the total USA market for mobile phones is an I-Phone. China and India alone have 2.13 billion mobile phones in use right now, so if Apple can achieve that same 18% market share we have Apple I-Phones being 383 million phones sold in China and India someday. The world has 6.8 billion phones in use right now and at 18% that would equal 1.224 billion I-phones. To date Apple has sold 89 million I-Phone 5S models which is just 1.3% of all mobile phones sold. I would imagine it would be the desire of every human on the planet to own an I-phone as a status symbol so we have a very long way to go.
    Jan 17 10:29 AM | 2 Likes Like |Link to Comment
  • IBM: The Owner Earnings Ratio Tells Us It's A Strong Buy [View article]
    Maintenance Cap Ex = Depreciation and Amortization

    Mycroft
    Jan 17 09:45 AM | Likes Like |Link to Comment
  • IBM: The Owner Earnings Ratio Tells Us It's A Strong Buy [View article]
    Hi Krish07,

    What you are quoting is Free Cash Flow and not Owner Earnings. With Owner Earnings we need to include :

    Increases/Decreases in the following:

    Receivables
    Inventories
    Pre-Paid Expenses
    Other Current Assets
    Payables
    Other Current Liabilities
    Other Working Capital
    And then factor in other non-cash items like stock based compensation for example.

    Owner Earnings is extremely complex and allows you to see the level of number crunching that Buffett and his gang do before buying a stock.

    Mycroft
    Jan 17 08:38 AM | 1 Like Like |Link to Comment
  • IBM: The Owner Earnings Ratio Tells Us It's A Strong Buy [View article]
    Hi Texmex,

    I remember those days very clearly and bought some IBM then and made a killing with Lou. He is a Genius in my opinion as is Sam.

    Mycroft.
    Jan 16 08:53 PM | 1 Like Like |Link to Comment
  • Microsoft: Waiting For New CEO Decision In Order To Buy [View article]
    Gates owns 358 million shares or $12.5 billion at current levels. So even though he may plan to exit the company in 2018, he still has a very large stake in the company and if he were to make a mistake in choosing the next CEO he could lose a lot of money. Ballmer owns 333 million shares worth $11.3 billion, so with $23.8 billion at stake, I think most readers here would agree that my statement was right on the money.
    Jan 14 09:54 AM | 2 Likes Like |Link to Comment
  • Why The Apple Bears Have Got It Wrong And Here Is The Proof [View article]
    If you go to your wireless carrier you can get top dollar for them. I sold an I-Phone 3 six months ago at AT&T and got $75 for it, which amazed me.

    Mycroft
    Jan 12 11:48 PM | Likes Like |Link to Comment
  • Why The Apple Bears Have Got It Wrong And Here Is The Proof [View article]
    Hi Sunworshipper,

    I prefer to stick with free cash flow and I hedge the fluctuations by only analyzing companies with low CapFlow's (capital spending/cash flow) for a long period of time. If you go back and analyze the old General Motors for example, you would see that they had tremendous cash flow from operations, but had negative free cash flow and thats why they eventually went under. All my success as an investor over the years has come from using free cash flow, so I like to stick with what works for me. But everyone is different.

    Mycroft
    Jan 9 01:18 AM | Likes Like |Link to Comment
  • Why The Apple Bears Have Got It Wrong And Here Is The Proof [View article]
    Hi Craig,

    Free cash flow is superior because it also includes net income + a whole host of other things, while also subtracting capital expenditures or capex. So it allows you to measure a dozen things vs. just earnings for the PE Ratio. The PE Ratio is a 19th century ratio and is antiquated, while FCF Yield is cutting edge. You can click on the picture of my book on the left side of this article and there you will find an introduction that will go into complete detail why free cash flow is so powerful.

    Hope that helps,

    Mycroft
    Jan 8 09:16 PM | Likes Like |Link to Comment
  • Why The Apple Bears Have Got It Wrong And Here Is The Proof [View article]
    Thanks Kato,

    It took me 30 years of work to find the right formula and I am very happy with the results.

    Mycroft
    Jan 8 06:09 PM | 1 Like Like |Link to Comment
  • Why The Apple Bears Have Got It Wrong And Here Is The Proof [View article]
    Apple's management is following Steve Jobs' management strategy of concentrating 100% of their energy on making the best products in the world. If they do that then they feel the stock price will take care of itself. Stock splits are meaningless as you are just cutting an 8 slice pizza into 16 slices. It is still the same pizza. When you think that China Mobile has twice the customers as Verizon and AT&T combined, I would not worry about the future.
    Jan 8 10:37 AM | 7 Likes Like |Link to Comment
COMMENTS STATS
648 Comments
874 Likes