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Nat Stewart

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  • An End To Our Relationship With Yahoo, A New Era For Equity Research [View article]
    I am curious if this means Seeking Alpha will be cutting back on the "quick screen" and "retirement dividend" type articles. These in my mind are clearly a different market than the more detailed, thoughtful, independent research type articles. I think u could almost have a "spin off" to split this content onto a new site.

    Regardless, i think this is a big blow for yahoo finance. They are clearly (continuing) their move towards becoming a site that focuses on a lower end readership. I have found it to be useless for some time now.
    Jul 25 01:57 PM | 5 Likes Like |Link to Comment
  • U.S. Lime & Minerals: Long Reserve Life, High Barriers To Entry And Substantial Free Cash Flow [View article]
    two good quarters in a row.
    Jul 24 11:51 AM | Likes Like |Link to Comment
  • Why I'm More Confident Of My Herbalife Short Position Today [View article]
    Being correct is not always the same thing as making money, and nowhere is this more true than short positions. Conviction is fine, however not feeling pain when a short blows up 25% is in my mind is not a wonderful quality.

    With regards to Amway, I suggest you ask your relative how much they ended up spending on self help tapes, seminars, conferences, etc. The economics of the Amway scheme now revolve around what they call "tools". Basically the big wigs use their Amway pyramid to sell expensive self-help products to the struggling distributors, which is where the real profit to the scheme now resides.

    The entire industry that relies on commission only sales is by and large extremely misleading to new recruits, never mind highly misleading lottery commercials (such as the "just imagine" themed ones). In that regard HLF and MLM in general are not unique. Much of the industry is based on capturing the "Natural market" and churning through "opportunity seekers." The friends and family who buy product just to "help out".

    With regards to MLM it is true that these businesses mostly are silly and don't work out for the vast majority, but in the end no one cares. This fact is counterbalanced against the folks who do successfully use the underlying products to lose substantial weight. There is an obesity crisis among low income people in this country, if they all had an HLF shake instead of a bag of potato chips and a big mack for lunch, perhaps that would be progress.

    The group-based, or cult-like atmosphere of an MLM might indeed be an effective social element to the product that makes it more effective. It has been found social networks and peer pressure are effective tools for change such as weight loss.
    Jul 23 10:38 AM | 4 Likes Like |Link to Comment
  • Dividends Don't Matter In Retirement Either [View article]
    A well written article but imo you are assuming a few things that are not true. First, that a companies capital allocation decisions (re-invest vs. buybacks. vs invest in business) are neutral (they are not). Second, the typical retiree could stomach a 100% stock portfolio without making adverse and ill-timed emotional decisions (they can't). Third, that the withdraw of funds via selling shares is neutral over time to returns relative to dividends (it is not, as u have to sell more shares when a stock is down than when it is up. I think your idea has allot of merit for the wealthy (say, 3m+ portfolio), but beyond that there are issues.

    With regards to the capital allocation issue within a company - Dividends could be the best use of capital or the worst use of capital, and it would be entirely dependent on opportunities to re-invest in the business at a good IRR, the share price valuation (the other alternative being buybacks), and the yield on debt that could or could not be paid down. Getting the above right makes a difference.

    Enjoyed the article.
    Jul 17 06:59 PM | 2 Likes Like |Link to Comment
  • SWK Holdings: A Micro Cap With A Solid Plan To Compound Shareholder Equity [View article]
    Worth reading for anyone following the stock.

    "Ladies and Gentlemen:

    On May 16, 2014, we submitted a non-binding offer to SWK Holdings Corporation (“SWK” or the “Company”) to purchase a substantial number of newly issued shares of the Company’s common stock for $1.20 per share. The closing price of the Company’s common stock at that date was $1.06 per share. After receipt of our proposal, a Special Committee of the Board of Directors (the “Special Committee”) was formed which consists of two of the three outside directors. It is our understanding that the third outside director cannot serve because he has a financial interest in and is supporting another proposal that would not include the previously disclosed discounted rights offering. Our May 16th letter was prompted by this other proposal.

    On June 20, 2014, after extensive discussions with the Special Committee, we submitted a letter to the Special Committee updating our offer, in conjunction with the rights offering. This letter included a detailed term sheet which is reproduced as Appendix A hereto (the “Proposed Transaction”). This proposal represents a premium to the recent trading price of the Company’s common stock and provides immediate value for existing stockholders. The concurrent rights offering will enable existing stockholders to invest additional equity capital at a discount. Finally, stockholders will retain the post-closing upside in a substantially larger company, with the benefit of minority protections designed to align the interests of all stockholders.

    The June 20th letter was prompted by our frustration with the Special Committee’s overwhelming focus on creating protections from perceived liability for its members as individuals at the expense of the Company’s stockholders. Since then, the Special Committee has unfortunately not changed its behavior. On June 21, they issued a press release which included an accusation that Carlson was attempting to disenfranchise stockholders. However, because the terms of the Proposed Transaction clearly state that we support granting all non-Carlson stockholders the opportunity to vote on the Proposed Transaction, we find this accusation disingenuous. The Special Committee’s intransigence, expensive and time-consuming delays, and focus on individual liability protections are standing in the way of a transaction that will benefit the Company and its stockholders. In addition, during this period of delay, the Company has been effectively shut out of the market, which we worry impairs SWK’s reputation and its ability to retain management, which ultimately hurts the future value of the Company for all stockholders.

    Accordingly, funds under our control have nominated two persons to serve as directors of the Company (the “Nominees”). Although the Nominees are not affiliated with Carlson Capital, L.P. and are disinterested with respect to the Proposed Transaction, we have discussed the terms of the Proposed Transaction with the Nominees and they have reviewed materials relevant to the Proposed Transaction. We believe that any independent and disinterested directors would find the Proposed Transaction to be in the best interests of the Company’s stockholders, and we see no reason why the Nominees, if they are elected and subject to the exercise of their fiduciary duties as directors and the facts and circumstances existing at the time of any determination, would determine otherwise. We expect to send a definitive proxy statement to the Company’s stockholders, urging that stockholders who support the Proposed Transaction vote for the Nominees at the Company’s 2014 annual meeting of stockholders.

    SWK needs a transformative transaction to capitalize on the successful platform its management team has built. Among potential proposals, only Carlson’s offer brings the scale necessary for this business to succeed and capture the benefit of its NOLs. We are proposing changes to the Board to finally resolve the roadblocks to a deal that maximizes value for all stockholders.
    Appendix B contains our notice of director nominations (including the consent of each Nominee to serve as a director).

    Very truly yours,
    Carlson Capital, L.P."
    Jul 17 12:49 PM | Likes Like |Link to Comment
  • Yahoo!'s (YHOO) CEO Marissa Mayer on Q2 2014 Results - Earnings Call Transcript [View article]
    I hope she has thanked Jerry Yang for making the Alibaba investment. I would love to know how much that decision of his contributed to her vastly inflated option compensation package.
    Jul 16 12:10 PM | 1 Like Like |Link to Comment
  • SWK Holdings: A Micro Cap With A Solid Plan To Compound Shareholder Equity [View article]
    They didn't pay $706,000 in taxes. That was a non-cash charge against their deferred tax asset. If you check the statement of cash flows you will find that this amount is added back in, ie it is a non-cash charge. You will also find it on page 22 under note 8 as the net difference between deferred tax assets (Net and Gross) at year end 13 vs Q1.
    Jul 14 12:33 PM | Likes Like |Link to Comment
  • SWK Holdings: A Micro Cap With A Solid Plan To Compound Shareholder Equity [View article]
    It looks as if I might have made an error in not noting this text from the special committee evaluation of Carlson Capital's 96M capital raise:

    "he Special Committee is disappointed in Carlson's attempt to thwart the process by which the Special Committee has been evaluating financing alternatives, including the proposal by Carlson Capital. Carlson Capital's June 20th letter is nothing more than a tactic aimed at pressuring the Special Committee to accept its proposal without ensuring that the stockholders of the Company that are not affiliated with Carlson Capital have the opportunity to make an informed decision as to whether the Company should engage in a transaction that on its face would be highly dilutive to them"

    I am disappointed that I had not noticed this before finishing the article, and might see If I can add an updated viewpoint. Obviously I want the terms to be fair to all shareholders (myself included), I am impressed with the special committee's commitment to this principle.
    Jul 12 03:37 PM | 1 Like Like |Link to Comment
  • SWK Holdings: A Micro Cap With A Solid Plan To Compound Shareholder Equity [View article]
    It has not been finalized and a date has not been set. If you read the link I provided, it appears that Management wants to go through with it, and the majority shareholder has agreed to conduct it in conjunction with their larger investment at $1.20. So it looks like it is in the process of being negotiated.
    Jul 11 10:20 AM | 1 Like Like |Link to Comment
  • Are Storm Clouds Gathering For These 5 High-Yielding Securities? [View article]
    I is similar to a stock split because it is a 21:20 stock split, rather than the more common 2:1 split, or Apple's recent 7:1 Spit. If they split 21:20 but keep the dividend the same per share, your actual div. payout goes up 5%, which is the real economic impact to the shareholder. Last year they increased the div by 5% but then with the stock split the effective div payout went up 10%. I'm not judging if this action is good or bad, just describing what is occurring. I am mystified as to why the company does this vs. just increasing the div by the full 10%. The only impact i see is that it is a less obvious way to increase the total div payout.
    Jul 9 12:02 AM | 1 Like Like |Link to Comment
  • Are Storm Clouds Gathering For These 5 High-Yielding Securities? [View article]
    The stock dividend does not count towards the dividend for the same reason a stock split does not. It is more similar to a stealth dividend increase, as u get the same div. per share but on more shares.
    Jul 8 06:27 PM | Likes Like |Link to Comment
  • Winmark Corp: Win Is A Common Theme For John Morgan [View article]
    Good article! The company definitely deserves the publicity, though I was enjoying the opportunity to buy under 70 and was hoping for a dip to the low 60's. I did add to my holdings in the 66-67 area. I spoke with the company recently and was very impressed with what they had to say on capital allocation as well as well as the philosophy of the franchise business.

    For those who follow the company, I am working on a brief update of the WINA article I did last summer:
    Jun 27 08:57 PM | Likes Like |Link to Comment
  • Why Altria Is Our Favorite Dividend Growth Idea In Tobacco [View article]
    If u count all the spinoffs and dividends over it's history, i doubt any stock has done more for investors, period.
    Jun 11 09:44 PM | 2 Likes Like |Link to Comment
  • Balchem: Boring But Beautiful [View article]

    I was curious what your opinion was of the recent big acquisition. I saw the activity on last quarters conference call - have you been able to form a solid opinion on this yet, or is it too early?
    Jun 7 10:25 PM | Likes Like |Link to Comment
  • A 'Special Situation' Opportunity At National Beverage Equals Low Risk With High Reward [View article]
    For those who don't know (I don't write about it here) my primary business is short term futures trading. Most investors don't understand that short term moves are not logical, they are just driven by money flows. The stop run dynamic is perhaps the most important to understand - If you understand it it is very high percentage fade, though nothing works every time - it is a percentage play.

    Allot of the small caps I like are behaving poorly lately - I think it is a symptom of changing risk dynamics in the market, people are getting antsy - particularly for speculative holdings it is a time for caution, as I said a few weeks ago in some other comment (I think) in this thread.
    May 15 10:04 AM | Likes Like |Link to Comment