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Nat Stewart

 
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  • Mesa Laboratories: A Highly Overvalued Levered Rollup With Low Single-Digit Organic Growth And Aggressive Insider Selling [View article]
    They have made some sharp moves lately on the acquisition front, they now need to prove that the activity was intelligent from a ROIC perspective. We need evidence they are creating value per share, not just adding margin and growth at what appears to be a high cost.
    Apr 23 08:18 PM | Likes Like |Link to Comment
  • FTD Companies - A Free Cash Flow Monster With 50% Upside [View article]
    Are you referring to the management forecasts that were released on march 5 with the earnings release?

    My article was published one month prior to that, on February 5th. If there was a management forecast prior to the publication of this article, I was not aware of it, otherwise I would have used it.

    To see why my numbers were high i would need to know what managements assumptions were vs. mine. For example, i might have underestimated some things (perhaps stand-alone company costs) and over-estimated other things (perhaps growth or gross margin%).

    I believe the 10% pre-tax yield is high IF one believes the company's competitive position is solid and will hold up for a reasonable length of time. This is what i tried to convey in the third and fourth from the last paragraphs.

    To understand the basis for my comment about the pre-tax yield, you need to look at the context I framed it in, which was the company's cost of debt financing.

    This company has been highly levered by two private equity firms in the past. It could at some point do a significant dividend recap, continue with massive buybacks, or be taken private. Pre-tax is relevant because (as you know) debt is a pre-tax expense, so it tells us something about how much debt the company could potentially support if things moved in that direction.

    The real heart of the issue, though, is if the businesses competitive position will be stable for a reasonable length of time (at the minimum). I didn't make that the focus of my article, and indeed I am actually less sure about it now vs. when I wrote the article.

    As It is i would not be surprised (this is just my speculation) to see some type of corporate event occur before the amortization expense completely rolls off. The tax shield is too valuable for someone to not attempt take advantage of it, and it is something that the public markets don't seem to understand very well.
    Apr 21 08:54 PM | Likes Like |Link to Comment
  • Is Tesla's Gigafactory Becoming A Gigafarce? [View article]
    "When the automobile changed from a horse and buggy, wonder if people thought this would work."

    Almost no one. Investors in particular thought it was a niche product with limited utility. Henry Ford CREATED the mass market when he drove costs down and productivity up beyond what was thought even remotely possible.

    The greats always go for what is beyond though possible. And, win or lose, they create a legacy beyond mere financial returns.
    Apr 8 02:38 PM | 13 Likes Like |Link to Comment
  • A 'Special Situation' Opportunity At National Beverage Equals Low Risk With High Reward [View article]
    Batman, buy 100 cases and hire a few good looking women in yoga pants to help u pass them out. Who said investors need to stay on the sidelines ; )

    I would not mind seeing a variants of the natural products contain a caffeine booster (Natural of course), to more directly compete with diet cola type products or even coffee based beverages. Every time I go by Starbucks it reminds me how important caffeinated beverages are to people, it's no small thing. The next diet coke might not be diet coke.
    Apr 7 04:19 PM | Likes Like |Link to Comment
  • A 'Special Situation' Opportunity At National Beverage Equals Low Risk With High Reward [View article]
    Oh, it was you stepping in front of my orders : P
    Apr 4 01:20 PM | Likes Like |Link to Comment
  • A 'Special Situation' Opportunity At National Beverage Equals Low Risk With High Reward [View article]
    Do you have an opinion on what USLM should be doing with the cash that builds up? Their capital structure seems super conservative relative to their cash flow. I think the independents realize they own great assets so new acquisitions are difficult to find.
    Apr 4 12:30 PM | Likes Like |Link to Comment
  • A 'Special Situation' Opportunity At National Beverage Equals Low Risk With High Reward [View article]
    USLM has been a real sleeper that I have owned for years. You need patience to own some of these companies!
    Apr 4 12:21 PM | Likes Like |Link to Comment
  • A 'Special Situation' Opportunity At National Beverage Equals Low Risk With High Reward [View article]
    I general I agree. However, the practical side of Macro is not what it appears to be. It is not about making accurate calls so much as making big money when you are correct and cutting losses.

    You can see this in George Soros's first book, particularly the "real time experiment" chapters. In a time period where most all of his macro calls were off significantly, he made something like a 100% return.
    Apr 4 12:20 PM | Likes Like |Link to Comment
  • A 'Special Situation' Opportunity At National Beverage Equals Low Risk With High Reward [View article]
    The world of marketing is much like the world of current consumer beverage tastes - Rapidly changing and ripe with opportunity.

    I believe that it is time for FIZZ to go all in to seize the moment. It is not about the short term, but building the option value of the brands. I have advocated for this position in my articles, which reflect my best creative thinking on the topic.

    There are tons of potential ways to reach consumers and gain mind-share that are very exiting. Markets are becoming fragmenting as the country fragments we have become a nation of identity groups, yet common themes inspire all. Targeting niche groups is the future. The web stuff, social, partnerships with key consumer influencers, Yoga Studios, health clubs, etc - Reach a key influencer and you influence all their followers. Most people want what they see others, particularly those they aspire to be, wanting (in this case drinking). Target some population dense areas with a saturation campaign aimed at the target markets, the influencers. What percent of the key influencer groups know of the brands, drink the brands, and have tried the new products? I go to a health club in a major City. What % have tried curate?

    Push the brand message out in creative ways, and I think it will resonate. DO something to get on the news. Become the news in a way that resonates, inspires, and creates curiosity. Make people talk, Reward people for telling others, and be the identity that people want to reflect.

    This is what the creative marketing people are doing now. I know FIZZ has some of this stuff going, but it is time to AMP it up and increase the voltage. That is what I would like to see. A distribution deal or whatever else can be a part of this - the further they can push it on their own, the better terms they will get. Basically, I want the company to achieve the potential that I believe exists. As an investor, that is the path that I advocate for.
    Apr 4 12:07 PM | Likes Like |Link to Comment
  • A 'Special Situation' Opportunity At National Beverage Equals Low Risk With High Reward [View article]
    Just a little update on my current thoughts -

    After an extraordinarily tough winter (coldest on record here in Chicago) and tough quarter, it was good to see that the company was still solidly profitable. I chart earnings and 10-k data for 10-15 years on most of the stocks I follow. Aside from familiarizing me with the operations of a business, it gives context that life and business are not linear, and they do not need to be. I am Seeing LaCroix Curate in more stores, and also reading good consumer reaction online.

    What I would most like to see right now as it "warms up" and spring arrives is that the pent up energy of this horrible winter is released with a substantial marketing and branding push for LaCroix and the other key strategic products. I would like to see these brands achieve the full potential that they are capable of, which calls for a gain in consumer mind-share. So, as I continue to analyze the situation, that is what I will be looking for and hoping to see.

    In terms of a sale or distribution deal, Major corporations that this would be with are very large and not known for rapid decision-making. Indeed they are known for a bureaucratic process. The optionality is there - my belief is that as time passes this option value will actually increase, not decrease, making it a good situation.

    A word about my philosophy and approach on a few things (feel free to agree or disagree).
    As I state on my personal web site, I put a great deal of focus on my evaluation of the person behind a company. And, consistently, I try to put the insights I gain from this front and center. That type of analysis is a big part of what makes writing articles interesting to me.

    For example: In My Winmark Article http://bit.ly/1lEQDCD, I made my analysis of John Morgan and his incentives a major focus. In my New England Reality article http://bit.ly/1lEQDCF, I made Harold Brown's 50+ year career in real estate a key part of the narrative. I have done the same thing with National Beverage, and so far it has paid off, specifically with the special dividend, but also with this years proxy statement. Time will tell if the analysis in this article proves to be valid or not. I don't write articles just for the heck of it. I hope to have information or perspective that adds values for readers and investors. If I fail at this, I will stop writing, simple as it is.

    As for market action, I would love to see more selling tomorrow as I have free cash to invest. The only hesitation I have is that I think the overall market or macro is at a risky point until Yellen is tested or "vetted" by the market. Bu that is just my opinion.
    Apr 3 10:20 PM | Likes Like |Link to Comment
  • The Only 20 Companies That Matter [View article]
    Well said and very true.
    Mar 29 07:02 PM | 1 Like Like |Link to Comment
  • Is Phillips 66 Partners Overextended Here? [View article]
    Keep in mind that the high split on the IDRs is just $0.318750 per quarter.
    Mar 25 09:33 PM | Likes Like |Link to Comment
  • Don't Judge Berkshire Hathaway By Its Book Value Cover [View article]
    "On a risk adjusted basis, Warren has destroyed investor value."

    As others have noted, this article is so full of inaccuracies and misconstrued opinions that it is almost not worth responding to.

    However, I will debunk the above statement. BRK.A has the highest sharpe ratio of any stock or mutual fund over the past 30 years. The very highest, not just one of the best. And this is based on stock price returns, not book value. In other words the author makes a declarative statement and is not just "kinda" wrong, but is 100%, dead wrong, as wrong as one could possibly be. And this is very typical of the rest of the article.

    Anyone who wants a real understanding of Buffett's massive risk-adjusted outperformance should read the following academic paper (PDF):

    http://goo.gl/Kv9kKY
    Mar 12 03:31 PM | 6 Likes Like |Link to Comment
  • IBM: An Island Of Value In A Sea Of Overpriced Stocks [View article]
    I notice an interesting train of thought based upon the comments. IBM seems to be a company managed by people who are myopically looking at "EPS Targets" and financial metrics and gimmicks, but without much interest in technology or world class products or services.

    Compare this to a company like Google, which puts technology, brilliant engineers, and great products first, and then makes money because they have redefined marketplaces and met consumer and user needs in a brilliant way.

    If what the critics say about IBM is accurate (and I am not an expert on the company) It could, quite succinctly, be used as a textbook example of what has gone badly wrong with American capitalism. Though calling IBM an "American" company is surely a misnomer at this point.
    Mar 12 12:35 AM | 1 Like Like |Link to Comment
  • Are Pyramid Schemes Inherently Fraudulent? [View article]
    I switched to saying "financial sales" not insurance in my second example for a reason.
    Mar 10 02:38 PM | 2 Likes Like |Link to Comment
COMMENTS STATS
365 Comments
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